Chapter 111 Oregon Laws 2005

AN ACT

HB 2032

Relating to cash flow projection for bond issuance; creating new provisions; and amending ORS 286.105 and 286.125.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 286.105 is amended to read:

286.105. (1) Before requesting the State Treasurer to issue general obligation bonds or revenue bonds authorized by law, a state agency must prepare a cash flow projection that details anticipated program revenues and includes a list of all significant assumptions of the cash flow model and the state agency’s estimate of the likelihood that the assumptions will materialize.

(2) The treasurer shall review the cash flow projection and:

(a) Approve the cash flow projection and notify the state agency in writing; or

(b) If the treasurer determines that the cash flow projection and underlying assumptions supplied by the agency are unreasonable or do not fairly represent a likely set of events, the treasurer shall notify the state agency of the determination in writing and may require additional cash flow projections to be computed using assumptions supplied by the treasurer.

(3) The [State Treasurer shall issue no bonds for any] treasurer may not issue general obligation bonds or revenue bonds for a state agency [authorized to operate a program using proceeds from general obligation or revenue bonds,] until:

[(1) The agency has prepared and submitted, and the State Treasurer has approved, a cash flow projection detailing program revenues, if any, and their sufficiency to meet debt service requirements. The projections shall include a listing of all significant assumptions of the cash flow model and the agency’s estimate of the likelihood that such assumptions will materialize. If the State Treasurer determines, and notifies the agency in writing, that the cash flow projection and underlying assumptions supplied by the agency are unreasonable or do not fairly represent a likely set of events, the State Treasurer may require additional cash flow projections to be computed using assumptions supplied by the State Treasurer.]

(a) The treasurer has approved the cash flow projection required in subsection (1) of this section; and

[(2)] (b) If a financial consultant is retained as provided for in ORS 286.071 to assist with the bond program, the consultant has attested that the cash flow projection required in subsection (1) of this section contains all significant disclosures and all significant underlying assumptions necessary to provide a reasonable basis for [that] the projection.

SECTION 2. ORS 286.125 is amended to read:

286.125. Notwithstanding ORS 286.105 or 286.115, the State Treasurer may exempt [any] a program or transaction from any or all of the requirements of ORS 286.105 [and] or 286.115 [on finding] after making one or more of the following findings:

(1) The program or transaction does not significantly affect the financial integrity of the state[.];

(2) Bond-related costs that come due after issuance will be paid from moneys to be appropriated by the Legislative Assembly in the future;

(3) The moneys to pay bond-related costs will be available and unobligated at the time of issuance; or

(4) The treasurer finds that compliance with ORS 286.105 or 286.115 does not assist the treasurer in evaluating whether adequate revenues will be available to pay bond-related costs that come due after issuance.

SECTION 3. The amendments to ORS 286.105 and 286.125 by sections 1 and 2 of this 2005 Act apply to general obligation bonds or revenue bonds issued on or after the effective date of this 2005 Act.

Approved by the Governor June 6, 2005

Filed in the office of Secretary of State June 7, 2005

Effective date January 1, 2006

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