Chapter 329
H.P. 597 - L.D. 781
PART P
Sec. P-1. 23 MRSA c. 19, sub-c. 3-A is enacted to read:
SUBCHAPTER 3-A
Garvee bonding
As used in this subchapter, unless the context otherwise indicates, the following terms have the following meanings.
1. Bank.
"Bank" means the Maine Municipal Bond Bank, established under Title 30-A, chapter 225.
2. GARVEE bond.
"GARVEE bond" means a grant anticipation revenue vehicle debt financing instrument repaid with federal highway funds as authorized by 23 United States Code, Section 122.
3. Qualified transportation project.
"Qualified transportation project" means a project to reconstruct, rehabilitate or replace existing bridges and existing arterial highways that: A. Will forward applicable transportation capital improvement planning and delivery goals established by the Legislature for the Department of Transportation;
B. Has a useful life of 20 years or more; and
C. Meets eligibility requirements of the United States Department of Transportation, Federal Highway Administration.
"Qualified transportation project" does not include a project that predominantly consists of a new highway on a new location or a new bridge on a new location, other than a replacement bridge located in close proximity to the bridge it is replacing, unless specifically approved by the Legislature.
4. Qualified transportation project costs.
"Qualified transportation project costs" includes, without limitation: A. The purchase price or acquisition of any properties or interest in those properties or other rights necessary or convenient for the project;
B. The costs of the study, permitting and engineering of the project, including the preparation of plans and specifications, surveys and estimates of cost;
C. The costs of construction, reconstruction, paving, repaving, building, alteration, repair, restoration, environmental review or remediation, enlargement or other improvement, including all labor, materials, machinery, fixtures and equipment, including rolling stock or vehicles;
D. The costs of engineering, architectural, legal and other professional services;
E. The costs of reserves, insurance, letters of credit or other financial guarantees for payment of future debt service on bonds or notes; and
F. All other costs or expenses necessary or convenient to the project, including financing or refinancing costs.
5. Revenue.
"Revenue" means, in the case of bonds or notes issued by the bank to finance the qualified transportation projects, payment of funds derived from the United States Department of Transportation, Federal Highway Administration and any other investment, gift, grant, contribution, appropriation and income and any other amount pledged to secure payment of such bonds or notes.
Notwithstanding any other provision of law, upon certification, the bank may issue from time to time GARVEE bonds for qualified transportation projects and qualified transportation project costs in such amounts as are authorized by the Legislature, as long as the rolling, 3-year average ratio of GARVEE bond debt service payments to federal funds received from the United States Department of Transportation, Federal Highway Administration does not exceed 15%, less the amount of capacity necessary to issue a $25,000,000 GARVEE bond for extraordinary, unprogrammed needs.
Beginning with the budget presented for the fiscal year beginning July 1, 2009, the Department of Transportation shall present for review and approval by the Legislature as part of the Highway Fund budget the level of programmed biennial GARVEE bond financing.
1. Issuance.
The bank shall issue GARVEE bonds from time to time pursuant to a resolution adopted by the bank. The GARVEE bonds issued must be secured pursuant to a pledge and certificate issued by the Department of Transportation and approved by the State Budget Officer. The pledge and certificate must contain provisions that dedicate and pledge receipt of future federal transportation funds to secure the payment of the GARVEE bonds, including principal, interest and issuance costs. The terms of the GARVEE bonds, their repayment schedule and other provisions to facilitate their creditworthiness are determined by the bank in consultation with the Department of Transportation and the State Budget Officer. The pledge and certificate are a part of the contract with the holders of the GARVEE bonds to be authorized.
2. Form and term.
The GARVEE bonds must be in the form, bear the date or dates, mature at the time or times and have such other terms as determined by the bank and approved by the Department of Transportation and the State Budget Officer, except that a GARVEE bond may not mature more than 15 years from the date of its issue.
3. Not a state liability.
GARVEE bonds issued under this section do not constitute a debt or liability of the State or of any political subdivision of the State, or a pledge of the full faith and credit of the State or of any political subdivision of the State, but are payable solely from the funds and revenues pledged for that purpose.
4. Proceeds.
The proceeds from the sale of the GARVEE bonds must be deposited into the appropriate highway fund capital account or other appropriate dedicated revenue account.
The powers and duties of the bank provided under Title 30-A, chapter 225 are modified and supplemented as set out in this section.
1. Qualified transportation projects.
The bank may assist the State by borrowing money to finance or refinance from time to time all or a portion of the costs of qualified transportation projects and make the proceeds of such borrowing available to the Department of Transportation at terms agreed upon by the bank, the State Budget Officer and the Department of Transportation. The principal of and interest on any bonds or notes issued by the bank to finance or refinance the qualified transportation projects must be secured by a pledge of funds paid by the United States Department of Transportation, Federal Highway Administration and may further be secured by a pledge of any rights, grants, reserves, contracts, agreements or other revenues or property as may be determined by resolution of the bank. Bonds, notes, leases, agreements or other forms of debt or liability entered into or issued by the bank under this section are not in any way a debt or liability of the State and do not constitute a loan of the credit of the State or create any debt or liability on behalf of the State or constitute a pledge of the faith and credit of the State. Each bond, note, lease, agreement or other evidence of debt or liability entered into by the bank must contain a statement to the effect that the bank is obligated to pay the principal, interest, redemption premium, if any, and other amounts payable solely from the sources pledged for that purpose by the bank and that neither the faith and credit nor the taxing power of the State is pledged to the payment of the principal, interest, premium, charge, fee or other amount on the bond, note, lease, agreement or other form of indebtedness.
2. Additional powers.
In addition to all other powers elsewhere granted to the bank, the bank may, with respect to qualified transportation projects: A. Acquire title to or an interest in the qualified transportation projects;
B. Make, enter into and enforce contracts and all other instruments, including any amendments or modifications to the extent permitted under its contract with holders of its bonds or notes, with the State, the United States Department of Transportation, Federal Highway Administration or any other legal entity in furtherance of the purposes of this section;
C. Invest any funds or money of the bank not then required for funding costs of the qualified transportation projects in the same manner as permitted for the investment of funds belonging to the State or held by the Treasurer of State, except as otherwise permitted or provided by this section;
D. Fix and prescribe any form of application or procedure to be required of the State or of any agency or department of the State with respect to the qualified transportation projects and fix the terms and conditions of the qualified transportation projects and enter into agreements with the State or any agency or department of the State in connection with the qualified transportation projects; and
E. Lease the qualified transportation projects to the State or any agency or department of the State to further the purposes of this section, as long as the obligation of the State or of any such agency or department to make any rental or other payments is considered executory only to the extent of funds paid by the United States Department of Transportation.
The Department of Transportation may transfer, assign or pledge any or all of the funds paid to it, directly or indirectly, by the United States Department of Transportation, Federal Highway Administration with respect to the qualified transportation projects. Any such pledge does not constitute a debt or liability on behalf of, a loan of the credit of or a pledge of the faith and credit of the State or of any political subdivision of the State. A decision by the Department of Transportation not to allocate such federal transportation funds for the payment of such bonds or notes or related costs and expenses may not be construed to constitute an action impairing any contract entered into by the bank under this section.
Every contract relating to the issuance of bonds or notes to finance all or a part of the costs of qualified transportation projects must provide that all financial obligations of the State or of any agency or department of the State in regard to the portion of the principal of and interest on the bonds or notes and the related costs and expenses that may be paid from federal transportation funds pursuant to federal law and any agreement between the United States Department of Transportation, Federal Highway Administration or any agency of the Federal Highway Administration and the Department of Transportation that is or will be the initial recipient of such federal transportation funds are subject to continuing federal appropriations of federal transportation funds at a level equal to or greater than the amount needed to pay the federal share of principal, interest and costs and expenses on any such bonds or notes.
1. Transportation projects.
The Department of Transportation, and all other agencies or departments of the State working in conjunction with the Department of Transportation, for the purpose of aiding and cooperating in the financing, construction, operation or maintenance of qualified transportation projects, may: A. Sell, lease, loan, donate, grant, convey, pledge, assign or otherwise transfer to the bank any real or personal property or interests in any real or personal property; and
B. Enter into agreements, including loan and pledge agreements, with any person for the joint financing, construction, operation or maintenance of the qualified transportation projects and agree to make payments, without limitation as to amount except as set forth in the agreements, from revenues received in one or more fiscal years by the Department of Transportation or with any person to defray the costs of the financing, construction, operation or maintenance of the qualified transportation projects.
2. Federal transportation funds.
To assist in the financing, construction, operation or maintenance of the qualified transportation project, a state agency or department may by contract or pledge assign or otherwise transfer to the Department of Transportation or otherwise or directed by the bank all or a portion of federal transportation funds paid to the state agency or department or the revenues from any other legally available source.
Notwithstanding Title 30-A, section 5958, the bank may make loans to the State or any agency or department of the State in connection with the financing of qualified transportation projects. Notwithstanding Title 30-A, section 6003, the bank may issue its bonds from time to time in any principal amounts that it considers necessary to provide funds for any of the purposes authorized by this section, including the financing or refinancing of all or a portion of the costs of qualified transportation projects. Notwithstanding Title 30-A, section 6019, the bank may enter into any agreements or contracts with any commercial banks, trust companies or banking or other financial institutions within or outside the State that are necessary, desirable or convenient in the opinion of the bank to provide any other services to the bank to assist the bank in effectuating the purposes of this section.
The Treasurer of State may receive from the Federal Government any amount of money as appropriated, allocated, granted, turned over or in any way provided for the purposes of this subchapter. In connection with the financing of qualified transportation projects, these amounts must be credited to and deposited in the Federal Expenditures Fund and are available to the bank.
In addition to all other rights or remedies set forth in Title 30-A, section 6023, subsection 2, the trustee appointed pursuant to Title 30-A, section 6023 may, and upon written request of the holders of 25% in principal amount of all bonds then outstanding that have been issued to finance or refinance all or a portion of the costs of qualified transportation projects shall, in the trustee's or the bank's own name, by mandamus or other suit, action or proceeding at law or in equity, enforce all rights of the bondholders, including the right to require the bank to collect payments and other amounts and to collect interest and amortization payments under agreements payable to the bank and pledged to payment of the bonds adequate to carry out any agreement as to, or pledge of, those payments and other amounts and of such interest and amortization payments and to require the bank to carry out any other agreements with the bondholders and to perform its duties under this section.
Sec. P-2. Programmed GARVEE bonding level for 2008-2009 biennium. Notwithstanding any other provision of law and pursuant to the Maine Revised Statutes, Title 23, chapter 19, subchapter 3-A, the Maine Municipal Bond Bank may issue from time to time up to $50,000,000 of GARVEE bonds for projects programmed in the 2008-2009 biennium to be repaid solely from annual federal transportation appropriations for funding for qualified transportation projects.