Senate Bill No. 2012
(By Senators Tomblin, Mr. President, and Sprouse,
By Request of the Executive)
____________
[Introduced June 11, 2003; referred to the Committee on Finance.]
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A BILL to amend chapter five-a of the code of West Virginia, one
thousand nine hundred thirty-one, as amended, by adding
thereto a new article, designated article three-b; to amend
and reenact section three-hh, article one, chapter seven of
said code; to amend and reenact section eighteen, article
twelve, chapter eight of said code; and to amend article one,
chapter thirty-one of said code by adding thereto a new
section, designated section one hundred sixty-one, all
relating to authorizing agencies, county commissions, county
building commissions and county development authorities to
enter into performance-based contracts with qualified
providers of energy conservation measures for the purpose of
reducing energy operating costs of agency buildings;
authorizing counties and their instrumentalities to enter into
sale leaseback arrangements; exemptions available to private entity who is a party to the leaseback; leasebacks to be
considered public improvements; personal liability of a
private entity who is a party to a leaseback; specifying
county commission and county building commission interest in
real property; municipality, municipal building commission and
municipal development authority interest in real property;
interest in real property of organizations that are
organizations under Section 501(c)(3) of the United States
Internal Revenue Code; and tax exemption of Section 501(c)(3)
organizations not affected by leasebacks.
Be it enacted by the Legislature of West Virginia:
That chapter five-a of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, be amended by adding thereto
a new article, designated article three-b; that section three-hh,
article one, chapter seven of said code be amended and reenacted;
that section eighteen, article twelve, chapter eight of said code
be amended and reenacted; and that article one, chapter thirty-one
of said code be amended by adding thereto a new section, designated
section one hundred sixty-one, all to read as follows:
CHAPTER 5A. DEPARTMENT OF ADMINISTRATION.
ARTICLE 3B. ENERGY-SAVINGS CONTRACTS.
§5A-3B-1. Definitions.
As used in this article:
(a) "Agency" means all state departments, agencies,
authorities and all political subdivisions, including cities,
counties and boards of education.
(b) "Energy-conservation measures" means goods or services, or
both, to reduce energy consumption operating costs of agency
facilities. They include, but are not limited to, installation of
one or more of the following:
(1) Insulation of a building structure and systems within a
building;
(2) Storm windows or doors, caulking or weather stripping,
multiglazed windows or doors, heat-absorbing or heat-reflective
glazed and coated window or door systems, or other window or door
modifications that reduce energy consumption;
(3) Automatic energy control systems;
(4) Heating, ventilating or air conditioning systems,
including modifications or replacements;
(5) Replacement or modification of lighting fixtures to
increase energy efficiency;
(6) Energy recovery systems;
(7) Cogeneration systems that produce steam or another form of
energy for use by any agency in a building or complex of buildings
owned by the agency; or
(8) Energy-conservation maintenance measures that provide long-term operating cost reductions of the building's present cost
of operation.
(c) "Energy-savings contract" means a contract for the
evaluation and recommendation of energy operations conservation
measures, and for implementation of one or more measures. The
contract must provide that payments, except obligations upon
termination of the contract before its expiration, are to be made
over time. Any agency may supplement these payments with federal,
state or local funds to reduce the annual cost or to lower the
initial amount to be financed.
(d) "Qualified provider" means a person, firm or corporation
experienced in the design, implementation and installation of
energy-conservation measures.
§5A-3B-2. Contracts for energy-savings contracts.
(a) Agencies are authorized to enter into performance-based
contracts with qualified providers of energy-conservation measures
for the purpose of reducing energy operating costs of agency
buildings.
(b) Agencies may enter into an energy-savings contract with
a qualified provider to reduce energy operating costs
significantly. Before entering into a contract or before the
installation of equipment, modifications or remodeling to be
furnished under a contract, the qualified provider shall first issue a proposal summarizing the scope of work to be performed.
A proposal must contain estimates of all costs of installation,
modifications or remodeling, including the costs of design,
engineering, installation, maintenance, repairs or debt service,
as well as estimates of the amounts by which energy operating costs
will be reduced. If the agency finds, after receiving the
proposal, that the proposal includes one or more
energy-conservation measure designed to save energy operating
costs, the agency may enter into a contract with the provider
pursuant to this section.
(c) An energy-savings contract must include the following:
(1) A guarantee of a specific minimum amount of money that the
agency will save in energy operating costs each year during the
term of the contract;
(2) A statement of all costs of energy-conservation measures,
including the costs of design, engineering, installation,
maintenance, repairs and operations.
(d) An energy-savings contract which is performance-based and
includes a guarantee of savings and a comprehensive approach of
energy-conservation measures for improving comfort is subject to
competitive bidding requirements: Provided, That the requirements
of article five-a, chapter twenty-one of this code as to prevailing
wage rates shall apply to the construction and installation work performed under a contract.
(e) Agencies may enter into a "lease with an option to
purchase" contract for the purchase and installation of energy-
conservation measures if the term of the lease does not exceed
fifteen years, and the lease contract includes the provisions
contained in subsection (f), and meets federal tax requirements for
tax-exempt municipal leasing or long-term financing.
(f) An energy-savings contract may extend beyond the fiscal
year in which it first becomes effective: Provided, That such a
contract may not exceed a fifteen-year term: Provided, however,
That such long term contract will be void unless such agreement
provides that the agency shall have the option during each fiscal
year of the contract to terminate the agreement. The agency may
include in its annual budget for each fiscal year any amounts
payable under long-term energy-savings contracts during that fiscal
year.
CHAPTER 7. COUNTY COMMISSIONS AND OFFICERS.
ARTICLE 1. COUNTY COMMISSIONS GENERALLY.
§7-1-3hh. Authority to lease, sell or dispose of county property
to the state, federal government or an
instrumentality thereof.
(a) Every county commission, building commission created
pursuant to article thirty-three, chapter eight of this code and development authority created pursuant to article twelve of this
chapter is authorized to sell, lease as lessor or dispose of any
of its real or personal property or any interest therein or any
part thereof, as authorized in article five, chapter one of this
code, or to the United States of America or any agency or
instrumentality thereof, or to the state or any agency or
instrumentality thereof, for a public purpose for an adequate
consideration, without considering alone the commercial or market
value of such property.
(b)Every county commission, building commission created
pursuant to article thirty-three, chapter eight of this code and
development authority created pursuant to article twelve of this
chapter is further authorized to enter into sale-leaseback or like-
kind exchange agreements with public or private parties. Real and
personal property taxation exemptions, exemptions relating to
transfers of real property, exemptions from the payment of business
and occupation, franchise and licensing taxes and exemptions from
taxation relating to operations or facilities owned, leased or
exchanged by a county commission, a county building commission or
a county development authority that are set forth elsewhere in this
code and available thereto shall not be affected by any transaction
in which, for the purpose of obtaining financing, a county
commission, a county building commission or a county development authority, directly or indirectly, leases or otherwise transfers
the property to a private entity whose property would not otherwise
be exempt and immediately thereafter enters into a leaseback or
other agreement that, directly or indirectly, gives a county
commission, a county building commission or a county development
authority the right to use, control and possess the property.
Notwithstanding anything in this code to the contrary, the
exemptions from taxation described in this subsection available to
a county commission, a county building commission or a county
development authority shall also be available to any private entity
that is a party to a leaseback, exchange or other agreement that,
directly or indirectly, gives a county commission, a county
building commission or a county development authority the right to
use, control and possess the property. Any real or personal
property that is acquired for the benefit of a county commission,
a county building commission or a county development authority as
provided in this section shall at the time be considered a public
improvement and shall be insured against hazards and other
liabilities as are similar properties and public improvements. Any
private entity that is a party to a leaseback, exchange or other
agreement that, directly or indirectly, gives a county commission,
a county building commission or a county development authority the
right to use, control and possess the property is exempt from any personal liability relating to the use, control or possession of
the property.
(c) A county commission, a county building commission or a
county development authority are each authorized to enter into
performance-based contracts with qualified providers of
energy-conservation measures for the purpose of reducing energy
operating costs of buildings.
(d) Such agencies may enter into an energy-savings contract
with a qualified provider to reduce energy operating costs
significantly. Before entering into a contract or before the
installation of equipment, modifications or remodeling to be
furnished under a contract, the qualified provider shall first
issue a proposal summarizing the scope of work to be performed.
A proposal must contain estimates of all costs of installation,
modifications or remodeling, including the costs of design,
engineering, installation, maintenance, repairs or debt service,
as well as estimates of the amounts by which energy operating costs
will be reduced. If the agency finds, after receiving the
proposal, that the proposal includes one or more
energy-conservation measure designed to save energy operating
costs, the agency may enter into a contract with the provider
pursuant to this section.
(e) An energy-savings contract must include the following:
(1) A guarantee of a specific minimum amount of money that the
agency will save in energy operating costs each year during the
term of the contract;
(2) A statement of all costs of energy-conservation measures,
including the costs of design, engineering, installation,
maintenance, repairs and operations.
(f) An energy-savings contract which is performance-based and
includes a guarantee of savings and a comprehensive approach of
energy-conservation measures for improving comfort is subject to
competitive bidding requirements: Provided, That the requirements
of article five-a, chapter twenty-one of this code as to prevailing
wage rates shall apply to the construction and installation work
performed under a contract.
(g) Agencies may enter into a "lease with an option to
purchase" contract for the purchase and installation of energy-
conservation measures if the term of the lease does not exceed
fifteen years, and the lease contract includes the provisions
contained in subsection (h), and meets federal tax requirements for
tax-exempt municipal leasing or long-term financing.
(h) An energy-savings contract may extend beyond the fiscal
year in which it first becomes effective: Provided, That such a
contract may not exceed a fifteen-year term: Provided, however,
That such long term contract will be void unless such agreement provides that the agency shall have the option during each fiscal
year of the contract to terminate the agreement. The agency may
include in its annual budget for each fiscal year any amounts
payable under long-term energy-savings contracts during that fiscal
year.
(i) For purposes of this section, the following terms shall
have the definitions set forth below:
(a) "Energy-conservation measures" means goods or services, or
both, to reduce energy consumption operating costs of agency
facilities. They include, but are not limited to, installation of
one or more of the following:
(1) Insulation of a building structure and systems within a
building;
(2) Storm windows or doors, caulking or weather stripping,
multiglazed windows or doors, heat-absorbing or heat-reflective
glazed and coated window or door systems, or other window or door
modifications that reduce energy consumption;
(3) Automatic energy control systems;
(4) Heating, ventilating or air conditioning systems,
including modifications or replacements;
(5) Replacement or modification of lighting fixtures to
increase energy efficiency;
(6) Energy recovery systems;
(7) Cogeneration systems that produce steam or another form of
energy for use by any agency in a building or complex of buildings
owned by the agency; or
(8) Energy-conservation maintenance measures that provide
long-term operating cost reductions of the building's present cost
of operation.
(b) "Energy-savings contract" means a contract for the
evaluation and recommendation of energy operations conservation
measures, and for implementation of one or more measures. The
contract must provide that payments, except obligations upon
termination of the contract before its expiration, are to be made
over time. Any agency may supplement these payments with federal,
state or local funds to reduce the annual cost or to lower the
initial amount to be financed.
(c) "Qualified provider" means a person, firm or corporation
experienced in the design, implementation and installation of
energy-conservation measures.
CHAPTER 8. MUNICIPAL CORPORATIONS.
ARTICLE 12. GENERAL AND SPECIFIC POWERS, DUTIES AND ALLIED
RELATIONS OF MUNICIPALITIES, GOVERNING BODIES AND
MUNICIPAL OFFICERS AND EMPLOYEES; SUITS AGAINST
MUNICIPALITIES.
§8-12-18. Sale, lease or disposition of other municipal property.
(a) Every municipality, municipal building commission created
pursuant to article thirty-three of this chapter and municipal
development authority created pursuant to article twelve, chapter
seven of this code is authorized to sell, lease as lessor or dispose
of any of its real or personal property or any interest therein or
any part thereof (other than a public utility which shall be sold or
leased in accordance with the provisions of section seventeen of this
article), as authorized in article five, chapter one of this code,
or to the United States of America or any agency or instrumentality
thereof, or to the state or any agency or instrumentality thereof,
for a public purpose for an adequate consideration, without
considering alone the present commercial or market value of such
property.
(b) In all other cases involving a sale, any municipality is
hereby empowered and authorized to sell any of its real or personal
property or any interest therein or any part thereof for a fair and
adequate consideration, the property to be sold at public auction at
a place designated by the governing body, but before making any sale,
notice of the time, terms and place of sale, together with a brief
description of the property to be sold, shall be published as a Class
II legal advertisement in compliance with the provisions of article
three, chapter fifty-nine of this code and the publication area for
the publication shall be the municipality. The requirements of notice and public auction shall not apply to the sale of any one item or
piece of property of less value than one thousand dollars and under
no circumstances shall the provisions of this section be construed as
being applicable to any transaction involving the trading in of
municipally owned property on the purchase of new or other property
for the municipality and every municipality shall have plenary power
and authority to enter into and consummate any trade-in transaction.
(c) In all other cases involving a lease, any municipality is
hereby empowered and authorized to lease as lessor any of its real or
personal property or any interest therein or any part thereof for a
fair and adequate consideration and for a term not exceeding fifty
years. Every lease shall be authorized by resolution of the governing
body of the municipality, which resolution may specify terms and
conditions which must be contained in such lease: Provided, That
before any proposed lease is authorized by resolution of the governing
body, a public hearing on the proposed lease shall be held by the
governing body after notice of the date, time, place and purpose of
the public hearing has been published as a Class I legal advertisement
in compliance with the provisions of article three, chapter fifty-nine
of this code and the publication area for the publication shall be the
municipality. The power and authority granted in this subsection
shall be in addition to, and not in derogation of, any power and
authority vested in any municipality under any constitutional or other statutory provision now or hereafter in effect.
(d) Notwithstanding anything in this section to the contrary,
every municipality, municipal building commission created pursuant
to article thirty-three, chapter eight of this code and
development authority created pursuant to article twelve of this
chapter is further authorized to enter into sale-leaseback or like-
kind exchange agreements with public or private parties. Real and
personal property taxation exemptions, exemptions relating to
transfers of real property, exemptions from the payment of business
and occupation, franchise and licensing taxes and exemptions from
taxation relating to operations or facilities owned, leased or
exchanged by a municipality, a municipal building commission or a
municipal development authority that are set forth elsewhere in
this code and available thereto shall not be affected by any
transaction in which, for the purpose of obtaining financing, a
municipality, a municipal building commission or a municipal
development authority, directly or indirectly, leases or otherwise
transfers the property to a private entity whose property would not
otherwise be exempt and immediately thereafter enters into a
leaseback or other agreement that, directly or indirectly, gives
a municipality, a municipal building commission or a municipal
development authority the right to use, control and possess the
property. Notwithstanding anything in this code to the contrary, the exemptions from taxation described in this subsection available
to a municipality, a municipal building commission or a municipal
development authority shall also be available to any private entity
that is a party to a leaseback, exchange or other agreement that,
directly or indirectly, gives a municipality, a municipal building
commission or a municipal development authority the right to use,
control and possess the property. Any real or personal property
that is acquired for the benefit of a municipality, a municipal
building commission or a municipal development authority as
provided in this section shall at the time be considered a public
improvement and shall be insured against hazards and other
liabilities as are similar properties and public improvements. Any
private entity that is a party to a leaseback, exchange or other
agreement that, directly or indirectly, gives a municipality, a
municipal building commission or a municipal development authority
the right to use, control and possess the property is exempt from
any personal liability relating to the use, control or possession
of the property.
(e) A municipality, a municipal building commission or a
municipal development authority are each authorized to enter into
performance-based contracts with qualified providers of
energy-conservation measures for the purpose of reducing energy
operating costs of buildings.
(f) Such agencies may enter into an energy-savings contract
with a qualified provider to reduce energy operating costs
significantly. Before entering into a contract or before the
installation of equipment, modifications or remodeling to be
furnished under a contract, the qualified provider shall first
issue a proposal summarizing the scope of work to be performed.
A proposal must contain estimates of all costs of installation,
modifications or remodeling, including the costs of design,
engineering, installation, maintenance, repairs or debt service,
as well as estimates of the amounts by which energy operating costs
will be reduced. If the agency finds, after receiving the
proposal, that the proposal includes one or more
energy-conservation measure designed to save energy operating
costs, the agency may enter into a contract with the provider
pursuant to this section.
(g) An energy-savings contract must include the following:
(1) A guarantee of a specific minimum amount of money that the
agency will save in energy operating costs each year during the
term of the contract;
(2) A statement of all costs of energy-conservation measures,
including the costs of design, engineering, installation,
maintenance, repairs and operations.
(h) An energy-savings contract which is performance-based and includes a guarantee of savings and a comprehensive approach of
energy-conservation measures for improving comfort is subject to
competitive bidding requirements: Provided, That the requirements
of article five-a, chapter twenty-one of this code as to prevailing
wage rates shall apply to the construction and installation work
performed under a contract.
(i) Agencies may enter into a "lease with an option to
purchase" contract for the purchase and installation of energy-
conservation measures if the term of the lease does not exceed
fifteen years, and the lease contract includes the provisions
contained in subsection (h), and meets federal tax requirements for
tax-exempt municipal leasing or long-term financing.
(j) An energy-savings contract may extend beyond the fiscal
year in which it first becomes effective: Provided, That such a
contract may not exceed a fifteen-year term: Provided, however,
That such long term contract will be void unless such agreement
provides that the agency shall have the option during each fiscal
year of the contract to terminate the agreement. The agency may
include in its annual budget for each fiscal year any amounts
payable under long-term energy-savings contracts during that fiscal
year.
(k) For purposes of this section, the following terms shall
have the definitions set forth below:
(a) "Energy-conservation measures" means goods or services, or
both, to reduce energy consumption operating costs of agency
facilities. They include, but are not limited to, installation of
one or more of the following:
(1) Insulation of a building structure and systems within a
building;
(2) Storm windows or doors, caulking or weather stripping,
multiglazed windows or doors, heat-absorbing or heat-reflective
glazed and coated window or door systems, or other window or door
modifications that reduce energy consumption;
(3) Automatic energy control systems;
(4) Heating, ventilating or air conditioning systems,
including modifications or replacements;
(5) Replacement or modification of lighting fixtures to
increase energy efficiency;
(6) Energy recovery systems;
(7) Cogeneration systems that produce steam or another form of
energy for use by any agency in a building or complex of buildings
owned by the agency; or
(8) Energy-conservation maintenance measures that provide
long-term operating cost reductions of the building's present cost
of operation.
(b) "Energy-savings contract" means a contract for the evaluation and recommendation of energy operations conservation
measures, and for implementation of one or more measures. The
contract must provide that payments, except obligations upon
termination of the contract before its expiration, are to be made
over time. Any agency may supplement these payments with federal,
state or local funds to reduce the annual cost or to lower the
initial amount to be financed.
(c) "Qualified provider" means a person, firm or corporation
experienced in the design, implementation and installation of
energy-conservation measures.
CHAPTER 31. CORPORATIONS.
ARTICLE 1. BUSINESS AND NONPROFIT CORPORATIONS.
§31-1-161. Sale, lease or disposition of real property.
(a) In addition to any other powers enumerated in this article,
any organization that is an organization under section 501(c)(3) of
the United States Internal Revenue Code is authorized to enter into
sale-leaseback or like-kind exchange agreements with public or
private parties. Real and personal property taxation exemptions,
exemptions relating to transfers of real property, exemptions from
the payment of business and occupation, franchise and licensing
taxes and exemptions from taxation relating to operations or
facilities owned, leased or exchanged by an organization that is
an organization under section 501(c)(3) of the United States Internal Revenue Code that are set forth elsewhere in this code and
available thereto shall not be affected by any transaction in
which, for the purpose of obtaining financing, such organization,
directly or indirectly, leases or otherwise transfers the property
to a private entity whose property would not otherwise be exempt
and immediately thereafter enters into a leaseback or other
agreement that, directly or indirectly, gives such organization
authority the right to use, control and possess the property.
Notwithstanding anything in this code to the contrary, the
exemptions from taxation described in this subsection available to
an organization that is an organization under section 501(c)(3) of
the United States Internal Revenue Code shall also be available to
any private entity that is a party to a leaseback, exchange or
other agreement that, directly or indirectly, gives such
organization the right to use, control and possess the property.
Any real or personal property that is acquired for the benefit of
an organization under section 501(c)(3) of the United States
Internal Revenue Code as provided in this section shall at the time
be considered a public improvement and shall be insured against
hazards and other liabilities as are similar properties and public
improvements. Any private entity that is a party to a leaseback,
exchange or other agreement that, directly or indirectly, gives an
organization under section 501(c)(3) of the United States Internal Revenue Code the right to use, control and possess the property is
exempt from any personal liability relating to the use, control or
possession of the property.
NOTE: Creates process and procedure allowing agencies,
counties, and their instrumentalities to enter into
performance-based contracts with qualified providers of energy
conservation measures. Additionally, provides for nonprofit
corporations, counties, and their instrumentalities to enter into
sale leaseback arrangements with public or public parties.
Article 3B of Chapter 5-A and § 31-1-161 are new; therefore,
strike-throughs and underscoring have been omitted.
Elsewhere, strike-throughs indicate language to be stricken
from present law and underscoring indicates new language to be
added.