2013 -- H 5313

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LC00923

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO PUBLIC FINANCE - PUBLIC CORPORATION DEBT MANAGEMENT

     Introduced By: Representatives Costantino, Baldelli-Hunt, Winfield, Hull, and Ucci

     Date Introduced: February 07, 2013

     Referred To: House Finance

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 35-18-4 of the General Laws in Chapter 35-18 entitled "Public

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Corporation Debt Management" is hereby amended to read as follows:

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     35-18-4. Procedure. -- (a) A financing lease, guarantee, bond, or other obligation shall

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be deemed to have been approved by the general assembly when the general assembly passes a

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concurrent resolution of approval regarding the financing lease, guarantee, bond, or other

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obligation which the governor or a public corporation, as the case may be, requests that the

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financing lease, guarantee, bond, or other obligation be approved by the general assembly. These

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requests shall be transmitted to the speaker of the house and the president of the senate with

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copies to the chairpersons of the respective finance committees and fiscal advisors. The request

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for approval shall include:

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      (1) A full description of the essential public facility to which the financing lease,

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guarantee, bond, or other obligation is related;

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      (2) An explanation as to why the facility is needed and how it will be paid off; and

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      (3) The maximum possible obligation of the state or of any public corporation under the

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financing lease, guarantee, bond, or other obligation.

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      (b) The governor shall provide the general assembly with a timely explanation of any

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certification made by him or her pursuant to this chapter in connection with any financing lease,

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guarantee, bond, or other obligation. These explanations shall be transmitted to the speaker of the

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house and the president of the senate with copies to the chairpersons of the respective finance

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committees and fiscal advisors. The explanation shall also include:

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      (1) A full description of the essential public facility to which the financing lease,

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guarantee, bond, or other obligation is related;

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      (2) An explanation as to why the facility is needed and how it will be paid off; and

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      (3) The maximum possible obligation of the state or of any public corporation under the

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financing lease, guarantee, bond, or other obligation.

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      (c) The state shall not enter into any financing lease or guarantee relating to, nor shall

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any public corporation issue any bond or other obligation in connection with, any essential public

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facility unless the facility conforms to the description included in the request for approval or in

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the explanation for certification submitted by the governor in connection with the financing lease,

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guarantee, bond, or other obligation; nor shall the state's obligation in connection with the

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financing lease, guarantee, bond, or other obligation exceed the amount set forth in the request for

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approval or explanation of certification.

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      (d) Immediately following the first sale of each issue of bonds in connection with the

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financing of an economic development project, the governor shall provide the general assembly

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with copies of any offering statement for those bonds and his or her analysis of the benefits and

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risks to the state of the project. These statements and analyses shall be transmitted to the speaker

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of the house and the president of the senate, with copies to the chairpersons of the respective

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finance committees and fiscal advisors.

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     (e) Effective June 1, 2013, and notwithstanding any provisions of the general and/or other

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public laws to the contrary, in regard to any programs of the Rhode Island economic development

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corporation wherein the corporation seeks or proposes to guarantee annual debt service or issue

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bonds of the corporation, including, but not limited to, actions with respect to the job creation

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guaranty program and/or any successor or similar program, the corporation shall consider

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proposals and projects in amounts as low as twenty-five thousand dollars ($25,000). The

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executive director of the corporation shall promulgate rules and regulations to set forth the

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application procedures for such proposals. In establishing these rules and regulations, the

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executive director and the corporation shall be guided by the principle that it is the intent of the

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general assembly for the corporation to promote development among and reach out to smaller

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entities and enterprises that have traditionally been assisted by the corporation. It is also the intent

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of the general assembly that the rules and regulations give strong consideration to small entities

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and enterprises which have a history of moderate growth and success in Rhode Island and which

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seek expansion in Rhode Island. The provisions of this subsection and any regulations thereunder

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shall be in addition to any other applications or approval required from the general assembly

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pursuant to this chapter.

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     SECTION 2. This act shall take effect upon passage.

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LC00923

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO PUBLIC FINANCE - PUBLIC CORPORATION DEBT MANAGEMENT

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     This act would direct the Rhode Island economic development corporation to consider

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proposals and requests for loans in amounts as low as twenty-five thousand dollars ($25,000), and

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for the corporation's executive director to develop rules and regulations to facilitate such requests.

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     This act would take effect upon passage.

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LC00923

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