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Ы x x P 7P. i A Z U n i v e r s 2 3| x c N XX 56th Legislature` T$E HB0265.01 c z N STATE INTERNET/BBS COPY * `"T$H HB 265 z 4$ HOUSE BILL NO. 265
INTRODUCED BY D. WYATT
A BILL FOR AN ACT ENTITLED: "AN ACT APPROPRIATING THE BALANCE OF OUTSTANDING COAL
SEVERANCE TAX TRUST FUND RESEARCH AND DEVELOPMENT INVESTMENTS TO THE DEPARTMENT
OF COMMERCE TO BE GRANTED TO THE INVESTMENT RECIPIENTS; AMENDING SECTION 17-6-308,
MCA; AND PROVIDING AN EFFECTIVE DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
NEW SECTION.ĠSection 1.Grant of invested funds. The outstanding balance of the research and
development investments made by the Montana board of science and technology development in the
McLaughlin research institute and the university system is appropriated to the department of commerce
to be granted to the recipient institutions as follows:
(1) McLaughlin research institute, $481,143; and
(2) Montana university system, $10,457,840.
Section 2.ĠSection 17-6-308 , MCA, is amended to read:
"17-6-308.
٠(Temporary)
Authorized investments. (1) Except as provided in subsections (2) and
(3) and subject to the provisions of 17-6-201, the Montana permanent coal tax trust fund must be
invested as authorized by rules adopted by the board.
(2)The board may make loans from the permanent coal tax trust fund to the capital reserve
account created pursuant to 17-5-1515 to establish balances or restore deficiencies in the account. The
board may agree in connection with the issuance of bonds or notes secured by the account or fund to
make the loans. Loans must be on terms and conditions determined by the board and must be repaid from
revenue realized from the exercise of the board's powers under 17-5-1501 through 17-5-1518 and
17-5-1521 through 17-5-1529, subject to the prior pledge of the revenue to the bonds and notes.
(3)The board shall allow the Montana board of science and technology development, provided
for in 2-15-1818, to administer $12.5 million of the permanent coal tax trust fund for seed capital project
loans or mezzanine financing loans and $11.1 million of the permanent coal tax trust fund for research
and development project matching funds for projects at Montana public universities. The board may grantup to $2 million of interest and income from investments to research and development projects at
Montana public universities. The research and development projects may include grant matching fund
purposes. This authority does not extend beyond June 30, 1999, for seed capital project loans and beyond
June 30, 1999, for research and development projects. Except for $915,000, all uncommitted seed
capital funds must revert to the coal severance tax permanent fund. The department may use up to
$75,000 each year of the seed capital funds for administrative purposes. The board of science and
technology development, with the concurrence of the director of the department, may extend an
additional loan to an existing seed capital portfolio company by up to $700,000. In the fiscal year ending
June 30, 1998, the department shall transfer $250,000 of interest and earnings to the Montana supreme
court to be used to fund the judges' retirement system. Until the Montana board of science and
technology development makes a loan pursuant to the provisions of Title 90, chapter 3, the funds under
its administration must be invested by the board pursuant to the provisions of 17-6-201. As seed capital
and mezzanine financing loans made pursuant to this subsection are repaid, the proceeds of the seed
capital portion of the Montana board of science and technology development loans must be deposited in
the coal severance tax permanent fund until all loans have been repaid plus the amount of 7% simple
interest for the years that the loans have been outstanding. The board shall calculate the amount of the
interest charge. The board may use up to $25,000 of the repayments for administrative costs in the fiscal
year ending June 30, 1997.
(4)The board shall adopt rules to allow a nonprofit corporation to apply for economic assistance.
The rules must recognize that different criteria may be needed for nonprofit corporations than for for-profit
corporations.
(5)Beginning July 1, 1999, all repayments proceeds in excess of $4.395 million must be
deposited in the coal severance tax permanent fund. In the fiscal year ending June 30, 1998, the
department shall transfer $250,000 from the interest and earnings from job investment loans to the
Montana supreme court to be used to fund the judges' retirement system.
17-6-308.
٠(Effective July 1, 1999)
Authorized investments. (1) Except as provided in subsections
(2) and (3) and subject to the provisions of 17-6-201, the Montana permanent coal tax trust fund must
be invested as authorized by rules adopted by the board.
(2)The board may make loans from the permanent coal tax trust fund to the capital reserve
account created pursuant to 17-5-1515 to establish balances or restore deficiencies in the account. The
board may agree in connection with the issuance of bonds or notes secured by the account or fund tomake the loans. Loans must be on terms and conditions determined by the board and must be repaid from
revenue realized from the exercise of the board's powers under 17-5-1501 through 17-5-1518 and
17-5-1521 through 17-5-1529, subject to the prior pledge of the revenue to the bonds and notes.
(3)The department shall manage the seed capital and research and development loan portfolios
created by the former Montana board of science and technology development.
The department shall
establish an appropriate repayment schedule for all outstanding research and development loans made
to the university system. The department shall report the schedule to the 56th legislature. The department
shall develop a business investment strategy for investing in Montana business and shall present the
proposal to the 56th legislature.
The department is the successor in interest to all agreements, contracts,
loans, notes, or other instruments entered into by the Montana board of science and technology
development as part of the seed capital and research and development loan portfolios. Until the
department makes a loan pursuant to the provisions of part 5 of this chapter, the $915,000 in funds
under its administration must be invested by the board pursuant to the provisions of 17-6-201. As loans
made pursuant to part 5 of this chapter are repaid, the department may reinvest the principal in new loans
pursuant to part 5 of this chapter.
(4)The board shall adopt rules to allow a nonprofit corporation to apply for economic assistance.
The rules must recognize that different criteria may be needed for nonprofit corporations than for for-profit
corporations.
(5)Beginning July 1, 1999, all repayments proceeds in excess of $4.395 million must be
deposited in the coal severance tax permanent fund.
In the fiscal year ending June 30, 1998, the
department shall transfer $250,000 from the interest and earnings from job investment loans to the
Montana supreme court to be used to fund the judges' retirement system.
"
NEW SECTION.ĠSection 3.Three-fourths vote required. Because [section 1] appropriates money
from the coal severance tax trust fund, Article IX, section 5, of the Montana constitution requires a vote
of three-fourths of the members of each house of the legislature for passage.
NEW SECTION.ĠSection 4.Effective date. [This act] is effective July 1, 1999.
j) END