Senate Bill No. 1003
(By Senators Tomblin, Mr. President, and Buckalew,
By Request of the Executive)
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[Introduced April 20, 1997; referred to the
Committee on Finance.]
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A BILL to amend and reenact section nineteen, article six, chapter twelve of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to increasing the amount of borrowing authorized from the consolidated fund by the state building commission for construction of regional jails and correctional facilities; clarifying procedures for the loans; and setting priorities for use of the loan proceeds.

Be it enacted by the Legislature of West Virginia:
That section nineteen, article six, chapter twelve of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted to read as follows:
ARTICLE 6. WEST VIRGINIA STATE INVESTMENT MANAGEMENT BOARD.

§12-6-19. Authorization for loans by the board.

(a) The board, upon request of the state building commission, shall transfer moneys as a loan to the state building commission in an amount not to exceed in the aggregate twenty-one million dollars for the purposes of financing or refinancing the projects specified in subsections (b) and (d), section eight, article six, chapter five of this code. The money borrowed shall bear interest during the term of the loan at a fixed rate not to exceed the interest rate on treasury notes, bills or bonds of the same term as the term of the loan the week of closing on the loan as reported by the treasury of the United States. Loans made under this subsection shall be repaid in regular monthly or semiannual payments, or as funds are made available by the budget office of department of administration, and shall be paid in full not later than twenty-five years from the date the loans are made with terms and conditions mutually agreed upon by the state building commission and the investment management board.
(b) The state board of investments shall upon request of the state building commission transfer moneys as a loan to the state building commission in an amount not to exceed in the aggregate ~~eighty~~ one hundred thirty-seven million dollars for the purposes of financing construction of regional jails, correctional facilities, or building extensions or improvements to regional jails and correctional facilities. Prior to the expenditure of any loan proceeds, the regional jail and correctional facility authority shall certify a list of projects to the state building commission and the joint committee on government and finance that are to be funded from loan proceeds. This certified list cannot thereafter be altered or amended other than by legislative enactment. ~~Upon receipt of the certified list of projects, the state building commission shall transfer the loan proceeds to the regional jail and correctional facility authority.~~ The state building commission shall borrow money as needed by the regional jail and correctional facility authority. The investment management board shall transfer loan proceeds to the authority for expenditure. The money borrowed shall bear interest during the term of the loan at a fixed rate not to exceed the interest rate on treasury notes, bills or bonds of the same term as the term of the loan the week of closing on the loan as reported by the treasury of the United States.
(c) The regional jail and correctional facility authority shall use the loan proceeds received under the provisions of subsection (b) of this section to proceed with the projects on the certified list submitted to the joint committee on government and finance by letter dated the fifteenth day of January, one thousand nine hundred ninety-seven.
(d) Loans made under this section for the projects specified in subsection (b) of this section and in subsection (d), section eight, article six, chapter five of this code, shall be repaid in annual payments of not less than twelve million dollars per year by appropriation of the Legislature to the board. The amount transferred for loans under subsection (a) or (b) of this section shall not exceed that amount which the board determines is reasonable given the cash flow needs of the consolidated fund. The board shall make transfers for loans first for the project specified in subsection (d), section eight, article six, chapter five of this code, second for the projects specified in subsection (b) of this section and third for projects specified in subsection (b), section eight, article six, chapter five of this code, which are in imminent danger of default in payment. The board shall take the steps necessary to increase the liquidity of the consolidated fund over a period of the next five years to allow for the loans provided in this section without increasing the risk of loss in the consolidated fund.

Note: The purpose of this bill is to increase the amount of the borrowing authority from the consolidated fund by the state building commission for the construction of regional jails and correctional facilities from $80 to $137 million and to clarify certain procedures for the loans. Technical corrections are also made.