[As Amended by Senate Committee of the
Whole]
As Amended by Senate Committee
Session of 1998
SENATE BILL No. 648
By Committee on Ways and Means
2-12
12
AN ACT creating the transportation capital
enhancement fund; financing
13 city, county and other
subdivisions in the state of Kansas; building and
14 maintaining roads and
highways and other transportation facilities;
15 amending K.S.A.
68-2315 and repealing the existing section.
16
17 Be it enacted by the Legislature of the
State of Kansas:
18 New Section 1. (a)
In order to provide for the planning, development
19 and operation of the various modes and
systems of transportation within
20 the state of Kansas, the secretary of
transportation is authorized to estab-
21 lish a transportation capital enhancement
fund to provide assistance to
22 cities, counties and other subdivisions of
government for transportation
23 projects.
24 (b) It is the intent of
the legislature that the transportation capital
25 enhancement fund increase the state's
participation in partnership with
26 the cities, counties and other subdivisions
of government for transporta-
27 tion projects both on and off the state
highway system, in order to:
28 (1) Substantially
improve safety;
29 (2) preserve
transportation facilities;
30 (3) relieve congestion
or improve accessibility; and
31 (4) enhance economic
development.
32 (c) Further, it is the
intent of the legislature that the transportation
33 capital enhancement fund be used to
facilitate department of transpor-
34 tation projects on the state highway system
and the receipt of federal aid.
35 New Sec. 2. As used
in this act:
36 (a) ``Bonds'' means any
bonds, notes or other evidences of indebt-
37 edness, including book-entry-only, whether
or not the interest on such
38 bonds is subject to federal income
taxation, issued pursuant to this act or
39 by a qualified borrower.
40 (b) ``Book-entry-only''
means a system of electronic clearance, settle-
41 ment and transfer of security ownership
without the use of certificated
42 securities.
43 (c) ``Cost,'' as applied
to any qualified project means any or all costs,
SB 648--Am. by SCW
2
1 whenever incurred, approved by the
department, of carrying out a qual-
2 ified project including, costs for
preliminary planning, legal, fiscal and
3 economic investigations, reports and
studies to determine the economic
4 or engineering feasibility of a
qualified project; engineering and architec-
5 tural reports, studies, surveys,
designs, plans, working drawings and spec-
6 ifications necessary in the
construction of a qualified project; construction;
7 expansion; facilities; improvement
and rehabilitation; acquisition of real
8 property, personal property,
materials, machinery or equipment; start-up
9 costs; demolitions and relocations;
reasonable reserves and working cap-
10 ital; interest on loans, borrower
obligations and notes in anticipation
11 thereof prior to and during construction of
any such qualified project or
12 prior to the date of such loan, if later;
project related administrative, legal
13 and financing expenses; and other expenses
necessary or incidental to any
14 of the above.
15 (d) ``Department'' means
the Kansas department of transportation
16 established under K.S.A. 75-5001 and
amendments thereto.
17 (e) ``Financial
assistance'' means any financial assistance for a quali-
18 fied project provided by the department
under the program, including
19 loans to and leases with qualified
borrowers, the establishment of reserves
20 and other security, and guarantees of and
credit enhancement for the
21 obligations of subdivisions of government
and private enterprises incurred
22 in connection with the financing of
qualified projects.
23 (f) ``Fund'' means the
Kansas transportation capital enhancement
24 fund established by this act.
25 (g) ``General
revenues,'' when used with reference to a subdivision
26 of government, includes revenues, receipts,
assessments and other money
27 of a subdivision of government, and all
rights to receive the same. General
28 revenues do not include money restricted by
law to specific statutorily
29 defined purposes inconsistent with their
treatment as general revenues
30 for purposes of this act.
31 (h) ``Government
obligations'' or ``governmental obligations'' means
32 bonds, notes or other evidence of
indebtedness issued by a subdivision
33 of government to evidence a loan.
34 (i) ``KDFA'' means the
Kansas development finance authority estab-
35 lished pursuant to K.S.A. 74-8903 and
amendments thereto.
36 (j) ``Highway account''
means the highway account of the fund, es-
37 tablished pursuant to this act.
38 (k) ``Federal act'' or
``federal acts'' means the intermodal surface
39 transportation efficiency act of 1991
(ISTEA) as amended and the na-
40 tional highway system designation (NHS) act
of 1995 as amended and
41 successor federal acts which authorize and
enable FHWA, FRA, FAA
42 and FTA participation and funding of a
transportation capital enhance-
43 ment fund program including the federal
acts which govern the use of
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1 federal highway trust funds.
2 (l) ``Lease''
means any form of capital or operating lease agreement
3 for all or a portion of a qualified
project, between the department, or any
4 office or agency thereof, and a
subdivision of government or a private
5 enterprise.
6 (m) ``Loan
agreement'' means any agreement entered into between
7 the department and a qualified
borrower pertaining to a loan or lease. A
8 loan agreement may contain, in
addition to financial terms, provisions
9 relating to the regulation and
supervision of a qualified project or any
10 other provisions the secretary reasonably
determines. The term ``loan
11 agreement'' includes a loan agreement,
lease, trust agreement, trust in-
12 denture, security agreement, reimbursement
agreement, guarantee
13 agreement, bond or note resolution, loan
order or similar instrument
14 whether secured or unsecured.
15 (n) ``Private
enterprise'' means a private person or entity that has
16 entered into a contract with a subdivision
of government to design, fi-
17 nance, construct or operate a qualified
project that is within the jurisdic-
18 tion of such subdivision of government, if
such subdivision of government
19 is responsible for complying with all
applicable requirements of federal
20 acts with respect to such qualified
project.
21 (o) ``PMIB'' means the
pooled money investment board established
22 pursuant to K.S.A. 75-4221a and amendments
thereto.
23 (p) ``Program'' means
the transportation capital enhancement fund
24 program established pursuant to this
act.
25 (q) ``Project'' means
the acquisition, construction, reconstruction, im-
26 provement, repair, rehabilitation,
maintenance or extension of transpor-
27 tation facilities.
28 (r) ``Project costs''
means all costs or expenses which are necessary or
29 incident to a project and which are
directly attributable thereto.
30 (s) ``Project revenues''
means all rates, rents, fees, assessments,
31 charges and other receipts derived or to be
derived by a qualified bor-
32 rower from a qualified project, and, where
provided in the applicable loan
33 agreement entered into pursuant to this
act, from any system of which
34 such qualified project is a part and any
other revenue producing facilities
35 under the ownership or control of such
qualified borrower, including,
36 without limitation, proceeds of grants,
gifts, appropriations and loans,
37 including the proceeds of loans or grants
made by the department, in-
38 vestment earnings, reserves for capital and
current expenses, proceeds of
39 insurance or condemnation and the sale or
other disposition of property.
40 Project revenues do not include any ad
valorem taxes levied directly by a
41 subdivision of government on any real and
personal property.
42 (t) ``Qualified
borrower'' means any subdivision of government or pri-
43 vate enterprise which is authorized to
construct, operate or own a qual-
SB 648--Am. by SCW
4
1 ified project.
2 (u) ``Qualified
project'' means any public or private construction, re-
3 construction, resurfacing, restoring,
rehabilitation or replacement of pub-
4 lic or private transportation
facilities within the state of Kansas including
5 rail, port and air, or the study of
the feasibility thereof; any highway,
6 transit or transportation project
eligible for financing or aid under any of
7 the federal acts or programs. It also
means any project involving the main-
8 taining, repairing, improving or
constructing of any city, county or state
9 highway including roads, streets and
parkways, and any rights-of-way,
10 bridges, tunnels, railroad-highway
crossings, drainage structures, signs,
11 guardrails, and protective structures
constructed or used in connection
12 with any highway transportation or transit
project.
13 (v) ``Regional
governmental unit'' means a government unit which is
14 authorized to construct, own, operate or
has jurisdiction over a qualified
15 project on behalf of two or more cities,
counties or other subdivisions of
16 government, or designated parts thereof,
and which derives all or part of
17 its general revenues or project revenues by
assessment or other charges
18 on such subdivisions of government.
19 [(w) ''Residual
equity transfer`` means any non-recurring or
20 non-routine transfers of equity
between funds.]
21 (w)
[(x)] ``Revenues'' when used with respect to the
department,
22 means any receipts, fees, revenues or other
payments received or to be
23 received by the department under the
program, including receipts and
24 other payments received by or deposited in
the fund, payments of prin-
25 cipal, interest or other charges on loans,
leases, grants, appropriations or
26 other financial assistance from the state
of Kansas or the United States
27 or any subdivision of government or
instrumentality of either in connec-
28 tion with the program, investment earnings
on funds therein and ac-
29 counts, including the fund, and any other
fees, charges or other income
30 received or receivable by the fund or the
department under the program.
31 (x)
[y] ``Secretary'' means the secretary of the
Kansas department of
32 transportation.
33 (y)
[z] ``State aid distributions'' means any
receipts, distributions, re-
34 imbursements or other assistance payable by
the state of Kansas to or for
35 the account of a subdivision of
government.
36 (z)
[aa] ``Subdivision of government'' means any
city, district, county,
37 commission, agency, authority, board or
other instrumentality of the state
38 or of any of its political subdivisions,
including any regional governmental
39 unit, which is responsible for the
construction, ownership or operation of
40 a qualified project.
41 (aa)
[bb] ``Transit account'' means the transit
account of the fund,
42 established pursuant to the provisions of
section 7.
43 (bb)
``Trust agreement'' means any agreement entered into by
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1 the department when required by the
secretary, the state treasurer or the
2 PMIB providing for the issuance,
security and payment of bonds issued
3 pursuant to this act. The term
``trust agreement'' shall include a trust
4 agreement, trust indenture, security
agreement, reimbursement agree-
5 ment, currency or interest rate
exchange agreement, bond or note reso-
6 lution or other similar
instrument.
7 New
Sec. 3. The secretary shall administer the provisions of
this act
8 and shall be responsible for the
administration and management of the
9 fund, in addition to any other powers
and duties conferred or imposed
10 upon the secretary by this act or any other
general or special law, and
11 shall have the power to enter into
agreements and contracts and to trans-
12 fer money between the state highway fund
and the fund as required to
13 effect the purposes of this act
except that the total amount
transferred
14 from the state highway
fund to the fund [residual equity
transfers
15 from the state highway fund made for
the purposes of capitalizing
16 the fund] shall not
exceed the total amount authorized to be trans-
17 ferred by appropriation act.
No expenditure from such fund
shall
18 be made except upon
approval of the state finance council
acting
19 on this matter which is
hereby characterized as a matter of legis-
20 lative delegation and
subject to the guidelines prescribed in
sub-
21 section (c) of K.S.A.
75-3711c and amendments thereto. The
secretary
22 shall adopt rules and regulations to carry
out the purposes and provisions
23 of this act.
24 New Sec. 4. (a)
There is hereby established in the state treasury a
25 fund to be maintained in perpetuity and to
be known as the Kansas trans-
26 portation capital enhancement fund. The
fund shall consist of:
27 (1) Amounts awarded or
otherwise made available to the state of Kan-
28 sas under the federal acts for the purposes
of the fund;
29 (2) amounts appropriated
or otherwise made available by the legis-
30 lature for the purposes of the fund;
31 (3) the proceeds, if
any, derived from the sale of bonds issued by the
32 secretary, KDFA, or other entity pursuant
to this act for the purposes of
33 the fund;
34 (4) amounts of
repayments made by qualified borrowers of loans re-
35 ceived under this act and amendments
thereto, together with payments
36 of interest thereon, and such other fees
and charges as are related thereto
37 in accordance with agreements entered into
by qualified borrowers and
38 the secretary;
39 (5) amounts earned on
moneys in the fund;
40 (6) amounts contributed
or otherwise made available by any public
41 or private entity for use in effectuating
the purposes of the fund; and
42 (7) amounts transferred
into the fund by order of the secretary from
43 the state highway fund in accordance
with the provisions of section
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1 3 and amendments
thereto.
2 (b) Subject to the
conditions and in accordance with requirements of
3 the federal acts and the provisions
of this act and amendments thereto,
4 expenditures from the fund shall be
made for the following purposes:
5 (1) For the
payment of the principal of, including sinking fund pay-
6 ments and premium, if any, and
interest on bonds of the state, as de-
7 scribed in this act, issued for the
purpose of financing or refinancing any
8 cost of a qualified project;
9 (2) for providing
financial assistance to qualified borrowers to finance
10 qualified projects;
11 (3) for the maintenance
of, or provision for, any reserves, additional
12 security, insurance or other form of credit
enhancement required or pro-
13 vided for in any trust agreement entered
into pursuant to this act to secure
14 such bonds;
15 (4) to guarantee, or
purchase insurance or provide other credit en-
16 hancement for bonds of qualified borrowers
issued to finance the costs
17 of qualified projects;
18 (5) to provide reserves
for or otherwise secure bonds issued pursuant
19 to this act and to provide insurance or
other credit enhancement for such
20 bonds;
21 (6) to provide reserves
for, or to otherwise secure, amounts payable
22 by qualified borrowers on loans made by and
leases with the department
23 in the event of default by a particular
qualified borrower or, on a parity
24 basis, by any qualified borrower;
25 (7) to provide a subsidy
for, or to otherwise assist, qualified borrowers
26 in the payment of costs authorized by the
secretary related to loans made
27 by the department;
28 (8) for administrative
costs of the program or for any of the foregoing;
29 and
30 (9) the transfer of
money by order of the secretary to the state high-
31 way fund.
32 (c) All payments and
disbursements from the fund shall be made
33 upon warrants of the director of accounts
and reports issued pursuant to
34 vouchers approved by the secretary or by a
person or persons designated
35 by the secretary.
36 (d) The department shall
establish the highway account and the tran-
37 sit account, as provided in this act, and
one or more additional accounts
38 and sub-accounts within the fund as
necessary to meet the requirements
39 of the federal acts and any other
applicable federal law requirement or
40 as the department deems necessary or
desirable in order to implement
41 the provisions of this act or to comply
with any trust agreement. The
42 department may also establish in the
state treasury pursuant to any
43 trust agreement or otherwise, as the
secretary shall determine, one or
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1 more other funds and accounts for
revenues and other money not re-
2 quired to be held in the fund, and to
apply and disburse such money and
3 revenues for the purposes of the
program.
4 (e) In
administering the program, the secretary may require subdi-
5 visions of government to utilize the
services of the Kansas development
6 finance authority to issue bonds or
other authorized evidences of debt to
7 be utilized as part of a loan
agreement.
8 New
Sec. 5. Subject to appropriations acts, the secretary
shall have
9 responsibility for the management of
the fund and shall provide, by res-
10 olution, for amounts and duration of
investments and reinvestments of
11 moneys in the fund. The resolution may
recommend investment and re-
12 porting policies, including acceptable
levels of return, risk and security.
13 Except for loans made to a qualified
borrower for the purpose of trans-
14 portation
qualified projects or the purchase of bonds or other
authorized
15 evidence of debt issued by a qualified
borrower for the purpose of a
16 transportation
qualified project and after consultation with the
secretary,
17 the pooled money investment board shall
have the authority to invest and
18 reinvest moneys in the fund and to acquire,
retain, manage, including the
19 exercise of any voting rights, and dispose
of investments of the fund. In
20 investing or reinvesting moneys in the
fund, there shall be exercised the
21 judgment and care under the circumstances
then prevailing and consis-
22 tent with the purposes of this act which
persons of prudence, discretion
23 and intelligence exercise in the management
of their own affairs, not in
24 regard to speculation but in regard to the
permanent disposition of their
25 funds, considering the probable income as
well as the probable safety of
26 their capital, except that moneys in the
fund may not be invested in com-
27 mon stock. Notwithstanding anything to the
contrary, all interest or other
28 income of the investments, after payment of
any management fees, shall
29 be considered income of the fund.
30 New Sec. 6. The
secretary shall develop a priority system for projects
31 in conformance with applicable provisions
of the federal acts.
32 Section 7. K.S.A.
68-2315 is hereby amended to read as follows:
33 68-2315. Annually, prior to the 10th day of
each regular session of the
34 legislature, the secretary of
transportation shall submit a written report
35 to the governor and each member of the
legislature providing:
36 (a) A comprehensive
financial report of all funds for the preceding
37 year which shall include a report by
independent public accountants at-
38 testing that the financial statements
present fairly the financial position
39 of the Kansas department of transportation
in conformity with generally
40 accepted accounting principles;
41 (b) a detailed
explanation of the methods or criteria employed to
42 select construction projects, including a
definition of the program ele-
43 ments in subsections (a) and (b) of K.S.A.
68-2314 and amendments
SB 648--Am. by SCW
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1 thereto;
2 (c) the proposed
allocation and expenditure of moneys and proposed
3 work plan for the current fiscal year
and at least the next five years;
4 (d) information
concerning construction work completed in the pre-
5 ceding fiscal year and construction
work in progress;
6 (e) the
activities and use of the transportation capital
enhancement
7 fund;
8 (e)
(f) specific recommendations for any statutory changes
necessary
9 for the efficient and effective
operation of the Kansas department of
10 transportation; and
11 (f)
(g) an explanation of any material changes from the
previous an-
12 nual report. Prior to the 10th day of
each regular session of the leg-
13 islature commencing with the 1999
legislative session through the
14 2001 legislative session, the
secretary of transportation shall submit
15 a written report to each member of
the committee on transportation
16 and tourism and the committee on ways
and means of the senate
17 and to each member of the committee
on transportation and the
18 committee on appropriations of the
house of representatives detail-
19 ing all transfers from the state
highway fund to the transportation
20 capital enhancement fund during the
preceding calendar year.
21 Commencing with the 2002 legislative
session such information
22 shall be included as part of the
annual report under this section.
23 New Sec. 8. (a)
Qualified borrowers which desire assistance in the
24 form of a loan, credit enhancement or grant
under this act shall submit
25 an application therefor to the secretary.
Applications shall be in the form
26 and shall include information the secretary
requires and shall be submit-
27 ted in a manner and at a time to be
determined by the secretary.
28 (b) The secretary may
enter into agreements with any qualified bor-
29 rower for the provision of assistance
thereto for payment of all or a part
30 of project costs and any subdivision of
government may enter into such
31 an agreement and may accept such assistance
when authorized by its
32 governing body. The purposes of the
assistance to be provided, the form
33 of the assistance, the amount thereof, the
interest rate thereon, and the
34 repayment terms and conditions thereof, all
of which may vary among
35 subdivisions of government, shall be
included in the agreements. Assis-
36 tance may provide for the purchase of bonds
issued by a qualified bor-
37 rower. Assistance in the form of loans may
be provided at or below their
38 current market interest rates or may be
provided interest free. In the case
39 of assistance in the form of a loan, all
such agreements at a minimum
40 shall require that:
41 (1) The subdivision of
government establishes a dedicated source of
42 revenue for repayment of the loans which
may include unlimited ad va-
43 lorem property taxes levied in accordance
with the loan agreement;
SB 648--Am. by SCW
9
1 (2) shall further
provide that repayment of any loan received shall
2 begin not later than one year after
completion of the project; and
3 (3) that such loan
shall be repaid in full no later than 20 years after
4 completion of the project.
5 (c) In the event
any subdivision of government to which a commit-
6 ment for assistance is made under
this act fails to enter into an agreement
7 with the secretary for such
assistance, in accordance with the require-
8 ments of this act or other applicable
state or federal law, the secretary
9 may make the amount of the assistance
available to one or more other
10 projects.
11 (d) The secretary shall
provide any subdivision of government, upon
12 its request, with technical advice and
assistance regarding a project or an
13 application for assistance. The secretary
may assess reasonable fees for
14 providing such assistance.
15 New Sec. 9. (a)
Upon the failure of a subdivision of government to
16 perform any of the terms and conditions of
any agreement with the sec-
17 retary under this act, the secretary may
order the state treasurer to pay
18 to the secretary such portion of the
subdivision of government's share of
19 the special city and county highway fund as
may be necessary to satisfy
20 the terms of such agreement. Distributions
to the cities and counties
21 pursuant to K.S.A. 79-3425c and amendments
thereto shall be computed
22 prior to considering any distribution to
the secretary under this section.
23 For counties required pursuant to
subsection (b) of K.S.A. 79-3425c and
24 amendments thereto to distribute a portion
of their special city and
25 county highway fund money to the cities
located within their county, the
26 secretary shall not order the state
treasurer to pay to the secretary an
27 amount in excess of that to be retained by
the county pursuant to statute.
28 Counties will compute and distribute moneys
to the several cities located
29 within their county, as required by
subsection (b) of K.S.A. 79-3425c and
30 amendments thereto as if the secretary had
not ordered the state trea-
31 surer to pay to the secretary funds to be
distributed to the county.
32 (b) Qualified borrowers
receiving assistance under this act and
33 amendments thereto shall maintain project
accounts in accordance with
34 generally accepted government accounting
standards and shall provide to
35 the secretary access to all project records
upon the secretary's request
36 and without the necessity of prior
notice.
37 (c) Except as provided
by law, subdivisions of government receiving
38 federal funds under the federal acts with
respect to project costs for which
39 a loan was provided under the provisions of
this act and amendments
40 thereto shall promptly repay such loan to
the extent of the federal funds
41 received under the federal act.
42 (d) Any loans received
by a subdivision of government under the pro-
43 visions of this act and amendments thereto
shall be construed to be bonds
SB 648--Am. by SCW
10
1 for the purposes of K.S.A. 10-1116
and 79-5028 and amendments thereto,
2 and the amount of such loans shall
not be included within any limitation
3 on the bonded indebtedness of such
subdivision of government.
4 New
Sec. 10. (a) For the purpose of this act, the
secretary may issue
5 bonds of the state of Kansas,
payable solely from revenues accruing to
6 the fund and the state
highway fund and transferred to the transportation
7 capital enhancement bond debt
service fund and pledged to their pay-
8 ment, for the purpose of
capitalizing the fund and providing funds to
9 provide assistance to
subdivisions of government for transportation pro-
10 jects and to pay all expenses
incidental thereto and to the bonds. The
11 total principal amount of bonds
issued by the secretary to capitalize the
12 fund which may be outstanding shall
not exceed $50,000,000. the sec-
13 retary for the purpose of making
loans to subdivisions of govern-
14 ment for qualified projects and to
pay all expenses incidental
15 thereto and to the bonds may issue
revenue bonds or enter into
16 agreements with the Kansas
development finance authority to issue
17 revenue bonds payable solely from
revenues accruing to the fund.
18 In accordance with procurement statutes,
the secretary may contract with
19 financial advisors, attorneys and such
other professional services as the
20 secretary deems necessary to carry out the
provisions of this act, and to
21 do all things necessary or convenient to
carry out the powers expressly
22 granted in this act. Notwithstanding
anything to the contrary, the pro-
23 ceeds of bonds authorized under this act
are to be deposited to the fund
24 and earnings on balances of bond proceeds
in the fund are to be deposited
25 to the transportation capital enhancement
bond debt service fund which
26 is hereby created.
27 (b) Additionally
the secretary for the purpose of making loans may
28 issue revenue bonds or enter into
agreements with the KDFA to issue
29 revenue bonds payable solely from
revenues accruing to the fund.
30 (c) The
activities of the secretary in administering and performing
31 the powers, duties and functions prescribed
by the provisions of the act
32 from the proceeds of bonds issued for such
purpose by the KDFA are
33 hereby approved for the purposes of
subsection (b) of K.S.A. 74-8905
34 and amendments thereto and the
authorization of the issuance of such
35 bonds in accordance with that statute. The
provisions of subsection (a) of
36 K.S.A. 74-8905 and amendments thereto shall
not prohibit the issuance
37 of bonds for such purposes when so
authorized and any such issuance of
38 bonds is exempt from the provisions of
subsection (a) of K.S.A. 74-8905
39 and amendments thereto.
40 New Sec. 11. (a)
Issuance of bonds shall be authorized for
purposes
41 of the bond pool provided for by this
act by resolution of the secretary.
42 The secretary shall determine the form and
manner of the execution of
43 bonds and such bonds may be made
exchangeable for bonds of another
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11
1 denomination or in another form. The
bonds shall be dated and shall
2 mature not later than 20 years from
their date. The bonds may be in such
3 form and denominations, may bear
interest payable at such times and at
4 such rate or rates, may be payable at
such places within or without the
5 state of Kansas, may be subject to
such terms of redemption in advance
6 of maturity at such prices, and may
contain such terms and conditions,
7 all as the secretary determines. The
bonds shall have all the qualities of
8 and shall be deemed to be negotiable
instruments under the laws of the
9 state of Kansas. The authorizing
resolution may contain such other terms,
10 covenants and conditions that the secretary
deems reasonable and desir-
11 able.
12 (b) The proceeds from
the sale of the bonds issued by the secretary
13 under this act are deemed to be trust funds
which shall be deposited in
14 the custody of the state treasurer in the
fund in the state treasury. The
15 secretary shall have responsibility for the
management and control of the
16 fund and shall provide, by resolution, for
both amounts and the duration
17 of investments of moneys in such fund. Such
resolution may recommend
18 investment and reporting policies,
including acceptable levels of return,
19 risk and security. After consultation with
the secretary and subject to the
20 terms, covenants and conditions provided in
the resolutions providing for
21 the issuance of such bonds, the pooled
money investment board shall
22 have the authority to invest and reinvest
moneys in such fund and to
23 acquire, retain, manage, including the
exercise of any voting rights, and
24 dispose of investments of such fund. In
investing or reinvesting moneys
25 in such fund, there shall be exercised the
judgment and care under the
26 circumstances then prevailing which persons
of prudence, discretion and
27 intelligence exercise in the management of
their own affairs, not in regard
28 to speculation but in regard to the
permanent disposition of their funds,
29 considering the probable income as well as
the probable safety of their
30 capital, except that moneys of the fund may
not be invested in common
31 stocks. Notwithstanding anything to the
contrary, all interest or other
32 income on the investments, after payment of
any management fees, of
33 the fund shall be credited to the
transportation capital enhancement
34 bond debt service fund, until
payments on bonds authorized by this act
35 and interest thereon has been fully funded.
Thereafter, earnings and
36 other income shall be credited to the
transportation capital enhancement
37 fund.
38 (c) The authorizing
resolution may provide for the execution of a trust
39 indenture. The trust indenture may contain
such terms, covenants and
40 conditions as are deemed desirable by the
secretary, including those per-
41 taining to the maintenance of various funds
and reserves, the nature and
42 extent of any security for payment of the
bonds, the custody and appli-
43 cation of the proceeds of the bonds, the
collection and disposition of bond
SB 648--Am. by SCW
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1 proceeds and earnings thereon, the
investing for authorized purposes,
2 and the rights, duties and
obligations of the secretary and the holders and
3 registered owners of the bonds.
4 (d) Any
authorizing resolution and trust indenture relating to the is-
5 suance and security of the bonds may
set forth covenants, agreements
6 and obligations therein, which may be
enforced by mandamus or other
7 appropriate proceeding at law or in
equity.
8 (e) The bonds may
be issued under the provisions of this act without
9 obtaining the consent of any
department, division, commission, board,
10 bureau or agency of the state and without
any other proceedings or the
11 happening of any other conditions or things
than those proceedings, con-
12 ditions or things which are specifically
required by this act.
13 New Sec. 12. (a)
All bonds authorized to be issued by the secretary
14 under this act may be sold upon such terms,
as the secretary shall deter-
15 mine to be reasonable and expedient for
effectuating the purposes of this
16 act. The bonds may be sold at such price as
the secretary may accept,
17 including sale at discount.
18 (b) The bonds, except
when issued as book-entry-only, shall be exe-
19 cuted by manual or facsimile signature of
the secretary. In case any of-
20 ficers whose signatures appear on the bonds
or coupons shall cease to be
21 such officers before delivery of such bonds
or coupons, their signatures,
22 nevertheless, shall be valid and sufficient
for all purposes. The secretary
23 shall adopt and use a seal in the execution
and issuance of the bonds, and
24 each bond shall be impressed or imprinted
with the seal of the secretary.
25 (c) Bonds issued under
the provisions of this act shall not be deemed
26 to constitute an indebtedness of the state
of Kansas or an indebtedness
27 for which the faith and credit or taxing
powers of the state of Kansas are
28 pledged. It shall be plainly stated on the
face of each bond, except when
29 issued as book-entry-only, that it has been
issued under this act, that the
30 bonds shall be obligations only of the
state highway fund, and that, in no
31 event, shall the bonds constitute an
indebtedness of the state of Kansas
32 or an indebtedness for which the faith and
credit or taxing powers of the
33 state of Kansas are pledged.
34 New Sec. 13. The
secretary may use the proceeds of any bonds au-
35 thorized by this act, together with any
other available funds, for activities
36 of the fund as provided in this act and for
paying expenses of authorizing
37 and issuing the bonds, for paying the
interest on the bonds until revenues
38 therefore are available in sufficient
amounts to pay such interest, for pur-
39 chasing bond insurance and other credit
enhancements on the bonds, and
40 for funding such reserves as the secretary
deems necessary and desirable.
41 New Sec. 14. There
is hereby established in the state treasury the
42 transportation capital enhancement bond
debt service fund. Moneys in
43 the transportation capital enhancement bond
debt service fund may be
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1 invested in the same manner as
prescribed in section 11. The secretary,
2 in the manner prescribed by law, may
transfer from the transportation
3 capital enhancement fund to the
transportation capital enhancement
4 bond debt service fund, upon duly
executed order or voucher of the
5 secretary to the state director of
accounts and reports, such amounts as
6 shall be required for paying the
interest on all bonds and refunding bonds
7 issued by the secretary under this
act; for retiring such bonds by their
8 maturity or maturities; for creating
reserves for such purposes; for paying
9 the premium, if any, on a specified
aggregate principal amount of such
10 bonds or refunding bonds which would be
payable in such year if such
11 principal amount of bonds or refunding
bonds were to be redeemed prior
12 to their maturity or maturities; for doing
any of the acts authorized in this
13 act; and for paying any administrative or
other expenses incurred in car-
14 rying out the powers granted by this act.
The transfers to be made in any
15 year pursuant to the provisions of this
section from the state highway
16 fund shall be a lien and claim on the state
highway fund. When the prin-
17 cipal, redemption premium, if any, and
interest on any and all bonds
18 issued pursuant to this act have either
been paid or the lien of such bonds
19 shall have been defeased in accordance with
their terms so that such
20 bonds are deemed to have been paid, then
any and all moneys held in
21 the transportation capital enhancement bond
debt service fund may be
22 transferred by the secretary to the
transportation capital enhancement
23 fund. The secretary may, in the manner
prescribed by law, expend from
24 the transportation capital enhancement bond
debt service fund, upon
25 duly executed order or voucher of the
secretary to the state director of
26 accounts and reports, such amounts as shall
be required for the payment
27 of principal, premium, if any, and interest
on bonds issued pursuant to
28 this act.
29 New Sec. 15. The
exercise of the powers granted by this act will be
30 in all respects for the benefit of the
people of the state, for the increase
31 of their commerce and prosperity and for
the improvement of their health
32 and living conditions; and as construction,
improvement, replacement and
33 maintenance of highway projects in the
state will constitute the perform-
34 ance of essential governmental functions,
all bonds and other debt in-
35 struments issued pursuant to the provisions
of this act, and all income or
36 interest therefrom, at all times shall be
exempt from all taxes within the
37 state of Kansas.
38 New
Sec. 16. Subject to the provisions of subsection (b) of
K.S.A.
39 68-2321 and amendments thereto, the
secretary may create and establish
40 one or more special accounts as appropriate
to secure bonds issued under
41 this act, as determined by the
secretary.
42 New Sec. 17. The
secretary may issue bonds under this act, for the
43 purpose of refunding, either at maturity or
in advance of maturity of
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14
1 bonds previously issued under this
act by the secretary. Such refunding
2 bonds may either be sold or delivered
in exchange for the bonds being
3 refunded. If sold, the proceeds may
either be applied to the payment of
4 the bonds being refunded or deposited
in trust and there maintained in
5 cash or invested for the retirement
of the bonds being refunded, as shall
6 be specified by the secretary and the
authorizing resolution or trust in-
7 denture securing such refunding
bonds. The authorizing resolution or
8 trust indenture securing the
refunding bonds may provide that the re-
9 funding bonds shall have the same
security for their payment as provided
10 for the bonds being refunded. Refunding
bonds shall be sold and secured
11 in accordance with the provisions of this
act pertaining to the sale and
12 security of the bonds. Any bonds that have
been issued pursuant to this
13 section shall not be counted against the
limit on the aggregate principal
14 amount of bonds established under section
10 and amendments thereto.
15 New
Sec. 18. (a) This act shall be liberally
construed. Nothing con-
16 tained herein shall be construed as a
restriction or limitation upon any
17 powers which the secretary might otherwise
have under any other law of
18 this state, and the provisions of the
foregoing are cumulative to such
19 powers. The foregoing provisions shall be
construed to provide a com-
20 plete, additional and alternative method
for the doing of the things au-
21 thorized and shall be regarded as
supplemental and additional to powers
22 conferred by any other laws. The issuance
of bonds under the provisions
23 hereof and the investment of proceeds
therefrom need not comply with
24 the requirements of any other state laws
applicable to the issuance of
25 bonds, notes and other obligations.
26 (b) Except as otherwise
provided in this subsection, nothing in
27 this act shall be construed to
authorize any project or qualified
28 project which would constitute an
internal improvement under item
29 (4) of section 9 of article 11 of the
Kansas constitution. Any such
30 project shall be authorized only in
accordance with the provisions
31 of item (4) of section 9 of article
11 of the Kansas constitution.
32 New Sec. 19. The
bonds issued by the secretary under the provisions
33 of this act are hereby made securities in
which all public officers and
34 public bodies of the state and its
political subdivisions, all insurance com-
35 panies, trust companies, banking
associations, investment companies, sav-
36 ings and loan associations, executors,
administrators, trustees and other
37 fiduciaries may properly and legally invest
funds, including capital in their
38 control or belonging to them. Such bonds
are hereby made securities
39 which may properly and legally be deposited
with and received by any
40 state or municipal officer or any agency or
political subdivision of the
41 state for any purpose for which the deposit
of bonds or other obligations
42 of the state is now or may be hereafter
authorized by law.
43 New Sec. 20. (a)
This act constitutes full and complete authority for
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15
1 the purposes set out in this act, and
no procedure or proceedings other
2 than those required by this act shall
be necessary for the performance of
3 the provisions thereof. The powers
conferred by this act shall be in ad-
4 dition and supplemental to and not in
substitution for, and the limitations
5 imposed by this act shall not affect,
the powers conferred on the secretary
6 by any other law.
7 (b) The provisions
of this act are severable, and if any provision, sec-
8 tion, subsection, sentence, clause or
phrase of this act, including, but not
9 limited to, the provisions relating
to any of the sources of revenues for
10 payment of bonds authorized pursuant to
this act are for any reason held
11 to be unconstitutional or otherwise invalid
by any court of competent
12 jurisdiction, such decision shall not
affect the validity of the remaining
13 portions of this act. The legislature
hereby declares that it would have
14 passed this act and each provision,
section, subsection, sentence, clause
15 or phrase thereof irrespective of the fact
that any one or more of the same
16 are declared invalid.
17 New Sec. 21. The
program shall continue until terminated by law,
18 except, that no such law shall take effect
so long as there shall be out-
19 standing any bonds secured by the fund
unless adequate provision has
20 been made for the payment or satisfaction
thereof. Upon termination of
21 the program, the title to the fund and any
amounts remaining therein and
22 all other program assets which remain after
provision for the payment or
23 satisfaction of all bonds issued pursuant
to this act shall vest in the state
24 highway fund.
25 Sec. 22. K.S.A.
68-2315 is hereby repealed.
26 Sec. 23. This act
shall take effect and be in force from and after its
27 publication in the statute book.
28