Bill Text: AZ HB2452 | 2017 | Fifty-third Legislature 1st Regular | Chaptered
Bill Title: Bonding; amortized premium; segregated fund
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2017-03-29 - Chapter 99 [HB2452 Detail]
Download: Arizona-2017-HB2452-Chaptered.html
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House Engrossed |
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State of Arizona House of Representatives Fifty-third Legislature First Regular Session 2017
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CHAPTER 99
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HOUSE BILL 2452 |
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AN ACT
amending sections 11‑275, 15‑1022, 15-1024, 35-457, 35‑458, 35-471, 35‑473.01, 35-474, 42-17151, 48‑719, 48-806, 48-5563 and 48-5566, Arizona Revised Statutes; relating to the issuance of bonds.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 11-275, Arizona Revised Statutes, is amended to read:
11-275. Tax levy to pay bonds and interest; debt service fund; security
A. The board shall cause to be assessed and levied each year on the taxable property of the county, in addition to the levy authorized for other purposes, an amount sufficient to pay the interest on outstanding bonds and such proportion of the principal that at the end of five years the amount raised from the levy shall equal at least twenty percent of the amount of bonds issued, and at the end of nine years shall equal at least forty percent of the amount, and at and before the date of maturity of the bonds shall equal the whole amount of the principal and interest.
B. The money raised by the levy shall be known as the debt service fund and shall be used only for payment of bonds and interest coupons. The treasurer shall keep in his books a separate account thereof, which shall at all times show the exact condition of the debt service fund.
C. If there is not at any time sufficient monies in the fund to pay the interest due on the bonds, the board may transfer a sufficient sum from the general fund to the debt service fund for such purpose, and any excess in the fund over the amount required for principal and interest on the bonds may be transferred to the general fund.
D. All bonds, whenever heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy. The lien arises automatically without the need for any action or authorization by the county or the board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the county, the county's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 2. Section 15-1022, Arizona Revised Statutes, is amended to read:
15-1022. Tax levy for bonds; administration and disposition of tax; cancellation of paid bonds; security
A. The board of supervisors, at the time of making the levy of taxes for county purposes, shall levy a tax for the year upon on the taxable property in a school district or former school district canceled by election, which has outstanding school bonds for the interest and redemption of the bonds. The tax shall not be less than sufficient to pay the interest of the bonds for the year and the portion of the principal of the bonds becoming due during the year and in any event shall be enough to raise, annually, for the first half of the term of the bonds a sufficient amount to pay the interest thereon, and during the remainder of the term enough to pay the annual interest and to pay, annually, a portion of the principal of the bonds equal to an amount produced by taking the whole amount of bonds outstanding and dividing it by the number of years the bonds then have to run.
B. All monies, when collected, shall be paid into the county treasury to the credit of the debt service fund of the school district and shall be used only for payment of principal and interest on the bonds. The county treasurer shall keep the debt service fund separate from all other funds in the county treasury. The principal and interest on the bonds shall be paid by the county treasurer from the fund provided therefor.
C. The county treasurer or the treasurer's designated agent shall cancel all bonds and coupons when paid.
D. All bonds, whenever heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy. The lien arises automatically without the need for any action or authorization by the school district, the school district's governing board or the county treasurer. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the school district, the school district's governing board and the county treasurer, their successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 3. Section 15-1024, Arizona Revised Statutes, is amended to read:
15-1024. Interest on bonds; sale; disposition of proceeds; definition
A. The bonds shall bear interest, payable semiannually at the rate or rates set by the accepted bid, which shall not exceed the maximum rate of interest set forth in the resolution calling the election. The bonds may be made payable at such place within the United States as the governing board of the school district directs and shall be sold in the manner prescribed by the governing board of the school district for not less than par.
B. The proceeds of the sale of the bonds shall be deposited in the county treasury to the credit of the bond building fund of the school district. Such deposits may be drawn out for the purposes authorized by this article as other school monies are drawn. If a balance remains in the bond building fund after the acquisition or construction of facilities is completed for which the bonds were issued and on written request of the governing board:
1. If the school district has outstanding bonded indebtedness, the balance remaining in the bond building fund shall be transferred to the debt service fund of the district.
2. If the district has no outstanding bonded indebtedness, the balance remaining in the bond building fund shall be used for reduction of school district taxes.
C. When bonds are sold and the proceeds are not required to be used for a period of ten days or more, such proceeds may be invested as provided by section 15‑1025, subsection B. All monies earned as interest or otherwise derived from the investment of the proceeds of the sale of the bonds shall be credited to the debt service fund, except that on the request of the district, the monies earned as interest shall be deposited to the bond building fund if federal laws or rules require the interest to be used for capital expenditures or the monies earned as interest shall be credited to the bond building fund if the voters authorized such use of the monies in a separate question at the bond election. The separate question shall inform the voters that the monies will be credited to the debt service fund, and may therefore reduce the amount of the secondary property tax, if the measure authorizing the monies to be credited to the bond building fund does not pass.
D. The amount of net premium associated with a bond issue may be used only for one or more of the following:
1. To pay costs incurred in issuing the bonds, subject to sections section 15‑491, subsection G and section 15‑1465, subsection A.
2. As a deposit in a debt service fund and used only to pay interest on the bonds.
3. For any other purpose, if the district has voter authorization and available capacity under its debt limitations and the amount of net premium used for such purpose will reduce in an equal amount both:
(a) The available aggregate indebtedness capacity of the district under the statutes and constitution of this state.
(b) The principal amount authorized at the election for the district from which the issue of bonds are is being sold.
E. Any net premium used as provided in subsection D, paragraph 3 of this section shall be amortized for all debt limitation purposes on a pro rata basis each year by multiplying the net premium used by a percentage equal to the percentage of the total principal amount of the bond issue that matures in that year.
E. F. For the purposes of this section, "net premium" means the difference between the par amount of the bond issue and the bond issue price determined pursuant to United States treasury regulations.
Sec. 4. Section 35-457, Arizona Revised Statutes, is amended to read:
35-457. Sale of bonds; bids; forfeiture of deposit; definitions
A. Any or all of the bonds may be sold at public sale or through an online bidding process in a manner prescribed by the governing body or board that includes the following:
1. If sold by public sale before the sale of any bonds the governing body or board shall meet and enter on its record an order directing the sale of the bonds and the date and hour of the sale, and cause a copy of the order to be published at least once a week for two successive weeks in cities having a population of fifteen thousand or more persons, and once a week for four successive weeks in all other political subdivisions before the sale in one or more designated daily or weekly newspapers, together with a notice that sealed proposals will be received for purchase of the bonds on the date and hour named in the order.
2. If sold through an online bidding process, bids for the bonds that are entered into the system may be concealed until a specified time or disclosed in the online bidding process, may be subject to improvement in favor of the political subdivision before a specified time and may be for an entire issue of bonds or specified maturities according to the manner, terms and notice provisions ordered by the governing body.
B. If the bonds are sold by public sale or through an online bidding process, all proposals shall be received on the date and hour or in the manner stated in the order and the governing body or board shall award the bonds to the highest and most responsible bidder. The successful bidder shall provide a bid guarantee for not less than two percent of the total par value of the bonds within twenty‑four hours after the date and time the bid is awarded. The bid guarantee may be in the form of a certified check or a bond issued by a surety company licensed by the department of insurance to do business in this state. The governing body or board may reject any and all bids. If the successful bidder does not carry out the terms of the proposal to purchase the bonds, the bid guarantee shall be forfeited as stipulated and liquidated damages.
C. Notwithstanding any other provision of this section, bonds may be sold by negotiated sale on terms the governing body deems to be the best then available and may bear interest payable at such times as shall be determined by the governing body.
D. The bonds may be sold below, at or above par. If an issue of bonds is sold below par, the aggregate amount of discount plus interest to be paid on the bonds must not exceed the amount of interest that would be payable on the bonds over the maturity schedule prescribed by the governing body at the maximum rate set out in the resolution calling the election at which the bonds were voted. The amount of net premium associated with a bond issue may be used only for one or more of the following:
1. To pay costs incurred in issuing the bonds, subject to section 35‑452, subsection C.
2. As a deposit in a debt service fund and used only to pay interest on the bonds.
3. For any other purpose, if the political subdivision has voter authorization and available capacity under its debt limitations and the amount of net premium used for such purpose will reduce in an equal amount both:
(a) The available aggregate indebtedness capacity of the political subdivision under the statutes and constitution of this state.
(b) The principal amount authorized at the election for the political subdivision from which the issue of bonds are is being sold.
E. Any net premium used as provided in subsection D, paragraph 3 of this section shall be amortized for all debt limitation purposes on a pro rata basis each year by multiplying the net premium used by a percentage equal to the percentage of the total principal amount of the bond issue that matures in that year.
E. F. For the purposes of this section:
1. "Net premium" means the difference between the par amount of the bond issue and the bond issue price determined pursuant to United States treasury regulations.
2. "Online bidding process" means a procurement process in which the governing body receives bids electronically over the internet in a real‑time, competitive bidding event.
Sec. 5. Section 35-458, Arizona Revised Statutes, is amended to read:
35-458. Levy of tax for payment of bonds; security
A. After the bonds are issued, the governing body or board shall enter on its minutes a record of the bonds sold and their numbers and dates, and shall annually levy and cause to be collected a tax, at the same time and in the same manner as other taxes are levied and collected on all taxable property in such the political subdivision, sufficient to pay the annual interest on the bonds when due, and shall likewise annually levy a tax sufficient to redeem the bonds when they mature. The annual levy shall not exceed the net amount necessary to meet annual payments of principal and interest, projected payments of principal and interest on new debt planned for the ensuing year, a reasonable delinquency factor, including an amount necessary to correct prior year errors or shortages in the levy, if applicable, and any expenses and fees required in conjunction with the authorization pursuant to section 35‑512.
B. Monies derived from the levy of the tax when collected shall constitute a fund for payment of interest and the bonds. The fund shall be kept separately and shall be known as the "interest fund" and "redemption fund" or the two funds may be combined into a single "interest and redemption fund."
C. All bonds, whenever heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy. The lien arises automatically without the need for any action or authorization by the political subdivision or the political subdivision's governing body or board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the political subdivision, the political subdivision's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 6. Section 35-471, Arizona Revised Statutes, is amended to read:
35-471. Refunding bonds; resolution authorizing issuance; definition
A. The board of supervisors, on behalf of the county, the governing body of a city or town or similar municipal corporation and a school district governing board may issue refunding bonds to refund the bonded indebtedness of such county, school district, city or town or other similar municipal corporation when it is expedient to do so.
B. The board of supervisors or other governing body desiring to issue refunding bonds shall adopt and include in its minutes a resolution stating:
1. The facts and determination of the necessity or advisability of refunding such bonded indebtedness, including an estimate of the present value of the debt service savings, net of all costs associated with the refunding bonds, that will occur.
2. The amount of bonds to be issued, the date of such bonds and the denominations.
3. The rate of interest and the maturity date.
4. The place of payment, within or without the state, of the principal and interest.
C. The amount of net premium associated with a refunding bond issue may be used only for one or more of the following:
1. To fund the escrow account to pay the bonds to be refunded.
2. To pay the costs incurred in issuing the refunding bonds.
3. As a deposit in a debt service fund and used to pay interest on the bonds.
D. If the net premium associated with a refunding bond issue is used to fund the escrow account to pay the bonds to be refunded and the principal amount of the refunding bonds is less than the principal amount of the bonds being refunded, the difference between such principal amounts reduces the available aggregate indebtedness capacity of the political subdivision under the constitution and statutes of this state in an equal amount, provided that the difference in the amounts may not exceed the aggregate available indebtedness capacity of the political subdivision. The difference in principal amount will not cause any increase or decrease in the principal amount authorized pursuant to any bond election. Any net premium used as provided in this subsection shall be amortized for all debt limitation purposes on a pro rata basis each year by multiplying the net premium used by a percentage equal to the percentage of the total principal amount of the bond issue that matures in that year.
E. For the purposes of this section, "net premium" means the difference between the par amount of the bond issue and the bond issue price determined pursuant to United States treasury regulations.
Sec. 7. Section 35-473.01, Arizona Revised Statutes, is amended to read:
35-473.01. Refunding bonds issued in advance of maturity of the bonds to be refunded; definition
A. Refunding bonds, designated as such, may also be authorized, issued and sold pursuant to this article for the purpose of refunding any bonds theretofore issued under the authority of article 3 of this chapter or under the authority of both article 3 of this chapter and title 9, chapter 5, article 3 or under the authority of title 15, chapter 4, article 5 and chapter 9, article 7 or by any political subdivision that is a public, corporate body under the laws of this state the property of which is exempt from taxation, for the purpose of refunding any bonds, theretofore issued under authority of law and payable from the proceeds of taxes, including assessments, which may be levied annually at uniform rates and are secured by property subject thereto in the political subdivision, in advance of the maturity or call date of such bonds to be refunded. If the weighted average maturity of the refunding bonds is at least seventy-five percent of the weighted average maturity of the bonds being refunded, no election on the issuance of the refunding bonds shall be required. If the refunding bonds are combined into a single issue with bonds authorized for nonrefunding purposes, the bonds so authorized for nonrefunding purposes shall have been submitted at an election as otherwise provided by law.
B. When refunding bonds issued pursuant to this section are sold, the net proceeds shall be invested in obligations issued by or guaranteed by the United States government, if these investments will mature with interest so as to provide funds to pay when due, or called for redemption, the bonds to be refunded together with interest thereon and redemption premiums, if any, and such proceeds or obligations shall, and other funds legally available for such purposes may, be deposited in the respective principal and interest redemption funds and shall be held in trust for the payment of the refunded bonds with interest and redemption premiums, if any, on maturity or upon an available redemption date or on an earlier voluntary surrender with the consent of the issuer.
C. For bonds that are issued to refund outstanding bonds that are issued before September 1, 2016, in advance of the maturity dates of such bonds, the holder of the refunding bonds shall rely on the sufficiency of the funds or securities held in trust for the payment of the refunded bonds. The issuance of refunding bonds shall in no way infringe on the rights of the holder of the refunded bonds to rely on a tax levy for the payment of principal and interest on the refunded bonds if the investments in the redemption funds prove insufficient. The total aggregate of taxes levied to pay principal and interest on the refunding bonds in the aggregate shall not exceed the total aggregate principal and interest to become due on the refunded bonds from the date of issuance of the refunding bonds to the final date of maturity on the bonds being refunded. Subject to such limitation, taxes in an amount sufficient to pay the interest on all refunding bonds issued pursuant to this section, then outstanding, the installments of the principal thereof becoming due and payable in the ensuing year, and the annual portion of such sinking fund as may be set up for retirement thereof, shall be levied, assessed and collected as other taxes of the political subdivision and the proceeds therefrom kept in a special fund and used only for the purposes for which collected.
D. For bonds that are issued to refund or refinance bonds that are issued from and after August 31, 2016, in advance of the maturity dates of such bonds, the holder of the refunded bonds shall rely on the sufficiency of the funds or securities held in trust for the payment of the refunded bonds. To the extent that payment of amounts on the refunded bonds is provided for by the deposit of funds and securities held in trust for the payment of the refunded bonds, all obligations of the political subdivision to levy a tax for the payment of such amounts shall cease and terminate. The refunded bonds shall in no way infringe on the rights of the holders of the refunding bonds to rely on a tax levy for the payment of principal of and interest on the refunding bonds if the investments in the redemption funds prove insufficient. The total aggregate of taxes levied to pay principal of and interest on the refunding bonds in the aggregate shall not exceed the total aggregate principal and interest to become due on the refunded bonds from the date of issuance of the refunding bonds to the final date of maturity on the bonds being refunded. Subject to such limitation, taxes in an amount sufficient to pay the interest on all refunding bonds issued pursuant to this section, then outstanding, the installments of the principal thereof becoming due and payable in the ensuing year, and the annual portion of such sinking fund as may be set up for retirement thereof, shall be levied, assessed and collected as other taxes of the political subdivision and the proceeds therefrom kept in a special fund and used only for the purposes for which collected.
E. Proceedings pursuant to this section shall be had by the board or boards that would be authorized to issue and sell the bonds to be refunded if such bonds were then to be issued and sold. The refunding bonds to be issued pursuant hereto may be of serial, including semiannual, or term maturities payable at any time on or before the maximum maturity date otherwise authorized by this article, and the provisions relating to execution, validity, records, place of payment and payment, cancellation and destruction on maturity of the bonds to be refunded shall apply to such refunding bonds.
F. Refunding bonds to be issued pursuant to this section may be combined with bonds otherwise authorized, provided that they are of equal priority.
G. The powers conferred by this section are in addition to, and not in substitution of, and the limitations imposed by this section shall not affect the powers conferred by any other law.
H. The amount of net premium associated with a refunding bond issue may be used only for one or more of the following:
1. To fund the escrow account to pay the bonds to be refunded.
2. To pay the costs incurred in issuing the refunding bonds.
3. As a deposit in a debt service fund and only to pay interest on the bonds.
I. If the net premium associated with a refunding bond issue is used to fund the escrow account to pay the bonds to be refunded and the principal amount of the refunding bonds is less than the principal amount of the bonds being refunded, the difference between such principal amounts reduces the available aggregate indebtedness capacity of the political subdivision under the constitution and statutes of this state in an equal amount, provided that the difference in the amounts may not exceed the aggregate available indebtedness capacity of the political subdivision. The difference in principal amount will not cause any increase or decrease in the principal amount authorized pursuant to any bond election. Any net premium used as provided in this subsection shall be amortized for all debt limitation purposes on a pro rata basis each year by multiplying the net premium used by a percentage equal to the percentage of the total principal amount of the bond issue that matures in that year.
J. For the purposes of this section, "net premium" means the difference between the par amount of the bond issue and the bond issue price determined pursuant to United States treasury regulations.
Sec. 8. Section 35-474, Arizona Revised Statutes, is amended to read:
35-474. Levy of tax for payment of bonds
A. The board of supervisors, on behalf of the county or a school district in the county, or the governing body or board of a municipal corporation that has issued refunding bonds shall levy, during each year in which the bonds are outstanding, a tax on all property in the political subdivision for which the bonds are issued, sufficient to pay the annual interest on all bonds then outstanding and the annual installment of the principal thereof becoming due and payable in the next ensuing year. The annual levy shall not exceed the net amount necessary to meet annual payments of principal and interest, projected payments of principal and interest on new debt planned for the ensuing year, a reasonable delinquency factor, including an amount necessary to correct prior year errors or shortages in the levy, if applicable, and any expenses and fees required in conjunction with the authorization pursuant to section 35‑512. Such taxes shall be levied, assessed and collected at the same time and in the same manner as other taxes are levied, assessed and collected. The proceeds of the taxes shall be kept in a special segregated fund and shall be used only for the purpose for which collected.
B. All bonds, heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy. The lien arises automatically without the need for any action or authorization by the political subdivision or the political subdivision's governing body or board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the political subdivision, the political subdivision's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 9. Section 42-17151, Arizona Revised Statutes, is amended to read:
42-17151. County, municipal, community college and school tax levy
A. On or before the third Monday in August each year, the governing body of each county, city, town, community college district and school district shall:
1. Fix, levy and assess the amount to be raised from primary property taxation and secondary property taxation. This amount, plus all other sources of revenue, as estimated, and restricted and unrestricted unencumbered balances from the preceding fiscal year, shall equal the total of amounts proposed to be spent in the budget for the current fiscal year.
2. Designate the amounts to be levied for each purpose appearing in the adopted budget.
3. Fix and determine a primary property tax rate and a secondary property tax rate, each rounded to four decimal places on each one hundred dollars of taxable property shown by the finally equalized valuations of property, less exemptions, that appear on the tax rolls for the fiscal year, as determined by the assessor on or before February 10 of the tax year pursuant to section 42‑17052, and that when extended on those valuations will produce, in the aggregate, the entire amount to be raised by direct taxation for that year. Amounts levied for debt service on bonds payable from the secondary tax are and shall be considered special revenues of the county, city, town or district, shall be kept in a special, segregated fund, are not and shall not be general property taxes and may not be used for any other purpose of the county, city, town or district.
B. The governing body of a county, city, town or community college district shall not fix, levy or assess an amount of primary property taxes in excess of the amount permitted by section 42‑17051, subsection A, paragraph 7 or section 42‑17005 as determined by the property tax oversight commission.
C. The governing board of a common school district, a high school district or a unified school district shall not fix, levy or assess a primary property tax rate higher than the current year's rate if the district meets both of the following criteria, as determined by the property tax oversight commission:
1. The total primary property taxes levied for all taxing jurisdictions on at least one-half of the residential property of the district exceed the limitation described in section 15‑972, subsection E.
2. The school district primary property tax rate exceeds one hundred fifty per cent of the applicable qualifying tax rate pursuant to section 41‑1276.
D. No later than December 31, the property tax oversight commission shall notify those school districts that meet the criteria described in subsection C of this section and the county school superintendents and boards of supervisors of the counties in which the school districts are located.
E. Within three days after the final levies are determined for a county, city, town or community college district, the chief county fiscal officer shall notify the property tax oversight commission of the amount of the primary property tax levied.
F. Pursuant to section 15‑465.01, subsection E, an accommodation school governing board shall not levy a primary or secondary property tax. The property tax oversight commission shall consider any amount of property tax levied by a county in support of an accommodation school to be part of the county's primary levy for the purposes of determining the county's compliance with subsection B of this section.
Sec. 10. Section 48-719, Arizona Revised Statutes, is amended to read:
48-719. General obligation bonds; tax levy; security
A. At any time after the hearing on formation of the district, the district board, or, if before formation, the governing body, may from time to time order and call a general obligation bond election to submit to the qualified electors of the district or to those persons who are qualified to vote pursuant to section 48‑707, subsection G the question of authorizing the district board to issue general obligation bonds of the district to provide monies for any public infrastructure purposes consistent with the general plan. The election may be held in conjunction with the formation election.
B. If general obligation bonds are approved at an election, the district board may issue and sell general obligation bonds of the district.
C. The district may issue and sell refunding bonds to refund any general obligation bonds of the district. If general obligation bonds are issued to refund any general obligation bonds of the district, no an election on the issuance of such refunding bonds is not required.
D. After the bonds are issued, the district board shall enter in its minutes a record of the bonds sold and their numbers and dates and shall annually levy and cause an ad valorem tax to be collected, at the same time and in the same manner as other taxes are levied and collected on all taxable property in the district, sufficient, together with any monies from the sources described in section 48‑717, to pay debt service on the bonds when due. Monies derived from the levy of the tax provided in this section when collected constitute funds to pay the debt service on the bonds and shall be kept separately from other funds of the district. Amounts levied for debt service on bonds payable from the secondary tax are and shall be considered special revenues of the district, shall be kept in a special, segregated fund, are not and shall not be general property taxes and may not be used for any other purpose of the district.
E. All bonds, whenever heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy. The lien arises automatically without the need for any action or authorization by the district or the district board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the district, the district's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 11. Section 48-806, Arizona Revised Statutes, is amended to read:
48-806. Bond election; issuance and sale of bonds
A. Except for a district formed pursuant to section 48‑851, the district board or the elected chief and secretary‑treasurer may order an election by the qualified electors of the district to be held pursuant to title 16, chapter 2, article 1 to determine whether bonds shall be issued on behalf of the district. The order shall specify the maximum principal amount of bonds to be issued, the maximum number of years bonds of any issue or series may run from their date not exceeding thirty years, the purpose for which the bonds are to be issued, the maximum rate of interest which that the bonds are to bear, the date and hours of the election and the location of the polling places. Copies of the order shall be posted in three public places within the district not less than twenty days prior to the date of the election, and if a newspaper is published within the county having a general circulation within the district, the order shall be published in the newspaper not less than once a week during each of the three calendar weeks preceding the calendar week of the election.
B. A district board formed pursuant to section 48‑851 shall not order an election for or issue bonds under this section.
C. Instead of publishing the notice described in subsection A of this section, the board of directors may mail a notice of election to each household containing a qualified elector of the district. The notice shall contain the same information described in subsection A of this section except that the notice shall not contain the location of all the polling places for that election. The notice shall contain the location of the polling place for that household's qualified electors. The notice shall be mailed at least thirty-five days before the election.
D. At the election the ballot shall contain the phrases "for the bonds" and "against the bonds". There shall be placed a square or other designated marking space in the same manner as used for candidates on ballots. The voter shall indicate a vote "for the bonds" or "against the bonds". No other question, word or figure need be printed on the ballot. The ballot need not be any particular size, nor need sample ballots be printed, posted or distributed but ballots shall comply with standards otherwise provided by law, including requirements for electronic voting, if applicable.
E. If a majority of the qualified electors of the district voting at the election approves the issuance of bonds, the district board or the elected chief and secretary‑treasurer, as appropriate, may issue bonds in an aggregate principal amount not exceeding the lesser of six per cent percent of the value of the taxable property in the district as shown on the last property tax assessment roll before issuing the bonds or the maximum amount specified in the election order.
F. Bonds may be in such denominations, may be in registered or bearer form either as to principal or interest, or both, may mature at such times not exceeding the maximum maturity specified in the election order and may be subject to redemption prior to maturity, all as specified by the district board or elected chief and secretary‑treasurer, as appropriate, as provided in subsection E of this section. The district may engage the services of a depository to administer a book entry system for the bonds. The costs and expenses of such depository and any registrar or paying agent for the bonds shall be deemed to be interest expenses that may also be paid from the tax levy made pursuant to subsection I of this section.
G. Bonds shall be executed by the manual or facsimile signatures of the chairman and clerk of the district board or elected chief and secretary‑treasurer of the district. Coupons attached to the bonds shall bear the facsimile signature of the chairman of the district board or the elected chief of the district, as appropriate.
H. The district board may sell the bonds at public or private sale or through an on-line online bidding process. In addition, the district board may negotiate loan agreements or loan repayment agreements with the greater Arizona development authority in lieu of selling bonds where authority to sell bonds has been granted by the district's voters. The proceeds of sale on the bonds shall be deposited in an account of the fire district fund to be known as the capital fund to be applied for the purpose for which the bonds were issued.
I. After the bonds are issued, the district board or elected chief and secretary-treasurer, as appropriate, shall enter on the district's minutes a record of the bonds sold and shall annually determine the amount of the tax levy to pay the bonds and certify such amount to the board of supervisors of the county. The board of supervisors shall annually cause to be levied and collected a tax, at the same time and in the same manner as other taxes are levied and collected upon on all taxable property in the district, sufficient to pay principal of and interest on the bonds as they become due and payable. Monies derived from the levy of the tax when collected shall be deposited in the debt service fund and shall be applied only to payment of the principal of and interest on the bonds. On payment of the outstanding bonded indebtedness of the district, any monies remaining in the debt service fund shall be used to reduce the district's property tax levy in the next fiscal year. Amounts levied for debt service on bonds issued pursuant to this section payable from the secondary tax are and shall be considered special revenues of the district, shall be kept in a special, segregated fund, are not and shall not be general property taxes and may not be used for any other purpose of the district.
J. All bonds, heretofore and hereafter issued, are secured by a lien on all revenues received pursuant to the tax levy made pursuant to subsection I of this section. The lien arises automatically without the need for any action or authorization by the district or the district's governing board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to the levy of the tax made pursuant to subsection I of this section are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the district, the district's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
Sec. 12. Section 48-5563, Arizona Revised Statutes, is amended to read:
48-5563. Budget and tax levy
A. On or before July 15 of each year, the board of directors shall furnish to the board of supervisors a report of the operation of the district for the past year and a written statement of the amount of money needed to be raised by taxation during the next fiscal year for all operating purposes of the district, including maintaining and operating the district's facilities, payments for professional and other services to the district, debt service, including principal and interest on any bonds issued and outstanding pursuant to section 48‑5566 and intergovernmental transfers in connection with special payments, and any other purpose required or authorized by this chapter.
B. The board of supervisors shall thereupon levy on the taxable property in the district a secondary tax that, together with other monies on hand or that will accrue during the ensuing fiscal year, exclusive of reserves and taxes levied in connection with bonds issued pursuant to section 48‑5566, will provide sufficient revenues to meet the financial needs of the district as provided in subsection A of this section.
C. The secondary tax shall be computed, entered on the tax rolls and collected in the same manner as other secondary property taxes in the county in which the district is located. Monies collected on behalf of the district shall be remitted promptly to and shall be handled by the county treasurer as other special district monies are handled. Amounts levied for debt service on bonds issued pursuant to section 48-5566 or reserves for the bonds maintained pursuant to section 48-5567 are and shall be considered special revenues of the district, shall be kept in a special, segregated fund, are not and shall not be general property taxes and may not be used for any other purpose of the district.
Sec. 13. Section 48-5566, Arizona Revised Statutes, is amended to read:
48-5566. Issuing bonds; election
A. On the approval of a majority of the qualified electors, a special health care district may issue bonds to carry out any of the provisions of this article. If the board of directors determines that bonds should be issued, the board of directors shall apply to the board of supervisors, and the board of supervisors shall submit to a vote of the qualified electors residing in the district the question in the manner prescribed by title 35, chapter 3, article 3. The election must be held on the first Tuesday following the first Monday in November as prescribed by section 16-204, subsection B, paragraph 1, subdivision (d) F.
B. If a majority of the qualified electors voting on the issue approves the issue, the bonds shall be issued as provided by law.
C. All bonds, heretofore and hereafter issued pursuant to this section, are secured by a lien on the special revenues received pursuant to section 48-5563, subsection C. The lien arises automatically without the need for any action or authorization by the district or the district's governing board. The lien is valid and binding from the time of the issuance of the bonds. The revenues received pursuant to section 48-5563, subsection C are immediately subject to the lien. The lien attaches immediately to the revenues and is effective, binding and enforceable against the district, the district's successors, transferees and creditors and all other parties asserting rights in the revenues, irrespective of whether the parties have notice of the lien, without the need for any physical delivery, recordation, filing or further act.
APPROVED BY THE GOVERNOR MARCH 29, 2017.
FILED IN THE OFFICE OF THE SECRETARY OF STATE MARCH 29, 2017.
