74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 3759
 
                         House Bill 3530
 
Sponsored by Representative WHISNANT, Senator WESTLUND
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Allows city incorporated after certain date and not within
urban growth boundary to issue short-term obligations before
fiscal period in which tax revenues or other moneys are
anticipated.
 
                        A BILL FOR AN ACT
Relating to short-term borrowing; amending ORS 288.165.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 288.165 is amended to read:
  288.165. (1) Subject to any applicable limitations imposed by
the Constitution or laws of the State of Oregon or the charter,
ordinance or resolution of a governmental unit, a governmental
unit or the State of Oregon, acting through the State Treasurer
pursuant to ORS 293.173, may borrow money by entering into a
credit agreement, or issuing notes, warrants, short-term
promissory notes, commercial paper or other obligations:
  (a) In anticipation of tax revenues or other income for
purposes that include, but are not limited to, the payment of
current expenses;
  (b) To provide interim financing for capital assets to be
undertaken by the governmental unit; or
  (c) To refund outstanding obligations.
  (2) To secure obligations authorized under this section, a
governmental unit or the State Treasurer, acting on behalf of the
state, may:
  (a) Pledge the anticipated tax revenues or other income, the
proceeds of any bonds or other permanent financing, or any
combination thereof;
  (b) Segregate any pledged funds in separate accounts that may
be held by the governmental unit, the State Treasurer or third
parties;
  (c) Enter into contracts with third parties to obtain standby
lines of credit or other financial commitments designated to
provide additional security for obligations authorized by this
section;
  (d) Establish any reserves deemed necessary for the payment of
the obligations; and
  (e) Adopt resolutions and enter into agreements containing
covenants and provisions for protection and security of the
owners of obligations, which shall constitute enforceable
contracts with such owners.
  (3) Obligations authorized by this section that are issued in
anticipation of tax revenues or other income, except grant
income, and any obligations authorized by this section that are
issued to refund them may not be issued prior to the beginning
of, and shall mature not later than  { - , - }  the end
of { + , + } the fiscal period in which the governmental unit or
the State Treasurer expects to receive the tax revenues or other
income. Obligations issued by a governmental unit or the State
Treasurer in anticipation of tax revenues or other income, except
grant income, may not be issued in an amount greater than 80
percent of the amount budgeted to be received in the fiscal
period in which the obligations are issued.
  (4) Obligations authorized by this section that are issued in
anticipation of grant income or to provide interim financing for
capital assets shall mature not later than five years after the
obligations are issued and may be redeemed beginning not later
than one year after the governmental unit or the State Treasurer
expects to receive the grant or the capital asset is projected to
be completed.
  (5) Notwithstanding subsections (3) and (4) of this section:
  (a) A school district, education service district, community
college district or community college service district may issue
obligations that are issued in anticipation of tax revenues or
other income to mature not later than 13 months after the date
the obligations were issued.
  (b) A city that is incorporated on or after January 1, 1990,
  { - and is within an urban growth boundary - }  may issue an
obligation in anticipation of tax revenues or other income prior
to the beginning of the fiscal period in which the city expects
to receive the revenues or other income if the obligation:
  (A) Matures not later than 18 months after the obligation is
issued; and
  (B) Is issued in an amount that does not exceed 80 percent of
the amount of lawfully available funds, as defined in ORS
288.162, that the governmental unit reasonably expects to
receive.
  (6) Refunding obligations issued pursuant to subsection (1)(c)
of this section shall mature not later than five years after the
refunding obligations are issued.
  (7) The debt limitations imposed by law or the charter of any
governmental unit do not affect the right of any governmental
unit to issue obligations under authority of this section, nor
are any of the obligations to be taken into consideration in
determining the percentage or extent to which the governmental
unit is indebted under the debt limitation. Obligations issued to
refund outstanding obligations are not considered to be within
any of such debt limitations.
  (8) Except as provided in this section, obligations authorized
by this section may be in any form and contain any terms,
including provisions for redemption at the option of the owner
and provisions for the varying of interest rates in accordance
with any index, banker's loan rate or other standard.
  (9) The governing body of an issuing governmental unit, in the
ordinance or resolution authorizing the issuance of obligations
under this section, may delegate to any elected or appointed
official or employee of the governmental unit the authority to
determine maturity dates, principal amounts, redemption
provisions, interest rates or the method for determining a
variable or adjustable interest rate, denominations and other
terms and conditions of such obligations that are not
appropriately determined at the time of enactment or adoption of
the authorizing ordinance or resolution, which delegated
authority shall be exercised subject to applicable requirements
of law and such limitations and criteria as may be set forth in
such ordinance or resolution. Except to the extent of any such
 
delegation, the governmental unit or the State Treasurer shall
determine:
  (a) The maximum effective rate of interest the obligations
shall bear;
  (b) The manner of sale;
  (c) The discount, if any, the governmental unit may allow;
  (d) The terms and conditions by which the obligations may be
redeemed prior to maturity;
  (e) The maturities of the obligations;
  (f) The form and denominations of the notes or other
obligations; and
  (g) All other terms and conditions related to the sale of the
obligations.
  (10) The governmental unit or the State Treasurer may contract
with third parties to serve as issuing, paying and authenticating
agents for any obligations authorized by this section.
  (11) Obligations authorized by this section may be sold at
public or private sale upon such terms as the governmental unit
or the State Treasurer finds advantageous, with such disclosure
as the governmental unit or State Treasurer deems appropriate.
ORS 287.040 applies to obligations issued by governmental units
under this section.
  (12) As used in this section, 'fiscal period' means:
  (a) In the case of a governmental unit, a fiscal year.
  (b) In the case of the State of Oregon, a biennium.
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