Report Title:
Special Facility Projects
Description:
Allows the BLNR to make available lower cost financing through the issuance of special facility revenue bonds for the construction, acquisition, remodeling, furnishing, and equipping of special facilities.
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THE SENATE |
S.B. NO. |
2801 |
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TWENTY-FIRST LEGISLATURE, 2002 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO SPECIAL FACILITY PROJECTS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Findings and purpose. The legislature finds and declares that the ocean recreation industry is essential to the social and economic well-being of the people of the State of Hawaii; that the boating facilities of the department of land and natural resources provide vital access to the waters of the State to support the ocean recreation industry that in 1997 generated gross revenues estimated at $767 million; that the cost of developing and operating state boating facilities is incorporated in the rates and charges assessed to the users thereof, which in turn are passed on by commercial operators to the general public; that one of the economic factors that has a long-term adverse impact upon the users and the general public is the high cost of financing of construction of boating special facilities through conventional means; that the availability and use of lower cost financing for that purpose will have a favorable financial impact on the development and operation of boating facilities supporting the ocean recreation industry which in turn will benefit the users and the general public; and that it is therefore in the public interest and a public purpose that the board of land and natural resources be allowed to make available lower cost financing through the issuance of special facility revenue bonds for the construction, acquisition, remodeling, furnishing, and equipping of state-owned boating facilities, for use by persons engaging in maritime and ocean-based recreation operations as leasehold tenants thereof.
SECTION 2. Chapter 200, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:
"PART . SPECIAL FACILITY PROJECTS
§200- Definitions. For the purpose of this part, if not inconsistent with the context:
"Remodeling" means reconstruction, renovation, rehabilitation, improvement, betterment, or extension of a special facility.
"Special facility" means one or more buildings, structures, or facilities on land owned by the State for boating facility operations, including small cargo handling and control; ferry and passenger terminal operations; storage, repair, maintenance, and servicing of marine and marine-related equipment; processing of fish and fish products; and offices and accommodations for the personnel and employees of persons engaged in maritime and maritime-related operations that are the subject of a special facility lease.
"Special facility lease" means a contract, lease, or other agreement, or any combination thereof, the subject matter of which is a special facility.
§200- Powers. In addition and supplemental to the powers granted to the board by law, the board may:
(1) With the approval of the governor, and without public bidding, enter into a special facility lease or an amendment or supplement thereto whereby the board agrees with another party engaged in maritime and ocean-based recreation and related operations to construct, acquire, remodel, furnish, or equip a special facility solely for the use by another person to a special facility lease;
(2) With the approval of the governor:
(A) Issue special facility revenue bonds in such principal amounts as may be necessary to yield the amount of the cost of any construction, acquisition, remodeling, furnishing, and equipping of any special facility; provided that the total principal amount of the special facility revenue bonds which may be issued pursuant to the authorization of this subparagraph shall not exceed $100,000,000;
(B) Issue special facility revenue refunding bonds, without further authorization by the legislature, to refund outstanding special facility revenue bonds, including special facility revenue refunding bonds, or any part thereof, at or before the maturity or redemption date, issued pursuant to this part; provided that any issuance of the refunding bonds shall not reduce the amount authorized by the legislature as provided in paragraph (2)(A).
(3) Perform and carry out the terms and provisions of any special facility lease.
(4) Notwithstanding section 103-7 or any other law to the contrary, acquire, construct, remodel, furnish, or equip any special facility, or accept the assignment of any contract therefor entered into by the other party to the special facility lease.
(5) Construct any special facility on land owned by the State.
(6) Agree with the other party to the special facility lease whereby any acquisition, construction, remodeling, furnishing, or equipping of the special facility and the expenditure of moneys therefor shall be undertaken or supervised by such other party. Neither such undertaking by such other person nor the acceptance by the board of a contract theretofore entered into by such other party, shall be subject to chapter 103D.
§200- Findings and determination for special facility leases. The board shall not enter into any special facility lease unless it first finds and determines that:
(1) The special facility which is to be the subject of the special facility lease will not be used to provide services, commodities, supplies, or facilities which are then adequately being made available through the small boat harbors system of the State;
(2) The use or occupancy of the special facility under such special facility lease would not result in the reduction of the revenues derived from the small boat harbors system to an amount below the amount required to be derived therefrom by section 39-61; and
(3) The entering into of such special facility lease would not be in violation of or result in a breach of any covenant contained in any resolution or certificate authorizing any bonds of the State and the department then outstanding.
§200- Special facility lease. (a) In addition to the conditions and terms set forth in this part, any special facility lease entered into by the board shall contain provisions obligating the other party to the special facility lease:
(1) To pay to the board during the term of the special facility lease, whether the special facility is capable of being used or occupied or is being used or occupied by the other party, a rental or rentals at such time or times and in such amount or amounts as will be sufficient: to pay the principal and interest on all special facility revenue bonds issued for the special facility, to establish or maintain any reserves for such payments, and to pay all fees and expenses of the trustees, paying agents, transfer agents, and other fiscal agents for the special facility revenue bonds issued for the special facility.
(2) To pay to the board a ground rental equal to the fair market rental of the land, if the special facility is situated on public land owned by the State.
(3) To either operate, maintain, and repair the special facility and pay the costs thereof or to pay to the board all costs of operation, maintenance, and repair of the special facility.
(b) Any moneys derived by the board pursuant to subsection (a)(1) shall be deemed revenues of the special facility. Any moneys received by the board pursuant to subsection (a)(2) and (3) shall be paid into the boating special fund and shall not be nor be deemed to be revenues of the special facility.
(c) The term and all renewals and extensions of the term of any special facility lease (including any amendments or supplements thereto) shall not extend beyond the reasonable life of the special facility which is the subject of the special facility lease, as estimated by the board at the time of the entering into thereof, or fifty-five years pursuant to section 200-2.5, whichever is less.
(d) Any special facility lease entered into by the board shall be subject to chapter 171 and section 200-2.5 and shall contain such other terms and conditions as the board deems advisable to effectuate the purposes of this part.
§200- Special facility revenue bonds. All special facility revenue bonds, including special facility revenue refunding bonds, authorized to be issued shall be issued pursuant to part III of chapter 39, except as follows:
(1) No revenue bonds shall be issued unless at the time of issuance the board shall have entered into a special facility lease with respect to the special facility for which the revenue bonds are to be issued.
(2) The revenue bonds shall be issued in the name of the board, and not in the name of the State.
(3) No further authorization of the legislature shall be required for the issuance of the special facility revenue bonds, but the approval of the governor shall be required for the issuance.
(4) The revenue bonds shall be payable solely from and secured solely by the revenues derived by the department from the special facility for which they are issued, as defined in section 200- (1).
(5) The final maturity date of the revenue bonds shall not be later than either the estimated life of the special facility for which they are issued or the initial term of the special facility lease.
(6) If deemed necessary or advisable by the board, or to permit the obligations of the other party to the special facility lease to be registered under the United States Securities Act of 1933, the board with the approval of the state director of finance may appoint a national or state bank within or without the State to serve as trustee for the holders of the revenue bonds and may enter into a trust indenture or trust agreement with the trustee. The trustee may be authorized by the board to collect, hold, and administer the revenues derived from the special facility for which the revenue bonds are issued and to apply such revenues to the payment of the principal and interest on the revenue bonds. In the event that any trustee shall be appointed, any trust indenture or agreement entered into by the board with the trustee may contain the covenants and provisions authorized by part III of chapter 39 to be inserted in a resolution adopted or certificate issued, as though the words "resolution" or "certificate" as used in that part read "trust indenture or agreement." The covenants and provisions shall not be required to be included in the resolution or certificate authorizing the issuance of the revenue bonds if included in the trust indenture or agreement. Any resolution or certificate, trust indenture, or trust agreement adopted, issued, or entered into by the board pursuant to this part may also contain any provisions required for the qualification thereof under the United States Trust Indenture Act of 1939. The board may pledge and assign to the trustee the special facility lease and the rights of the board including the revenues thereunder.
(7) If the board with the approval of the state director of finance shall have appointed or shall appoint a trustee for the holders of the revenue bonds, then notwithstanding the second sentence of section 39-68 the state director of finance may elect not to serve as fiscal agent for the payment of the principal and interest, and for the purchase, registration, transfer, exchange, and redemption, of the revenue bonds, or may elect to limit the functions the state director of finance shall perform as such fiscal agent. The board with the approval of the state director of finance may appoint the trustee to serve as such fiscal agent, and may authorize and empower the trustee to perform such functions with respect to such payment, purchase, registration, transfer, exchange, and redemption, as the board may deem necessary, advisable, or expedient, including, without limitation, the holding of the revenue bonds and coupons which have been paid, and the supervision and destruction thereof in accordance with sections 40-10 and 40-11. Nothing in this paragraph shall be a limitation upon or be construed as a limitation upon the powers granted in the preceding paragraph to the board with the approval of the state director of finance to appoint the trustee, or granted in sections 36-3 and 39-13 and the third sentence of section 39-68 to the state director of finance to appoint the trustee or others, as fiscal agents, paying agents, and registrars for the revenue bonds or to authorize and empower the fiscal agents, paying agents, and registrars to perform the functions referred to in those paragraphs and sections, it being the intent of this paragraph to confirm that the state director of finance as aforesaid may elect not to serve as fiscal agent for the revenue bonds or may elect to limit the functions the state director of finance shall perform as such fiscal agent, as the state director of finance may deem necessary, advisable, or expedient.
(8) The board may sell such revenue bonds either at public or private sale.
(9) If no trustee is appointed to collect, hold, and administer the revenues derived from the special facility for which such revenue bonds are issued, such revenues shall be held in a separate account in the treasury of the State, separate and apart from the boating special fund, to be applied solely to carrying out the resolution, certificate, trust indenture, or trust agreement authorizing or securing the revenue bonds.
(10) If the resolution, certificate, trust indenture, or trust agreement provides that no revenue bonds issued thereunder are valid or obligatory for any purpose unless certified or authenticated by the trustee for the holders of the revenue bonds, signatures of the officers of the State upon the bonds and the coupons thereof as required by section 39-56 may be evidenced by their facsimile signatures.
(11) The proceeds of such revenue bonds may be used and applied by the board to reimburse the other party to the special facility lease for all preliminary costs and expenses, including architectural and legal costs.
(12) If the special facility lease requires the other party to operate, maintain, and repair the special facility that is the subject of such lease, at the other party's expense, this requirement shall constitute compliance by the board with section 39-61(a)(2), and none of the revenues derived by the board from such special facility shall be required to be applied to the purposes of section 39-62(2). Sections 39-62(4), 39-62(5), and 39-62(6) shall not be applicable to the revenues derived from a special facility lease."
SECTION 3. This Act shall take effect upon its approval.
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INTRODUCED BY: |
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