Senate Bill No. 692
(By Senators Tomblin (Mr. President) and Chafin)
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[Introduced March 26, 2001; referred to the Committee on
Finance.]
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A BILL to amend and reenact section twenty-one, article two-c,
chapter thirteen of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to an increase
in the allocation of the state ceiling for private activity
bonds to the West Virginia housing development fund.
Be it enacted by the Legislature of West Virginia:
That section twenty-one, article two-c, chapter thirteen of
the code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 2C. INDUSTRIAL DEVELOPMENT AND COMMERCIAL DEVELOPMENT
BOND ACT.
§13-2C-21. Ceiling on issuance of private activity bonds;
establishing procedure for allocation and disbursements; reservation of funds; limitations;
unused allocation; expirations and carryovers.
(a) Private activity bonds (as defined in Section 141(a) of
the United States Internal Revenue Code of 1986, other than those
described in Section 146(g) of the Internal Revenue Code) issued
pursuant to this article, including bonds issued by the West
Virginia public energy authority pursuant to subsection (11),
section five, article one, chapter five-d of this code, or under
article eighteen, chapter thirty-one of this code, during any
calendar year shall may not exceed the ceiling established by
Section 146(d) of the United States Internal Revenue Code. It is
hereby determined and declared as a matter of legislative finding:
(i) That, in an attempt to promote economic revitalization of
distressed urban and rural areas, certain special tax incentives
will be provided for empowerment zones and enterprise communities
to be designated from qualifying areas nominated by state and local
governments, all as set forth by Section 1391 et seq. of the United
States Internal Revenue Code; (ii) that qualified businesses
operating in enterprise communities and empowerment zones will be
eligible to finance property and provide other forms of financial
assistance as provided for in Section 1394 of the United States
Internal Revenue Code; (iii) that it is in the best interest of this state and the its citizens to facilitate the acquisition,
construction and equipping of projects within designated
empowerment zones and enterprise communities by providing an
orderly mechanism for the commitment of the annual ceiling for
private activity bonds for such these projects. It is hereby
further determined and declared as a matter of legislative finding;
(iv) that the production of bituminous coal in this state has
resulted in coal waste, which coal waste is stored in areas
generally referred to as gob piles; (v) that such gob piles are
unsightly and have the potential to pollute the environment in this
state; (vi) that the utilization of the materials in such gob piles
to produce alternative forms of energy needs to be encouraged;
(vii) that Section 142(a)(6) of the United States Internal Revenue
Code of 1986, permits the financing of solid waste disposal
facilities through the issuance of such private activity bonds; and
(viii) that it is in the best interest of this state and the its
citizens thereof to facilitate the construction of facilities for
the generation of power through the utilization of coal waste by
providing an orderly mechanism for the commitment of the annual
ceiling for private activity bonds for such these projects.
(b) On or before the first day of each calendar year, the executive director of the development office shall determine the
state ceiling for such the year based on the criteria of the United
States Internal Revenue Code, which annual ceiling shall be
allocated among the several issuers of bonds under this article or
under article eighteen, chapter thirty-one of this code, as
follows:
(1) Fifty million dollars For the calendar year two thousand
one, fifty million dollars, and for each subsequent calendar year,
forty percent of the state ceiling for that year shall be allocated
to the West Virginia housing development fund for the purpose of
issuing qualified mortgage bonds, qualified mortgage certificates
or bonds for qualified residential rental projects;
(2) The amount remaining after the allocation to the West
Virginia housing development fund described in subdivision (1) of
this subsection shall be is retained by the West Virginia
development office and shall be referred to in this section as the
"state allocation";
(3) For calendar year one thousand nine hundred ninety-five,
twenty-five and one-half percent of the state allocation and for
all subsequent calendar years, thirty-five Thirty-five percent of
the state allocation shall be is
set aside by the development office to be made available for lessees, purchasers or owners of
proposed projects, hereafter in this section referred to as
"nonexempt projects", which do not qualify as exempt facilities as
defined by United States Internal Revenue Code. All reservations
of private activity bonds for nonexempt projects shall be are
approved and awarded by the committee based upon an evaluation of
general economic benefit and any rule or regulation that the
council for community and economic development may promulgate
promulgates pursuant to section three, article two, chapter five-b
of this code: Provided, That all requests or reservations of funds
from projects described in this subsection shall be are
submitted
to the development office on or before the first day of November of
each calendar year: Provided, however, That on the fifteenth day
of November of each calendar year, the uncommitted portion of this
part of the state allocation, shall revert to and become part of
the state allocation portion described in subsection (g) of this
section; and
(4) For calendar year one thousand nine hundred ninety-five,
four and one-half percent of the state allocation and for all
subsequent calendar years, ten Ten percent of the state allocation
shall be is
made available for lessees, purchasers or owners of proposed commercial or industrial projects which qualify as exempt
facilities under Section 1394 of the United States Internal Revenue
Code. All reservations of private activity bonds for the projects
shall be approved and awarded by the committee based upon an
evaluation of general economic benefit and any rule or regulation
that the council for community and economic development may
promulgate promulgates pursuant to section three, article two,
chapter five-b of this code: Provided, That all requests for
reservations of funds from projects described in this subsection
shall be are
submitted to the development office on or before the
first day of November of each calendar year: Provided, however,
That on the fifteenth day of November of each calendar year, the
uncommitted portion of this part of the state allocation shall
revert to and become part of the state allocation portion described
in subsection (g) of this section.
(c) For calendar year one thousand nine hundred ninety-five,
the remaining seventy percent and for all subsequent calendar
years, The remaining fifty-five percent of the state allocation
shall be is
made available for lessees, purchasers or owners of
proposed commercial or industrial projects which qualify as exempt
facilities as defined by Section 142(a) of the United States Internal Revenue Code. All reservations of private activity bonds
for exempt facilities shall be are
approved and awarded by the
committee based upon an evaluation of general economic benefit and
any rule or regulation that the council for community and economic
development may promulgate promulgates pursuant to section three,
article two, chapter five-b of this code: Provided, That no
reservation shall may be in an amount in excess of fifty percent of
this portion of the state allocation: Provided, however, That all
requests for reservations of funds from projects described in this
subsection shall be are
submitted to the development office on or
before the first day of November of each calendar year: Provided
further, That on the fifteenth day of November of each calendar
year, the uncommitted portion of this part of the state allocation
shall revert to and become part of the state allocation portion
described in subsection (g) of this section.
(d) No reservation shall may be made for any project until the
governmental body seeing the same shall submit submits a notice of
reservation of funds as provided in subsection (e) of this section.
The governmental body must first adopt an inducement resolution
approving the prospective issuance of bonds and setting forth the
maximum amount of bonds to be issued. Each governmental body seeking a reservation of funds following the adoption of such the
inducement resolution shall submit a notice of inducement signed by
its clerk, secretary or recorder or other appropriate official to
the development office. Such The notice shall include information
as may be required by the development office pursuant to any rule
or regulation of the council for community and economic
development. Notwithstanding the foregoing, when a governmental
body proposes to issue bonds for the purpose of: (i) Constructing,
acquiring or equipping a project described in subdivision (3) or
(4), subsection (b) of this section; or (ii) constructing an energy
producing project which relies, in whole or in part, upon coal
waste as fuel, to the extent such the project qualifies as a solid
waste facility under Section 142(a)(6) of the United States
Internal Revenue Code of 1986, the project may be awarded a
reservation of funds from the state allocation available for three
years subsequent to the year in which the notice of reservation of
funds is submitted, at the discretion of the executive director of
the development office: Provided, That no discretionary reservation
may be made for any single project described in this subsection in
an amount in excess of thirty-five percent of the state allocation
available for the year subsequent to the year in which the request is made. A discretionary reservation of the state allocation for
a project described in this subsection shall may not be granted by
the executive director of the development office unless the project
for which the request is made has received a certification from the
federal energy regulatory commission as a qualifying facility or a
cogeneration project.
(e) Currently with or following the submission of its notice
of inducement, the governmental body at any time deemed considered
expedient by it may submit its notice of reservation of funds which
shall include the following information:
(1) The date of the notice of reservation of funds;
(2) The identity of the governmental body issuing the bonds;
(3) The date of inducement and the prospective date of
issuance;
(4) The name of the entity for which the bonds are to be
issued;
(5) The amount of the bond issue or, if the amount of the bond
issue for which a reservation of funds has been made has been
increased, the amount of the increase;
(6) The type of issue; and
(7) A description of the project for which the bonds are to be issued.
(f) The development office shall accept the notice of
reservation of funds no earlier than the first calendar workday of
the year for which a reservation of funds is sought: Provided,
That a notice of reservation of funds with respect to a project
described in subdivision (4), subsection (b) of this section or an
energy producing project that is eligible for a reservation of
funds for a year subsequent to the year in which the notice of
reservation of funds is submitted may contain an application for
funds from a subsequent year's state allocation. Upon receipt of
the notice of reservation of funds, the development office shall
immediately note upon the face of the notice the date and time of
reception.
(g) If the bond issue for which a reservation has been made
has not been finally closed within one hundred twenty days of the
date of the reservation to be made by the committee, or the
thirty-first of December following such date of reservation if
sooner and a statement of bond closure which has been executed by
the clerk, secretary, recorder or other appropriate official of the
governmental body reserving the same has not been received by the
development office within that time, then the reservation shall expire and be deemed considered to have been forfeited and the
funds so reserved shall be released and revert to the portion of
the state allocation from which the funds were originally reserved
and shall them then be made available for other qualified issues in
accordance with this section and the Internal Revenue Code:
Provided, That as to any reservation for a nonexempt project or any
reservation for a project described in subdivision (4), subsection
(b) of this section that is forfeited on or after the first day of
November in any calendar year, such the reservation shall revert to
the state allocation for allocation by the industrial revenue bond
allocation review committee: Provided, however, That as to any
notice of reservation of funds received by the development office
during the month of December in any calendar year with respect to
any project qualifying as an elective carry forward pursuant to
Section 146(f)(5) of the Internal Revenue Code, the notice of
reservation of funds and the reservation to which the same relates
shall may not expire or be subject to forfeiture: Provided
further, That any unused state ceiling as of the thirty-first day
of December in any year not otherwise subject to a carry forward
pursuant to Section 146(f) of the Internal Revenue Code shall be is
allocated to the West Virginia housing development fund, which shall be deemed considered to have elected to carry forward the
unused state ceiling for the purpose of issuing qualified mortgage
bonds, qualified mortgage credit certificates or bonds for
qualified residential rental projects, each as defined in the
Internal Revenue Code. All requests for subsequent reservation of
funds upon loss of a reservation pursuant to this section shall be
are
treated in the same manner as a new notice of reservation of
funds in accordance with subsections (d) and (e) of this section.
(h) Once a reservation of funds has been made for a project
described in subdivision (4), subsection (b) of this section or for
an energy producing project which relies, in whole or in part, upon
coal waste as fuel and otherwise qualifies as a solid waste
facility under Section 142(a)(6) of the United States Internal
Revenue Code of 1986, notwithstanding the language of subsection
(g) of this section, the reservation shall remain fully available
with respect to such the project until the first day of October in
the year from which the reservation was made at which time, if the
bond issue has not been finally closed, the reservation shall
expire and be deemed considered forfeited and the funds so reserved
shall be are
released as provided in subsection (g) of this
section.
NOTE: The purpose of this bill is to increase the portion of
the state private activity bond ceiling allocated to the West
Virginia Housing Development Fund from $50 million to forty percent
of the state ceiling beginning with calendar year 2001.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.