SB 121: "An Act establishing the State of Alaska Capital Corporation; authorizing the issuance of bonds by the State of Alaska Capital Corporation to finance capital improvements in the state; and providing for an effective date."
00 SENATE BILL NO. 121 01 "An Act establishing the State of Alaska Capital Corporation; authorizing the issuance 02 of bonds by the State of Alaska Capital Corporation to finance capital improvements in 03 the state; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 37.15 is amended by adding new sections to read: 06 Article 7. State of Alaska Capital Corporation. 07 Sec. 37.15.900. Corporation established. There is established in the 08 Department of Revenue the State of Alaska Capital Corporation. The corporation is a 09 public corporation of the state with a separate and independent legal existence. 10 Sec. 37.15.910. Board of the corporation; staff; meetings. (a) The 11 members of the state bond committee (AS 37.15.110) are the members of the board of 12 directors of the State of Alaska Capital Corporation. 13 (b) The commissioner of revenue shall serve as chair of the board of directors 14 of the corporation. The powers of the corporation are vested in the directors, and three
01 directors of the corporation constitute a quorum. Action may be taken and motions 02 and resolutions adopted by the corporation at a meeting by the affirmative vote of a 03 majority of the directors. The directors of the corporation serve without 04 compensation. The Department of Revenue shall provide the staff of the corporation. 05 (c) The board of directors may meet and transact business by an electronic 06 medium if 07 (1) public notice of the time and locations where the meeting will be 08 held by an electronic medium has been given in the same manner as if the meeting 09 were held in a single location; 10 (2) participants and members of the public in attendance can hear and 11 have the same right to participate in the meeting as if the meeting were conducted in 12 person; and 13 (3) copies of pertinent reference material, statutes, regulations, and 14 audio-visual material are reasonably available to participants and to members of the 15 public. 16 (d) A meeting by an electronic medium as provided by (c) of this section has 17 the same legal effect as a meeting in person. 18 Sec. 37.15.920. Powers of the corporation. (a) To accomplish its corporate 19 purposes, the corporation has the following powers in addition to its other powers: 20 (1) to sue and be sued; 21 (2) to have a seal and alter it at pleasure; 22 (3) to make and alter bylaws for its organization and internal 23 management; 24 (4) to adopt regulations governing the exercise of its corporate powers; 25 (5) to issue bonds to finance or refinance the construction, acquisition, 26 refurbishing, repair, and equipping of state capital improvements, including the 27 establishment or increase of reserves to secure or to pay the bonds or interest on them, 28 and the payment of all other costs or expenses of the corporation incident to and 29 necessary or convenient to carry out its corporate purposes and powers; 30 (6) to acquire property interests by lease or use agreements; 31 (7) to enter into lease or use agreements with the Department of
01 Administration or other departments of the state, political subdivisions of the state, or 02 the federal government, as necessary, in connection with projects financed by bonds of 03 the corporation; 04 (8) to enter into a cooperative purchasing agreement with the state 05 bond committee for the special services that the state bond committee is authorized to 06 obtain under AS 37.15.150, including the appointment of trustees, auditors, or escrow 07 agents to carry out any of the powers granted by AS 37.15.900 - 37.15.985; and 08 (9) to enter into other contracts or other transactions regarding the 09 powers granted by this section, with any person. 10 (b) Lease or use agreements authorized by this section are not lease-purchase 11 agreements within the meaning of AS 36.30.085. 12 Sec. 37.15.930. Bonds of the corporation. (a) The corporation may borrow 13 money, and may issue special limited obligation bonds of the corporation in a total 14 principal sum not to exceed $350,000,000, secured solely by annual appropriations 15 that may be made by law, by the debt service reserve fund, and by other property, 16 property interests, or security provided by the corporation. The bonds shall be issued 17 in an amount sufficient to finance capital improvements authorized by law. The 18 money to pay principal and interest on the bonds is subject to annual appropriation by 19 the legislature and may be the sole consideration for lease or other use agreements for 20 the capital improvements financed through the issuance of the bonds. 21 (b) Bonds shall be authorized by resolution of the corporation, may be issued 22 for funding or refunding purposes, and shall be dated and shall mature as the 23 resolution authorizing their issuance may provide, except that no bond may mature 24 more than 40 years from the date of its issue. Bonds shall bear interest at the fixed or 25 variable rates, be in the denominations, be in the form, either coupon or registered, 26 carry the registration privileges, be executed in the manner, be payable in the medium 27 of payment, at the places, and be subject to the terms of redemption that the resolution, 28 contract, or a subsequent resolution or contract may provide. 29 (c) All bonds, regardless of form or character, shall be negotiable instruments 30 for all the purposes of AS 45.01 - AS 45.08, AS 45.12, AS 45.14, and AS 45.29 31 (Uniform Commercial Code).
01 (d) All bonds may be sold at public or private sale in the manner, for the price 02 or prices, and at the time or times that the corporation determines. 03 (e) The bonds issued by the corporation do not constitute an indebtedness or 04 other liability of the state or of a political subdivision of the state, other than the 05 corporation, but shall be payable solely from the income and receipts or other funds or 06 property of the corporation. The corporation may not pledge the faith or credit of the 07 state or of a political subdivision of the state, other than the corporation, to the 08 payment of a bond and the issuance of a bond by the corporation does not directly or 09 indirectly or contingently obligate the state or a political subdivision of the state to 10 apply money from, or levy or pledge any form of taxation whatever to the payment of 11 the bond. Each bond issued by the corporation shall describe the foregoing limitations 12 plainly on its face. 13 Sec. 37.15.940. Revenue fund established. (a) There is established as a 14 special fund of the corporation the State of Alaska Capital Corporation revenue fund, 15 into which may be paid all amounts appropriated by the legislature. These 16 appropriations represent revenue, fees, charges, and rentals derived by the corporation 17 from lease or use agreements with state agencies for capital projects financed from the 18 proceeds of bonds of the corporation. The money in the revenue fund may be 19 expended for any authorized purpose of the corporation, established by resolution of 20 the corporation, including transfer to the bond redemption fund, the construction fund, 21 or the debt service reserve fund, or to pay the expenses of the corporation. 22 (b) The commissioner of revenue shall, on behalf of the corporation, invest 23 money in the revenue fund under the authority provided in AS 37.10.070, 37.10.071, 24 and 37.10.075. The interest earned on or any profits derived from the sale of this 25 investment shall be deposited in and become a part of the revenue fund. 26 Sec. 37.15.950. Construction fund established. (a) There is established as a 27 capital construction fund of the corporation the State of Alaska Capital Corporation 28 construction fund, into which shall be paid the net proceeds received from the sale of 29 the bonds, less any accrued interest paid on the bonds that was deposited in the bond 30 redemption fund under AS 37.15.970(b) and less any amount deposited in the debt 31 service reserve fund under AS 37.15.960(a); and other money of the corporation
01 authorized for transfer to the construction fund by resolution of the corporation. The 02 money in the construction fund may be used for any purpose for which bonds may be 03 issued, including the payment of issuance and financing costs and arbitrage rebate. 04 The corporation also may transfer money in the construction fund to the debt service 05 reserve fund or the bond redemption fund. 06 (b) The commissioner of revenue shall, on behalf of the corporation, invest 07 money in the construction fund under the authority provided in AS 37.10.070, 08 37.10.071, and 37.10.075. The interest earned on or any profits derived from the sale 09 of this investment shall be deposited in and become a part of the construction fund. 10 Sec. 37.15.960. Debt service reserve fund established. (a) For the purpose 11 of securing bonds, there is established as a special fund of the corporation, the State of 12 Alaska Capital Corporation debt service reserve fund. The corporation shall deposit 13 bond proceeds or other money received by the corporation, or surety instruments, into 14 the debt service reserve fund equal to the debt service reserve fund requirement set by 15 (c) of this section. 16 (b) Except as provided in this subsection, money in the debt service reserve 17 fund may not be withdrawn from it at any time in an amount that would reduce the 18 balance of that fund to less than the debt service reserve fund requirement set by (c) of 19 this section. Notwithstanding the debt service reserve fund requirement set by (c) of 20 this section, money may be withdrawn from the debt service reserve fund for the 21 purpose of paying, if necessary, the following: 22 (1) arbitrage rebate on earnings of the fund; 23 (2) debt service on bonds. 24 (c) Bonds secured by the debt service reserve fund may not be issued unless 25 the debt service reserve fund has a balance equal to the least of 26 (1) the maximum annual debt service on outstanding bonds issued by 27 the corporation; 28 (2) 125 percent of the average annual debt service on all outstanding 29 bonds of the corporation; or 30 (3) 10 percent of the proceeds of outstanding bonds. 31 (d) In computing the amount of the debt service reserve fund requirement for
01 the purpose of (c) of this section, securities in which all or a portion of the money in 02 the debt service reserve fund is invested shall be valued by some reasonable method 03 established by the Department of Revenue. Valuation on a particular date shall 04 include the amount of any interest earned or accrued to that date. 05 (e) The commissioner of revenue shall annually, no later than January 30, 06 make and deliver to the governor and the legislature a certificate stating the sum, if 07 any, required to restore the debt service reserve fund to the debt service reserve fund 08 requirement set by (c) of this section. The legislature may appropriate the amount 09 requested, which shall be deposited by the corporation in the debt service reserve fund. 10 Nothing in this section creates a debt or liability of the state. 11 (f) The Department of Revenue shall, on behalf of the corporation, invest the 12 money in the debt service reserve fund in accordance with AS 37.10.070, 37.10.071, 13 and 37.10.075. Money in the debt service reserve fund shall be transferred to the bond 14 redemption fund at any time if necessary to pay principal of and interest and 15 redemption premium, if any, on the bonds. 16 Sec. 37.15.970. Bond redemption fund established. (a) There is established 17 as a special fund of the corporation the State of Alaska Capital Corporation bond 18 redemption fund, for paying and securing the payment of the principal of and interest 19 and redemption premium, if any, on the bonds and which shall be at all times 20 completely segregated and set apart from all other funds of the corporation. 21 (b) Accrued interest paid on the bonds shall be deposited in the bond 22 redemption fund. As provided by resolution of the corporation, amounts also may be 23 transferred from the revenue fund to the bond redemption fund and expended to pay 24 debt service, or reduce the outstanding principal of the bonds. Payment for these 25 purposes may be according to the order of priority established by resolution of the 26 corporation. 27 Sec. 37.15.980. Refunding bonds. (a) The bonds or any part of them may be 28 refunded at or before their maturity by the issuance of refunding bonds of the 29 corporation if, in the opinion of the board of directors of the corporation, refunding is 30 advantageous to and in the best interests of the corporation. 31 (b) The issuance of refunding bonds need not be authorized by an act of the
01 legislature, and the board of directors of the corporation shall adopt the resolution or 02 resolutions and prepare all other documents and proceedings necessary for the 03 issuance, exchange or sale, and delivery of the refunding bonds. All provisions of 04 AS 37.15.910 - 37.15.985 applicable to bonds are applicable to the refunding bonds 05 and to the issuance, sale, or exchange of them, except as otherwise provided in this 06 section. 07 (c) Refunding bonds may be issued in a principal amount sufficient to provide 08 money for the payment of all bonds to be refunded by them and, in addition, for the 09 payment of all expenses incident to the calling, retiring, or paying of the outstanding 10 bonds and the issuance of the refunding bonds. These expenses include the difference 11 in amount between the par value of the refunding bonds and any amount less than par 12 for which the refunding bonds are sold, any amount necessary to be made available for 13 the payment of interest upon the refunding bonds from the date of sale of them to the 14 date of payment of the bonds to be refunded or to the date upon which the bonds to be 15 refunded will be paid pursuant to the call of them or agreement with the holders of 16 them, and the premium, if any, necessary to be paid in order to call or retire the 17 outstanding bonds and the interest accruing on them to the date of the call or 18 retirement. 19 Sec. 37.15.985. Annual audit of corporation. The corporation shall have its 20 financial records audited annually by a certified public accountant. The legislative 21 auditor may prescribe the form and content of the financial records of the corporation 22 and shall have access to these records at any time. 23 Sec. 37.15.990. Definitions. In AS 37.15.900 - 37.15.990, 24 (1) "bond redemption fund" means the State of Alaska Capital 25 Corporation bond redemption fund established in AS 37.15.970; 26 (2) "bonds" means the special limited obligation bonds, notes, or other 27 evidences of indebtedness authorized in AS 37.15.930; 28 (3) "construction fund" means the State of Alaska Capital Corporation 29 construction fund established in AS 37.15.950; 30 (4) "corporation" means the State of Alaska Capital Corporation 31 established in AS 37.15.900;
01 (5) "debt service reserve fund" means the State of Alaska Capital 02 Corporation debt service reserve fund established in AS 37.15.960; 03 (6) "lease or use agreement" is an agreement that secures or is related 04 to bonds of the corporation and is not a lease-purchase agreement for purposes of 05 AS 36.30.085; 06 (7) "revenue fund" means the State of Alaska Capital Corporation 07 revenue fund established in AS 37.15.940. 08 * Sec. 2. This Act takes effect June 30, 2005.