| 1 | A bill to be entitled |
| 2 | An act relating to local government revenue interception; |
| 3 | creating s. 218.387, F.S.; providing a short title; |
| 4 | providing definitions; authorizing local governments to |
| 5 | authorize by resolution or ordinance the Department of |
| 6 | Revenue to intercept certain available revenues of the |
| 7 | local government for certain purposes; specifying |
| 8 | ordinance or resolution required provisions; requiring the |
| 9 | local government to provide a copy of the ordinance or |
| 10 | resolution to the department and the Division of Bond |
| 11 | Finance of the State Board of Administration; specifying |
| 12 | administrative requirements for the department; specifying |
| 13 | criteria for a local government's available revenues |
| 14 | eligible for interception; specifying purposes and uses of |
| 15 | intercepted available revenues; specifying notice |
| 16 | requirements for the trustee or paying agent for local |
| 17 | government bonds subject to an intercept program; |
| 18 | providing notice requirements for termination of local |
| 19 | government bonds subject to an intercept program; |
| 20 | specifying department requirements for intercepting a |
| 21 | local government's available revenues for certain |
| 22 | purposes; specifying construction and criteria for a local |
| 23 | government's bonds operating under an intercept program, |
| 24 | revenues payable under such bonds, and the intercept |
| 25 | program; specifying a state covenant to not take certain |
| 26 | actions to abrogate certain rights or protections; |
| 27 | authorizing the department to adopt forms and rules; |
| 28 | providing an effective date. |
| 29 |
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| 30 | Be It Enacted by the Legislature of the State of Florida: |
| 31 |
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| 32 | Section 1. Section 218.387, Florida Statutes, is created |
| 33 | to read: |
| 34 | 218.387 Florida Local Government Revenue Intercept Act.- |
| 35 | (1) This section may be cited as the "Florida Local |
| 36 | Government Revenue Intercept Act." |
| 37 | (2) As used in this section: |
| 38 | (a) "Available revenues" means a local government's funds |
| 39 | derived from the communications services tax, the local |
| 40 | government half-cent sales tax, the local option fuel tax, or |
| 41 | revenue sharing. |
| 42 | (b) "Bonds" means any bond, loan, promissory note, lease- |
| 43 | purchase agreement, certificate of participation, installment |
| 44 | sale, lease, or other similar financing mechanism or financial |
| 45 | arrangement, whether or not a debt for legal purposes, of a |
| 46 | local government. |
| 47 | (c) "Communications services tax" means the communications |
| 48 | services tax collected pursuant to chapter 202 for distribution |
| 49 | to local governments. |
| 50 | (d) "Department" means the Department of Revenue. |
| 51 | (e) "Intercept program" means an authorized intercept |
| 52 | process for a local government's available revenues as provided |
| 53 | in subsection (3). |
| 54 | (f) "Local government" means any county or municipality, |
| 55 | or any county or municipality that individually or collectively |
| 56 | participates with a separate legal entity created under s. |
| 57 | 163.01 for the purpose of financing or refinancing bonds and the |
| 58 | separate legal entity. |
| 59 | (g) "Local government half-cent sales tax" means the local |
| 60 | government half-cent sales tax collected pursuant to part VI of |
| 61 | this chapter for distribution to local governments. |
| 62 | (h) "Local option fuel tax" means any optional fuel tax |
| 63 | collected pursuant to chapter 206 for distribution to local |
| 64 | governments. |
| 65 | (i) "Revenue sharing" means the funds available pursuant |
| 66 | to part II of this chapter for distribution to local |
| 67 | governments. |
| 68 | (3)(a) A local government may, by resolution or ordinance, |
| 69 | authorize the department to intercept the local government's |
| 70 | available revenues as specified in this section. The resolution |
| 71 | or ordinance must: |
| 72 | 1. Specifically authorize the department to intercept |
| 73 | available revenues collected or held by the state for the local |
| 74 | government and use such revenues to replenish the debt service |
| 75 | reserve or other similar payment account for bonds of the local |
| 76 | government when the local government has failed to make a |
| 77 | required debt service payment or other similar payment and when |
| 78 | the account for the bonds has been drawn upon to make a debt |
| 79 | service or other similar payment. |
| 80 | 2. Specifically authorize the department to intercept |
| 81 | available revenues that have not been pledged to any other |
| 82 | current or future bonds of the local government. |
| 83 | 3. Specifically authorize the department to intercept any |
| 84 | available revenues in the following order as revenues are |
| 85 | needed: |
| 86 | a. Funds derived from revenue sharing that are restricted |
| 87 | under s. 218.25(4) and not permitted to be assigned, pledged, or |
| 88 | set aside for debt service or other similar payment. |
| 89 | b. Funds derived from the local government half-cent sales |
| 90 | tax. |
| 91 | c. Funds derived from the communications services tax. |
| 92 | d. Funds derived from a local option fuel tax, provided |
| 93 | the bonds relate to an authorized use of such funds. |
| 94 | e. Any remaining funds derived from revenue sharing. |
| 95 | 4. Specify the trustee or paying agent for the local |
| 96 | government's bonds, specifically authorize the department to |
| 97 | receive and act on requests by the trustee or paying agent to |
| 98 | intercept available revenues of the local government, and |
| 99 | acknowledge that the local government is responsible for |
| 100 | informing the department of any changes to the trustee or paying |
| 101 | agent for the bonds within 30 days after such change. |
| 102 | 5. Require the local government's bonds to have a cash- |
| 103 | funded debt service or other similar payment reserve equal to |
| 104 | the maximum annual debt service or other similar payment, and |
| 105 | require that payment dates for principal and interest for the |
| 106 | bonds be no more frequent than quarterly. |
| 107 | 6. Inform the department of the debt service or other |
| 108 | similar payment schedule for the local government's bonds. |
| 109 | 7. Provide that the local government has reasonably |
| 110 | determined in good faith that anticipated available revenues in |
| 111 | each fiscal year during the term or length of the local |
| 112 | government's bonds will be at least 1.75 times the maximum |
| 113 | annual amount of debt service or other similar payment on the |
| 114 | bonds. |
| 115 | 8. Acknowledge that the local government shall not amend |
| 116 | or repeal the resolution or ordinance establishing the intercept |
| 117 | program without the concurrence of a majority of the purchasers, |
| 118 | holders, and owners of the local government's bonds, or any |
| 119 | entity authorized to act on the behalf of the purchasers, |
| 120 | holders, and owners of the bonds. |
| 121 | 9. Acknowledge that the resolution or ordinance |
| 122 | authorizing the intercept program shall be included and made a |
| 123 | part of the bond resolution or other agreement for the bonds. |
| 124 | (b) The local government shall provide a copy of the |
| 125 | ordinance or resolution to the department and to the Division of |
| 126 | Bond Finance of the State Board of Administration. Within 30 |
| 127 | days after receipt of the ordinance or resolution, the |
| 128 | department shall acknowledge and accept the ordinance or |
| 129 | resolution after the department has determined that the |
| 130 | ordinance or resolution contains all the required authorizations |
| 131 | and information as specified in this subsection, or the |
| 132 | department shall inform the local government in writing of any |
| 133 | deficiencies with the ordinance or resolution. |
| 134 | (4) A local government's funds as restricted under revenue |
| 135 | sharing under s. 218.25(4) and not permitted to be assigned, |
| 136 | pledged, or set aside for debt service or other similar payment |
| 137 | shall be available revenue subject to being intercepted as |
| 138 | provided in this section. Available revenues under an intercept |
| 139 | program to the extent of 1.75 times the maximum annual amount of |
| 140 | debt service or other similar payment on the local government's |
| 141 | bonds are provided solely to prevent a default on the bonds and |
| 142 | shall not be considered in any calculation for additional bonds |
| 143 | of a local government. The department shall implement only the |
| 144 | specific provisions of this section and shall not be responsible |
| 145 | for providing demographic or revenue history of the local |
| 146 | government. The local government and trustee or paying agent |
| 147 | shall jointly inform the department of the termination of the |
| 148 | local government's bonds subject to the intercept program. |
| 149 | (5) The trustee or paying agent for local government bonds |
| 150 | subject to an intercept program shall provide the department and |
| 151 | local government with at least 60 days' written notice of the |
| 152 | need to intercept the local government's available revenues, the |
| 153 | exact amount of revenues to be intercepted, and the date the |
| 154 | intercepted revenues are to be deposited with the trustee or |
| 155 | paying agent along with wiring or other instructions to transmit |
| 156 | the revenues. Upon receiving the notice, the department shall |
| 157 | intercept the local government's available revenues to the |
| 158 | extent such revenues are otherwise required to be distributed to |
| 159 | the local government by the department and shall transmit such |
| 160 | revenues as specified by the trustee or paying agent in a timely |
| 161 | manner. The department shall be paid for all costs the |
| 162 | department incurs in administering this section. |
| 163 | (6) A local government's bonds subject to an intercept |
| 164 | program shall not constitute an obligation of the state, a debt |
| 165 | of the state, or a pledge of the full faith and credit or taxing |
| 166 | power of the state. Revenues payable under an intercept program |
| 167 | are payable only from available revenues as provided in this |
| 168 | section. An intercept program does not constitute the assumption |
| 169 | by the state of any debt of a local government. The state hereby |
| 170 | covenants with the purchasers, holders, and owners of bonds |
| 171 | covered under an intercept program authorized by this section |
| 172 | that the state will not repeal, revoke, rescind, modify, or |
| 173 | amend provisions of this section in a manner that would abrogate |
| 174 | the rights or protections under this section of such purchasers, |
| 175 | holders, and owners of bonds. |
| 176 | (7) The department may adopt forms or rules to implement |
| 177 | the provisions of this section. |
| 178 | Section 2. This act shall take effect upon becoming a law. |