SB 46: "An Act relating to the Alaska Municipal Bond Bank Authority; authorizing the Alaska Municipal Bond Bank Authority to issue bonds or notes for a regional health organization; and providing for an effective date."
00 SENATE BILL NO. 46 01 "An Act relating to the Alaska Municipal Bond Bank Authority; authorizing the Alaska 02 Municipal Bond Bank Authority to issue bonds or notes for a regional health 03 organization; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 44.85.005 is amended to read: 06 Sec. 44.85.005. Legislative findings. The legislature finds that 07 (1) the rapid growth of municipalities in the state and the incorporation 08 of new municipalities has created a demand for capital improvements that can only be 09 met by these municipalities borrowing money through the issuance of bonds or notes; 10 (2) many of these municipalities, although creditworthy, either have 11 not issued bonds or notes or have little outstanding debt; 12 (3) the cost of borrowed money to these municipalities is or may be 13 unnecessarily high due to lack of investor familiarity with the municipalities; 14 (4) other municipalities in the state pay unnecessarily high borrowing
01 costs because of the distance of the state from capital markets or may find borrowing 02 difficult or impossible because of temporary economic dislocation due to loss of 03 employment or prospective loss of employment; 04 (5) the University of Alaska has limited debt capacity and may pay 05 higher interest rates because of lower credit ratings; 06 (6) many municipalities provide for or partner with nonprofit 07 organizations to provide for delivery of health care; 08 (7) nonprofit regional health organizations deliver services in 09 many locations where municipal partners are unavailable. 10 * Sec. 2. AS 44.85.010(a) is amended to read: 11 (a) It is the policy of the state to 12 (1) foster and promote by all reasonable means the provision of 13 adequate capital markets and facilities for borrowing money by municipalities in the 14 state to finance capital improvements or for other authorized purposes, to assist these 15 municipalities in fulfilling their capital needs and requirements by use of borrowed 16 money within statutory interest rate or cost of borrowing limitations, to the greatest 17 extent possible to reduce costs of borrowed money to taxpayers and residents of the 18 state, and equally to encourage continued investor interest in the purchase of bonds or 19 notes of municipalities as sound and preferred securities for investment; 20 (2) encourage municipalities to continue their independent 21 undertakings and financing of capital improvements and other authorized purposes 22 and to assist them by making capital funds available at reduced interest costs for 23 orderly financing of capital improvements and other purposes especially during 24 periods of restricted credit or money supply, particularly for those municipalities not 25 otherwise able to borrow for capital needs; 26 (3) assist municipalities to provide for adequate insurance coverage by 27 authorizing the Alaska Municipal Bond Bank Authority to issue negotiable or 28 nonnegotiable revenue bonds, notes, or certificates of participation either directly or 29 through an entity it may create for the purpose of providing a self-insurance program 30 for municipalities or municipal joint insurance arrangements organized under 31 AS 21.76;
01 (4) assist governmental employers to prepay all or a portion of their 02 share of unfunded accrued actuarial liabilities of retirement systems in an effort to 03 reduce their costs of satisfying their contractual obligations to provide retirement and 04 other benefits to public employees through the issuance of bonds, notes, commercial 05 paper, or other obligations by the bond bank authority or by a subsidiary corporation 06 created by the bond bank authority under AS 44.85.085, but only if the state bond 07 rating is the equivalent of AA- or better; this assistance is limited as provided in 08 AS 37.15.903; 09 (5) assist the University of Alaska to provide heating or energy 10 projects by providing capital funds through loans that minimize costs and the effects 11 on the debt capacity of the University of Alaska; 12 (6) assist regional health organizations to provide health care 13 facilities by providing capital funds through loans that minimize costs and the 14 effects on the debt capacity of regional health organizations when the 15 commissioner of health and social services anticipates a state financial benefit 16 and an increase in regional quality of care. 17 * Sec. 3. AS 44.85.090 is amended to read: 18 Sec. 44.85.090. Limitations. Under this chapter, the bond bank authority may 19 not 20 (1) make loans of money to a person, firm, or corporation other than a 21 municipality, [OR] the University of Alaska, or a regional health organization or 22 purchase securities issued by a person, other than a municipality, except for 23 investment as provided in this chapter; 24 (2) emit bills of credit, accept deposits of money for time or demand 25 deposit, administer trusts, or engage in any form or manner in, or in the conduct of, a 26 private or commercial banking business, or act as a savings bank or savings and loan 27 association; 28 (3) be or constitute a bank or trust company within the jurisdiction or 29 under the control of a regulatory or supervisory board or department of the state, or the 30 Comptroller of the Currency of the United States, or the Department of the Treasury, 31 or Federal Reserve Board of the United States; or
01 (4) be or constitute a bank, banker, or dealer in securities within the 02 meaning of or subject to the provisions of securities, securities exchange, or securities 03 dealers law, of the United States or of this state or of another state. 04 * Sec. 4. AS 44.85.180(e) is amended to read: 05 (e) Notwithstanding (a), (b), and (c) of this section, the bond bank authority 06 may issue its bonds or notes 07 (1) in principal amounts not to exceed $87,500,000 for the purpose of 08 making loans to the University of Alaska; and 09 (2) in principal amounts not to exceed $250,000,000 for the 10 purpose of making loans to a regional health organization. 11 * Sec. 5. AS 44.85.410(4) is amended to read: 12 (4) "municipal bond" means a bond or note or evidence of debt that 13 constitutes 14 (A) a general obligation bond that is a direct and general 15 obligation of a political subdivision of the state, all the taxable property within 16 which is subject to taxation to pay the bond, note, or evidence of debt, and the 17 interest without limitation, as to rate or amount generally to the extent 18 permitted by law or to avoid a default as provided for second class cities under 19 AS 29.45.590; 20 (B) a revenue bond issued by a municipality, the University of 21 Alaska, a solid waste management authority, or a port authority that pledges 22 the revenue of a revenue-producing capital improvement and that is payable 23 solely from the revenue of the revenue-producing capital improvement; 24 (C) a general obligation bond or revenue bond combined or 25 additionally secured; 26 (D) a bond of a borough issued as a general obligation of a 27 service area under AS 29.47.440 or former AS 29.58.340; [OR] 28 (E) an obligation of a municipality secured only by 29 (i) special assessments on benefited property; 30 (ii) tax increments and a letter of credit or equal 31 security; or
01 (iii) a lease; or 02 (F) a bond, note, or other obligation of a regional health 03 organization that is a general obligation of the regional health 04 organization, that is secured by a pledge of a special fund of the regional 05 health organization, or that is a combination of them or additionally 06 secured; 07 * Sec. 6. AS 44.85.410 is amended by adding a new paragraph to read: 08 (9) "regional health organization" has the meaning given in 09 AS 18.28.100. 10 * Sec. 7. This Act takes effect immediately under AS 01.10.070(c).