House Bill No. 188

Introduced By _______________________________________________________________________________



A Bill for an Act entitled: "An Act authorizing the creation of state debt through the issuance of general obligation bonds; appropriating the proceeds of the bonds for information technology projects for the biennium ending June 30, 1999; providing for debt service payments from the general fund and other sources; providing for matters relating to the issuance of the bonds and the appropriation of the bond proceeds; and providing an immediate effective date."



Be it enacted by the Legislature of the State of Montana:



NEW SECTION. Section 1.  Definitions. As used in [sections 1 through 8], the following definitions apply:

(1) "Cost allocation plans" means the:

(a) state cost allocation plan by which state general fund costs are distributed in an equitable manner to nonfederal funding sources other than the general fund; and

(b) statewide cost allocation plan by which state general fund costs are allocated to federally funded, state-operated grants and programs.

(2) "Information technology project" means the planning, design, development, acquisition, installation, or integration of software and required hardware to provide for upgraded and integrated state management information systems.

(3) "Other funding sources" means money other than bond proceeds.

(4) "Responsible agency" means the lead agency for each information technology project as provided in [section 2].



NEW SECTION. Section 2.  Appropriation of bond proceeds and approval of information technology information projects. Upon the sale of general obligation bonds by the board of examiners, the following bond proceeds are appropriated from the capital projects fund to each responsible agency for the following information technology projects:

Agency/Project Bond Proceeds

DEPARTMENT OF REVENUE

Integrated Revenue and Tax Systems $17,750,000

(Consolidation of Employer's Reporting

for Income Tax Withholding, Old Fund

Liability Tax, and Unemployment Insurance

Contributions; Income Tax Modernization; and

Property Tax Integration)

DEPARTMENT OF ADMINISTRATION

Montana Project to Reengineer Revenue

and the Information Management

Environment (MT PRRIME) 22,200,000

Cadastral Property Parcel Mapping 4,000,000

OFFICE OF BUDGET AND PROGRAM PLANNING

Montana Integrated Budget System (MIBS) 500,000

DEPARTMENT OF LABOR

Unemployment Benefit Package 3,600,000

MONTANA UNIVERSITY SYSTEM

Technology Initiative 7,000,000



NEW SECTION. Section 3.  Authorization of bonds. (1) The board of examiners may issue and sell general obligation information technology bonds in an amount not exceeding $55,050,000 for the projects described in [section 2] over and above the amount of general obligation bonds outstanding on January 1, 1997. The bonds must be issued in accordance with Title 17, chapter 5, part 8. The bonds authorized by this section must mature within 10 years from their date of issue. The authority granted to the board by this section is in addition to any other authorization to the board to issue and sell general obligation bonds.

(2) It is the intent of the 55th legislature that the annual debt service payments on the bonds authorized in subsection (1) be paid from the general fund and other funding sources in the respective principal amounts indicated in [sections 6 and 7].



NEW SECTION. Section 4.  Planning and design. The department of administration and the responsible agency may proceed with the planning and design of information technology projects before the receipt of bond proceeds. The department may use interaccount loans pursuant to 17-2-107 to pay planning and design costs incurred before receipt of the proceeds.



NEW SECTION. Section 5.  Financial plans to be approved. If the debt service costs of an information technology project are financed in whole or in part from a source other than the general fund, the responsible agency may not proceed with planning and design and the board of examiners may not issue the bonds until the responsible agency has submitted a financial plan that has been approved by the director of the department of administration assuring the availability of funding.



NEW SECTION. Section 6.  Allocation of selected debt service costs. (1) The department of administration shall allocate $12,600,000 of bond principal and the interest due on the bonds, for the MT PRRIME project to:

(a) appropriate funding sources using cost allocation plans; and

(b) appropriate proprietary programs for inclusion in their rates.

(2) The department of administration and the office of budget and program planning shall present to the 55th legislature increases in fiscal year 1999 budget authority in all nongeneral fund categories for the cost allocation plans to be included in the general appropriations act of 1997 based on the approved information technology projects.

(3) The proprietary programs identified pursuant to subsection (1)(b) shall transfer on a semi-annual basis, to the debt service fund administered by the department of administration, the amounts required to pay the debt service costs of the MT PRRIME project that are allocated to their programs.



NEW SECTION. Section 7.  Agreements for other funding sources. (1) In order to ensure payment from sources other than the general fund of certain of the general obligation bonds authorized for information technology projects under [section 3], the board of examiners shall enter into agreements with the department of revenue, the department of labor and industry, and the Montana university system. The agreements must provide that:

(a) income from the sale of the respective principal amount of bonds must be credited to the entity's repayment obligation;

(b) payment must be made from available funds; and

(c) the respective entity shall pay to the state treasurer for deposit, in accordance with 17-2-101 through 17-2-107, an amount sufficient to pay the following principal amount of bonds and interest due on the bonds:

(i) $1,250,000 from the department of revenue for revenue and integrated tax systems;

(ii) $3,600,000 from the department of labor and industry for the unemployment insurance benefit package; and

(iii) $3,500,000 from the Montana university system.

(2) In order to ensure payment of $600,000 in principal amount of bonds and interest due on the bonds for the cadastral property parcel mapping project, the board of examiners shall enter into agreements with participating state agencies and local governments. Payment under the agreements must be made from available funds.

(3) In order to ensure payment of $3 million in principal amount of bonds and interest due on the bonds for the cadastral property mapping project, the board of examiners shall enter into agreements with participating federal agencies and private parties.

(4) The agreements made pursuant to this section are solely for the benefit of the state of Montana and are not enforceable by bondholders or other third party beneficiaries.



NEW SECTION. Section 8.  Expenditures. Expenditures of bond proceeds under [sections 1 through 8] may be used for information technology project administration and implementation, including software and required hardware, software licensing, and contracted services.



NEW SECTION. Section 9.  Two-thirds vote required. Because [section 3] authorizes the creation of state debt, Article VIII, section 8, of the Montana constitution requires a vote of two-thirds of the members of each house of the legislature for passage.



NEW SECTION. Section 10.  Severability. If a part of [this act] is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.



NEW SECTION. Section 11.  Effective date. [This act] is effective on passage and approval.

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