HOUSE BILL NO. 14

INTRODUCED BY R. JOHNSON

BY REQUEST OF THE GOVERNOR

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 CAPITAL PROJECTS FOR THE BIENNIUM ENDING JUNE 30, 2001; PROVIDING FOR MATTERS RELATING TO APPROPRIATIONS; AMENDING SECTION 17-7-211, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND A TERMINATION DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

NEW SECTION. Section 1. Definitions. For the purposes of [sections 1 through 8], unless otherwise stated, the following definitions apply:

(1) "Capital project" means the acquisition of land or improvements or the planning, capital construction, renovation, furnishing, or major repair projects authorized in [sections 1 through 8].

(2) "CPF" means the capital projects fund.

(3) "Other funding sources" means money other than CPF money, including special revenue fund money, that accrues to an agency under the provisions of the law.

NEW SECTION. Section 2. Appropriation of bond proceeds and other funds. (1) The following money is appropriated from the CPF and other funding sources to the department of administration for the capital projects described in this section, contingent upon the respective authorization of general obligation long-range building program bonds by the 56th legislature and the sale of the bonds by the board of examiners:

Agency/Project	CPF	Other Funding

Sources

DEPARTMENT OF ADMINISTRATION

Capitol Renovation	$3,898,750

DEPARTMENT OF CORRECTIONS

Expand Women's Prison, MWP, Billings	$2,900,000	$

Complete Pine Hills Youth Correctional Facility, Miles City	2,225,000

Security Improvements and Wallace Expansion, MSP, Deer Lodge	3,000,000

DEPARTMENT OF LABOR AND INDUSTRY

Havre Job Service Supplemental	210,000

DEPARTMENT OF MILITARY AFFAIRS

Montana National Guard, Veterans' Affairs and

Emergency Operations Center, Fort Harrison, Helena

3,500,000

Construct New Armory, Kalispell

1,800,000

Construct New Armory, Bozeman

2,200,000

MONTANA UNIVERSITIES AND COLLEGES

Renovate Renne Library, MSU-Bozeman	7,500,000

Rural Technology Education Center, UM-Dillon

4,170,000

Lab and Classroom Renovations, UM-All Campuses	2,000,000

(2) (a) The 56th legislature authorizes four department of corrections' capital construction projects in the 2001 biennium. Funding for the projects is contained in House Bill No. 5 and subsection (1) of this section. The total project cost and the authorized funding for each project are as follows:

(i) $9,375,000 for the women's prison expansion in Billings, funded by $2,900,000 of general obligation bond proceeds authorized in subsection (1) and by $6,475,000 of federal funds appropriated in House Bill No. 5;

(ii) $2,225,000 for completing the Pine Hills youth correctional facility in Miles City, funded from general obligation bond proceeds authorized in subsection (1); and

(iii) $3,000,000 for security improvements and expanding the Wallace building at Montana state prison in Deer Lodge, funded from general obligation bond proceeds authorized in subsection (1).

(b) The 56th legislature notes that approximately $8,714,600 of federal department of justice funds are anticipated to become available for capital construction projects for the department of corrections in the 2001 biennium. It is the intent of the 56th legislature that the federal funds be used in lieu of general obligation bond authority to the maximum extent possible. It is further the intent of the 56th legislature that the priority for using these federal funds is:

(i) up to $6,475,000 for the women's prison expansion project, line-itemed in House Bill No. 5;

(ii) up to $5,500,000 for the construction of the reception unit at Montana state prison, line-itemed in House Bill No. 5;

(iii) up to $2,225,000 for the completion of the Pine Hills youth correctional facility in Miles City, line-itemed in subsection (1); and

(iv) up to $3,000,000 for the security improvements and Wallace expansion project at Montana state prison, line-itemed in subsection (1).

(3) It is the intent of the 56th legislature that the security improvements and the Wallace expansion project line-itemed in subsection (1) be used only for the following projects:

(a) a 12,000-square foot expansion of the Wallace building to include a new board of pardons and parole hearing room, a new command post, a consolidated record storage area, a consolidated training area, and office space; and

(b) remodeling the existing business building to provide a centralized area for investigation, business and information services units, and a new safe and secure armory.

(4) The 56th legislature authorizes the construction of the rural technology education center at western Montana college of the university of Montana at a total project cost of $4,520,000. House Bill No. 5 contains $350,000 in other revenue authority for this project, and subsection (1) of this section contains $4,170,000 in general obligation bond authority for this project. In the event that other additional funds become available for this project during its construction, the general obligation bond authority in subsection (1)of this section must be reduced by a like amount and other revenue authority is increased by a like amount in House Bill No. 5 for the same purpose.

(5) All proceeds derived from the sale of the national guard armories located in Bozeman and Whitefish must be used to pay the general obligation debt service on the bonds issued for construction of the new Bozeman and Kalispell armories. The proceeds of the sale must be deposited in the general fund for this purpose. In the event one or both of the facilities are sold prior to issuance of the bonds, then the board of examiners may determine to use all or a portion of the amount deposited in the general fund to reduce the amount of the bond issue required to finance the construction.

NEW SECTION. Section 3. Authorization of bonds. (1) The board of examiners is authorized to issue and sell general obligation long-range building program bonds in an amount not exceeding $33,403,750 for the capital projects described in [section 2] over and above the amount of general obligation long-range building program bonds outstanding on January 1, 1999, to be issued in accordance with the terms and in the manner required by Title 17, chapter 5, part 8. 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 long-range building program bonds.

(2) It is the intent of the 56th legislature that debt service payments for the Havre job service office be paid with federal funds. If federal funds become unavailable, however, the department of labor and industry is directed to reduce operating or personal services costs in order to service the debt. The debt service payments for the job service office may not be paid with general fund money.

NEW SECTION. Section 4. Agreement with department of labor and industry. The board of examiners and the department of labor and industry may enter into an agreement for the expansion and renovation of the job service office, Havre, under which the department shall pay the state treasurer, for deposit in accordance with 17-2-101 through 17-2-107, an amount, as determined by the state treasurer, that is sufficient to pay the principal and interest due on the bonds and notes from which the appropriation was made and that is sufficient to accommodate and maintain reserves required under the bonds and notes. The agreement must further provide that income from the investment of bond proceeds, unused principal, and the reserves not required for construction and renovation costs may be credited against the department's payment obligation. The agreement must also allow for the accumulation of reserves during the first year that the bonds are outstanding. Payment by the department must be made from funds available therefor.

NEW SECTION. Section 5. Agreement with department of environmental quality. The department of environmental quality shall review capital projects authorized in [section 2] for potential inclusion in the state buildings energy conservation program. When review shows that a capital project will result in energy improvements, that capital project must be submitted to the energy conservation program for cofunding consideration. Cofunding provided under the energy conservation program guidelines must be used to offset or add to the authorized funding for the capital project, and the amount will be dependent on the annual utility savings resulting from the facility improvement. Agencies must be notified of potential cofunding after the review.

NEW SECTION. Section 6. Planning and design. The department of administration may proceed with the planning and design portions of capital projects before the receipt of other funding sources. The department may use interaccount loans in accordance with 17-2-107 to pay planning and design costs incurred before the receipt of other funding sources.

NEW SECTION. Section 7. Capital projects -- contingent funds. If a capital project is financed in whole or in part with appropriations contingent upon the receipt of other funding sources, the department of administration may not let the projects for bid until the agency has submitted a financial plan for approval by the director of the department. A financial plan may not be approved by the director if:

(1) the level of funding provided under the financial plan deviates substantially from the funding level provided in [section 2] for that project; or

(2) the scope of the capital project is substantially altered or revised from the preliminary plans presented for that capital project in the 2000-2001 long-range building program presented to the 56th legislature.

NEW SECTION. Section 8. Legislative consent. The appropriations authorized in [section 2] constitute legislative consent for the capital projects contained in [section 2] within the meaning of 18-2-102.

Section 9. Section 17-7-211, MCA, is amended to read:

"17-7-211. Expansion to be authorized -- budget amendment. (1) An existing capital project may not be expanded beyond the scope of the project approved by the legislature unless the expansion of the project is authorized by a long-range building program budget amendment approved by the budget director.

(2) A proposed long-range building program budget amendment must be submitted to the budget director through the architecture and engineering division of the department of administration. Except as provided in (3), the budget director, through a long-range building program budget amendment, may authorize:

(a) the transfer of excess funds appropriated to a capital project within an agency to increase the appropriation of another capital project within that agency; or

(b) financing to expand a project with funds that were not available for consideration by the legislature.

(3) Subsections (1) and (2) do not apply to capital construction projects authorized for the department of corrections in House Bill No. 5 and [section 2(1) of this act] by the 56th legislature. If the department of corrections receives or expects to receive federal department of justice funds that can be used for any department of corrections' project contained in [section 2(1)], the general obligation bond authority in [section 2(1)] for that project must be reduced by the amount of federal funds received or expected to be received and federal special revenue authority in House Bill No. 5 must be increased by a like amount and for the same purpose. In no case may general obligation bond authority increase for any department of corrections' project contained in [section 2(1)]."

NEW SECTION. Section 10. Requirements for approval of state debt. Because [section 3] authorizes the creation of state debt, a vote of two-thirds of the members of each house of the legislature is required for enactment of [section 3]. If [section 3] is not approved by the required vote, [this act] is void.

NEW SECTION. Section 11. 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 12. Effective date. [This act] is effective on passage and approval.

NEW SECTION. Section 13. Termination. [Section 9] terminates July 1, 2005.

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