Loading chat...
IN SB0608
Bill
AI Summary
-
State and local government entities must disclose any pledges, covenants, or agreements made as security or guarantor for private company bond issues in their financial statement notes and audit examinations
-
Political subdivisions must prepare a debt capacity analysis report and present it at a public hearing before issuing or guaranteeing any debt obligation, effective July 1, 2019
-
The State Board of Accounts, with assistance from the Department of Local Government Finance, must prescribe a standard debt capacity analysis form by July 1, 2019
-
Required disclosures must include: description of conduit debt transactions, aggregate outstanding debt obligations, indication of issuer obligations beyond related leases/loans, and explanation of obligations in case of default
-
Debt capacity reports must show total current debt, additional proposed debt, percentage of total debt compared to prospective revenue available for debt service, and applicable statutory or constitutional debt limitations
Legislative Description
State and local audit examinations. Provides that the uniform compliance guidelines for audit examinations of state and local units conducted by the state board of accounts must include a requirement that the unit disclose any pledge, covenant, or agreement that the unit has made as security or guarantor for a private bond issue of a private company. Requires any entity that: (1) is subject to examination or audit by the state board of accounts; and (2) has made a pledge, covenant, or agreement as security or guarantor for a private bond issue of a private company; to disclose such fact in the notes of the entity's financial statements. Provides that, before a political subdivision that is subject to audit by the state board of accounts may issue or guarantee any debt obligation, the fiscal officer of the political subdivision must first prepare a debt capacity analysis report (report) and present the report to the fiscal body of the political subdivision in a public hearing. Requires the state board of accounts, with the assistance of the department of local government finance, to prescribe a standard form report that must be used by a fiscal officer in the presentation. Requires the report to include a determination of the percentage of the political subdivision's total debt obligations (including guarantees) compared to the political subdivision's prospective revenue available for debt service.
Last Action
First reading: referred to Committee on Government and Regulatory Reform
3/7/2019