WEST virginia
legislature
2017 Third
extraordinary session
By
[By Request of the Executive]
[
AN ACT to amend and
reenact §17-3-1 of the Code of West Virginia, 1931, as amended; and to amend
said code by adding thereto a new article, designated §17-26A-1,
§17-26A-2, §17-26A-3, §17-26A-4, §17-26A-5, §17-26A-6, §17-26A-7, §17-26A-8,
§17-26A-9, §17-26A-10, §17-26A-11, §17-26A-12, §17-26A-13 and §17-26A-14, all
relating generally to state road bonds; requiring proceeds from the sale of
state road bonds issued pursuant to Roads to Prosperity Amendment of 2017 to be
kept in separate and distinct account in the State Road Fund; authorizing cost
of issuance to be paid from State Road Fund; providing definitions; authorizing
sale of bonds; providing schedule for sale of bonds; providing amount of bonds
to be sold; providing conditions on the sale and issuance of bonds; creating
the Roads to Prosperity Bond Debt Service Fund; authorizing investment of the
fund; providing bond covenants; requiring certification of annual debt service
amount; prohibiting conflicts of interest; creating a criminal misdemeanor
offense and providing penalties for the proceeds from the sale of bonds to
inure to the benefit of or be distributed to officers or employees of the state
except to pay reasonable compensation for services rendered; declaring state
road bonds lawful investments; allowing for the refund of bonds; allowing for
continuity of debt service in termination or dissolution; authorizing the
Treasurer to select financial advisor; authorizing the Governor to select bond
counsel and underwriter; allowing for payment of necessary expenses for
issuance from funds; dedicating tax and fee collections for debt service; and
setting a schedule for certain deposits into the Roads to Prosperity Bond Debt
Service Fund.
Be it enacted by the
Legislature of West Virginia:
That §17-3-1 of the
Code of West Virginia, 1931, as amended, be amended and reenacted; and that
said code be amended by adding thereto a new article, designated §17-26A-1,
§17-26A-2, §17-26A-3, §17-26A-4, §17-26A-5, §17-26A-6, §17-26A-7, §17-26A-8,
§17-26A-9, §17-26A-10, §17-26A-11, §17-26A-12, §17-26A-13 and §17-26A-14, all
to read as follows:
ARTICLE 3. STATE ROAD
FUND.
§17-3-1. What
constitutes fund; payments into fund; use of money in fund.
There shall be a State Road
Fund, which shall consist of the proceeds of all state license taxes imposed
upon automobiles or other motor or steam driven vehicles; the registration fees
imposed upon all owners, chauffeurs, operators and dealers in automobiles or
other motor driven vehicles; all sums of money which may be donated to such
fund; all proceeds derived from the sale of state bonds issued pursuant to any
resolution or act of the Legislature carrying into effect the Better Roads
Amendment to the Constitution of this state, adopted in November, 1964, except
that the proceeds from the sale of these bonds shall be kept in a separate and distinct
account in the State Road Fund; all proceeds from the sale of state bonds
issued pursuant to any resolution or act of the Legislature carrying into
effect the Safe Roads Amendment of 1996 to the Constitution of this state,
adopted in November, 1996, except that the proceeds from the sale of these
bonds shall be kept in a separate and distinct account in the State Road Fund; all
proceeds from the sale of state bonds issued pursuant to any resolution or act
of the Legislature carrying into effect the Roads to Prosperity Amendment of
2017 to the Constitution of this state, adopted in October, 2017, except that
the proceeds from the sale of these bonds shall be kept in a separate and
distinct account in the State Road Fund; all moneys and funds appropriated to
it by the Legislature; and all moneys allotted or appropriated by the federal
government to this state for road construction and maintenance pursuant to any
act of the Congress of the United States; the proceeds of all taxes imposed
upon and collected from any person, firm or corporation and of all taxes or
charges imposed upon and collected from any county, district or municipality
for the benefit of the fund; the proceeds of all judgments, decrees or awards
recovered and collected from any person, firm or corporation for damages done
to, or sustained by, any of the state roads or parts thereof; all moneys
recovered or received by reason of the violation of any contract respecting the
building, construction or maintenance of any state road; all penalties and
forfeitures imposed, recovered or received by reason thereof; and any and all
other moneys and funds appropriated to, imposed and collected for the benefit
of such fund, or collected by virtue of any statute and payable to such fund: Provided,
That notwithstanding any provisions of this code to the contrary, 50 cents of
every license fee paid pursuant to the provisions of subdivision (2),
subsection (a), section eight, article two, chapter seventeen-b of this code
shall be paid to the special fund established pursuant to the provisions of
subsection (a), section twelve, article two, chapter three of this code.
When any money is collected
from any of the sources aforesaid, it shall be paid into the State Treasury by
the officer whose duty it is to collect and account for the same, and credited
to the State Road Fund, and shall be used only for the purposes named in this
chapter, which are: (a) To pay the principal and interest due on all state
bonds issued for the benefit of said fund, and any costs related to the
issuance thereof, and set aside and appropriated for that purpose; (b) to pay
the expenses of the administration of the Division of Highways; and (c) to pay
the cost of maintenance, construction, reconstruction and improvement of all
state roads.
article 26a. roads to
prosperity state road bonds.
§17-26A-1. Definitions.
For purposes of this
article:
(1) “Commissioner” means
the West Virginia Commissioner of Highways continued pursuant to section one,
article two-a of this chapter;
(2) “Amendment” means the
amendment to the Constitution of this state entitled Roads to Prosperity
Amendment of 2017 as approved by referendum in October, 2017;
(3) “State road bond” means
any bond or bonds issued by the state pursuant to section two of this article;
(4) “Division” means the
West Virginia Division of Highways established under section one, article two-a
of this chapter, or any successor to all or any substantial part of its powers
and duties; and
(5) “Secretary” means the
Secretary of the West Virginia Department of Transportation.
§17-26A-2. State road
general obligation bonds; amount; when may issue.
(a) Bonds of the State of
West Virginia, under authority of the Roads to Prosperity Amendment of 2017 of
the principal amount not to exceed in the aggregate $1.6 billion are authorized
to be issued and sold for matching available federal funds for highway and
bridge construction in this state and for general highway and secondary roads
and bridge construction or improvements in each of the fifty-five counties in
this state, as provided for by the Constitution and the provisions of this
article. During the fiscal year beginning July 1, 2017, the principal amount of
$800 million in bonds may be sold.
During the fiscal year beginning July 1, 2018, the principal amount of
$400 million in bonds may be sold. During the fiscal year beginning July 1,
2019, the principal amount of $200 million in bonds may be sold. During the fiscal year beginning July 1,
2020, the principal amount of $200 million in bonds may be sold. Any amount not sold in a fiscal year may be
carried forward and issued in any subsequent year before July 1, 2021.
(b) These bonds may be
issued by the Governor upon resolution passed by the Legislature authorizing
the same. The bonds shall bear the date and mature at the time, bear interest
at the rates, be in amounts, be in denominations, be in the registered form,
carry registration privileges, be due and payable at the times and place and in
amounts, and be subject to terms of redemption as the resolution may allow.
(c) Both the principal and
interest of the bonds shall be payable in the lawful money of the United States
of America, and the bonds and the interest thereon shall be exempt from
taxation by the State of West Virginia, or by any county, district or
municipality thereof, which fact shall appear on the face of the bonds as part
of the contract with the holder of the bond.
(d) The bonds shall be
executed on behalf of the State of West Virginia, by the manual or facsimile
signature of the Governor, under the Great Seal of the State or a facsimile of
the Great Seal, and countersigned by the manual or facsimile signature of the Secretary
of State.
§17-26A-3. Creation of
debt service fund to pay debt service on state road general obligation bonds.
There is hereby created a
special account in the State Treasury, which shall be designated and known as
the Roads to Prosperity Bond Debt Service Fund, into which shall be deposited
any and all amounts appropriated by the Legislature from the State Road Fund or
funds from any source whatsoever which is made liable by law for the purpose of
paying the interest on the bonds or paying off and retiring bonds issued
pursuant to this article.
§17-26A-4. Roads to Prosperity
Bond Debt Service Fund; sources used to pay bonds, interest and cost of
issuance; investment of remainder.
(a) All funds deposited to
the credit of the Roads to Prosperity Bond Debt Service Fund shall be kept by
the State Treasurer in a separate account, and all money belonging to the fund
shall be deposited in the Treasury to the credit of the fund.
(b) The fund shall be
applied by the State Treasurer for payments on the principal and interest on
bonds sold pursuant to this article as it becomes due and payable and any costs
related to the issuance thereof. The remainder of the fund, if any, shall be
invested by the West Virginia Board of Treasury Investments in the manner authorized
under article six-c, chapter twelve of this code.
§17-26A-5. Covenants of
state.
The State of West Virginia
covenants and agrees with the holders of the bonds issued pursuant hereto as
follows: (1) That the bonds are a direct and general obligation of the State of
West Virginia; (2) that the full faith and credit of the state is pledged to
secure the payment of the principal and interest of the bonds; (3) that an
annual state tax shall be collected in an amount sufficient to pay, as it may
accrue, the interest on the bonds and the principal thereof; and (4) that the
tax shall be levied in any year only to the extent that the moneys transferred
to the Roads to Prosperity Bond Debt Service Fund as provided in sections three
and four of this article which are irrevocably set aside and appropriated for
and applied to the payment of the interest on and principal of any bond
becoming due and payable in such year are insufficient therefor.
§17-26A-6. Sale by Governor;
certification of annual debt service amount.
The Governor shall sell the
bonds herein authorized at a time or times as provided by resolutions enacted
by the Legislature. The Governor, in his or her discretion, may, by executive
message, request that a resolution be proposed for the issuance of bonds
pursuant to this article. The Governor shall determine the manner by which
bonds will be sold at an aggregate price equal to, above or below par value. On
or before June 1 in the fiscal year in which the first bonds are issued pursuant
to this article and June 1 of each fiscal year, the commissioner shall certify
to the Treasurer and Secretary of the Department of Revenue the principal and
interest requirement for the following fiscal year on any bonds issued pursuant
to this article.
§17-26A-7. Conflicts of
interest.
No part of the proceeds
from the sale of bonds under this article may inure to the benefit of or be
distributable to the officers or employees of the state except to pay
reasonable compensation for services rendered to the state. Any person
violating the provisions of this section is guilty of a misdemeanor and, upon
conviction thereof, shall be fined not more than $1,000, or confined in jail
not more than one year, or both fined and confined.
§17-26A-8. State road
bonds lawful investments.
All state road bonds issued
pursuant to this article shall be lawful investments for banking institutions,
societies for savings, building and loan associations, savings and loan
associations, deposit guarantee associations, trust companies, and insurance
companies, including domestic for life and domestic not for life insurance
companies.
§17-26A-9. Refunding
bonds.
Any state road general
obligation bonds which are outstanding may at any time be refunded by the
issuance of refunding bonds in an amount deemed necessary to refund the
principal of the bonds to be refunded, together with any unpaid interest
thereon; to accomplish the purpose of the amendment and to pay any premiums necessary
to be paid in connection therewith. Any refunding may be effected whether the
state road general obligation bonds to be refunded shall have then matured or
shall thereafter mature. Any refunding bonds issued pursuant to this article
shall be payable from the Roads to Prosperity Bond Debt Service Fund.
§17-26A-10. Termination
or dissolution.
Upon the termination or
dissolution of the West Virginia Division of Highways, all rights and
properties of the West Virginia Division of Highways with respect to the Roads
to Prosperity Bond Debt Service Fund shall pass to and be vested in the state,
subject to the rights of bondholders, lienholders and other creditors.
§17-26A-11. Treasurer to
determine financial advisor.
The Treasurer, in his or
her discretion, may select a competent person or firm to serve as financial
advisor for the issuance and sale of general obligation bonds issued pursuant
to this article.
§17-26A-12. Governor to
determine bond counsel.
The Governor shall select a
competent person or firm to serve as bond counsel who shall be responsible for
the issuance of a final approving opinion regarding the legality of the sale of
general obligation bonds issued pursuant to this article. Notwithstanding the
provisions of article three, chapter five of this code, bond counsel may
represent the state in court, render advice and provide other legal services as
may be requested by the Governor, the secretary or the commissioner regarding
any bond issuance pursuant to this article and all other matters relating to
the bond issue. The Governor may also, in his or her discretion, select a
person or firm to serve as underwriter for any issuance pursuant to this
article.
§17-26A-13. Approval of
and payment of all necessary expenses.
All necessary expenses,
including legal expenses, incurred in the issuance of any general obligation
bonds pursuant to this article shall be paid out of the Roads to Prosperity
Bond Debt Service Fund or the State Road Fund if so appropriated by the
Legislature. The amount of any expenses incurred shall be certified to the Treasurer
by the Commissioner of Highways.
§17-26A-14. Dedication
of taxes and fees.
(a) There shall be
dedicated an annual amount from the collections of the taxes and fees imposed
pursuant to chapters eleven, seventeen-a, seventeen-b, seventeen-c and
seventeen-d of this code, that are required to be deposited to the credit of
the State Road Fund sufficient to pay the principal and interest of any state
road bonds issued pursuant to this article.
(b) Beginning in July in
the fiscal year in which the first interest payment on the bonds issued
pursuant to this article is due, and monthly thereafter for the first ten
months of each fiscal year, there shall be deposited into the Roads to Prosperity
Bond Debt Service Fund an amount equal to one tenth of the projected annual
principal and interest requirements, as certified by the commissioner, on all
bonds issued pursuant to this article, of the tax collected pursuant to chapter
eleven of this code: Provided, That
each tenth payment shall be reduced by any interest earnings accrued to the
Roads to Prosperity Bond Debt Service Fund: Provided,
however, That if bonds issued after the annual certification have a first
interest or principal payment coming due in the then current or next fiscal
year, the monthly deposits shall be made in such a manner to provide for the
payment of the interest and/or principal coming due.