2016 -- S 2007 SUBSTITUTE B

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LC003777/SUB B

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- PUBLIC FINANCE

MANAGEMENT BOARD

     Introduced By: Senators DaPonte, Pearson, DiPalma, Lombardi, and Walaska

     Date Introduced: January 12, 2016

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 42-10.1-2 and 42-10.1-4 of the General Laws in Chapter 42-10.1

entitled “Public Finance Management Board” are hereby amended to read as follows:

     42-10.1-2. Purpose. -- It shall be the purpose and responsibility of the board:

     (1) To advise and assist all state departments, municipal and regional authorities,

agencies, boards, commissions, and public and quasi-public corporations, and fire districts and

other special districts having authority to issue revenue or general obligation bonds or GARVEE

bonds or notes or other various types of conduit debt or enter into financing leases with respect to

issuance of and financial planning related to all those bonds, leases, and notes;

     (2) Upon request, tTo advise and/or assist any city or town and any municipal or regional

agency, authority, board, commission, or public or quasi-public corporations, or fire districts or

other special districts having authority to issue revenue or general obligation bonds or GARVEE

bonds or notes or other various types of conduit debt or enter into financing leases with respect to

the issuance and financial planning related to those bonds, leases, and notes;

     (3) To collect, maintain, and provide information on all state, municipal and regional

authority, agency, board, commission, public or quasi-public corporation, and fire district and

other special district debt authorization, sold and outstanding, and serve as a statistical center for

all state and municipal debt issues;

     (4) To maintain contact with state, municipal and regional authority, agency, board,

commission, public or quasi-public corporation, fire district and other special district bond

issuers, underwriters, credit rating agencies, investors, and others to improve the market for state

and local government debt issues;

     (5) To undertake or commission studies on methods to reduce the costs and improve

credit ratings of state and local debt issues;

     (6) To recommend changes in state laws and local practices to improve the sale and

servicing of state and local debts. 

     (7) To annually ascertain the total amount of state, regional, municipal, and public and

quasi-public corporation debt authorized, sold and unsold.

     (8) To oversee the undertaking of a debt affordability study no less frequently than every

two (2) years, which shall include recommended limits for the debt capacity of each state,

municipal and regional authority, agency, board, commission, public and quasi-public corporation

and fire district and other special district having authority to issue revenue or general obligation

bonds or GARVEE bonds or notes or other types of conduit debt or enter into financing leases.

     42-10.1-4. Notice of debt issue to board. -- (a) Each state, municipal and regional

department, authority, agency, board, commission, and public and quasi-public corporation, and

fire district and other special district having authority to issue revenue or general obligation bonds

or GARVEE bonds or notes or other various types of conduit debt shall, no later than thirty (30)

days prior to the sale of any such debt issue at public or private sale, give written notice of the

proposed sale to the board; and each such issuer shall, within thirty (30) days after closing, submit

to the board a report of final sale.

     (b) The notice of proposed debt shall include one proposed sale date, the name of the

issuer, the nature of the debt issue, and the estimated principal amount thereof, and such further

information as may be required by rule of the board and shall be delivered in accordance with

procedures to be established by rule of the board; and the notice of final sale shall be made on a

form approved by the board and contain all of the information requested on said form. Any issuer

which fails to submit the report of proposed debt or report of final sale by the appropriate

deadline may be subject to a per diem fine of two hundred fifty dollars ($250), which shall be

collected and enforced by the Office of the General Treasurer.

     (c) Each state, municipal and regional authority, agency, board, commission, public and

quasi-public corporation, and fire district and other special district having authority to issue

revenue or general obligation bonds or GARVEE bonds or notes or various types of conduit debt

or enter into financing leases shall provide annually, within ninety (90) days after the end of each

fiscal year, the following information for each outstanding debt incurred as of the end of such

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year:

     (1) the principal amount of the issue outstanding;

     (2) the amount of proceeds of the issue that remains unspent;

     (3) the amount of debt authorized by the bond act or other appropriate authorization

relevant to the issue that remains authorized but unissued; and

     (4) a list of the purposes for which the debt has been issued and the amounts expended

for each purpose in the prior fiscal year from the proceeds of the issue.

     (c)(d) Failure of delivery of the above notice or of the time or efficiency thereof shall not

affect the validity of the issuance of any debt, bond or note bonds, notes or leases.

     (d)(e) The board shall submit a report annually on or before September 30th of each year

to the director of administration, the speaker of the house, the chairman of the house finance

committee, the president of the senate, the chairman of the senate finance committee, and the

auditor general on debt issues by cities and towns and other authorities, agencies, boards,

commissions, public and quasi-public corporations, fire districts, and other special districts

subject to the provision of chapter 45-12, which report shall include the information set forth in

division (b) of this section and shall be for the notices of debt issues received during the state's

fiscal year next preceding. An electronic transmission of the report shall be considered an

acceptable submission.

     SECTION 2. Chapter 42-10.1 of the General Laws entitled "Public Finance Management

Board" is hereby amended by adding thereto the following sections:

     42-10.1-9. Report of debt affordability and targets. -- (a) The board shall compile and

publish annually the total amount of public state, regional, municipal, and public and quasi-public

corporation debt authorized, sold and unsold.

     (b) No less frequently than every two (2) years, the board shall oversee the undertaking of

a debt affordability study, which shall include recommended limits for the debt capacity of each

state, municipal and regional authority, agency, board, commission, public and quasi-public

corporation and fire district and other special district having authority to issue revenue or general

obligation bonds or GARVEE bonds or notes or other various types of conduit debt or enter into

financing leases.

     42-10.1-10. Public finance management board advisory opinions. -- The board shall

have the authority to offer non-binding, advisory opinions on all aspects of debt management

practices of state, municipal, and public and quasi-public corporations.

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     SECTION 3. This act shall take effect January 1, 2017.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- PUBLIC FINANCE

MANAGEMENT BOARD

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     This act would amend the statutes relating to the public finance management board to

give them authority over all public debt, including municipalities and fire districts and requires

them to issue periodic reports regarding same.

     This act would take effect January 1, 2017.

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