House Bill No. 188
Introduced By denny, cole
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:
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].
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 $14,000,000
(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) 19,800,000
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 3,200,000
DEPARTMENT OF CORRECTIONS
Information Technology Plan 1,890,408
Section 3. Authorization of bonds. (1) The board of examiners may issue and sell general obligation information technology bonds in an amount not exceeding $42,990,408 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].
(3) It is the intent of the 55th legislature that bonds sold to purchase equipment be issued for a term that reflects the life of the assets. Therefore, of the $33.8 million in bonding for the integrated revenue and tax systems and the MT PRRIME projects, $1.75 million in bonds must be sold for a term of 4 years and $4.45 million in bonds must be sold for a term of 5 years. The remaining $27.6 million in bonds for these projects must be sold for a term of 10 years.
(4) It is the intent of the 55th legislature that if money becomes available from the federal department of labor for year 2000 compliance, the money must be used to pay debt service or retire outstanding principal on the $3.6 million worth of bonds issued for the unemployment benefit package project. However, the Montana department of labor and industry shall maintain the flexibility to use some of the federal funds to replace base grant funds expended for year 2000 compliance purposes.
(5) It is the intent of the 55th legislature that bonds sold to purchase equipment be issued for a term that reflects the life of the assets. Therefore, of the $1,890,408 in bonding for the department of corrections information technology plan, $913,908 in bonds must be sold for a term of 5 years and $976,500 in bonds must be sold for a term of 10 years.
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.
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.
Section 6. Allocation of selected debt service costs. (1) The department of administration shall allocate $11,000,000 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.
Section 7. Agreements for other funding sources. 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:
(1) income from the sale of the respective principal amount of bonds must be credited to the entity's repayment obligation;
(2) payment must be made from available funds; and
(3) 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:
(a) $1,250,000 from the department of revenue for revenue and integrated tax systems;
(b) $3,600,000 from the department of labor and industry for the unemployment insurance benefit package; and
(c) $1,600,000 from the Montana university system.
(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.
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.
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.
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.
Section 11. Effective date. [This act] is effective on passage and approval.