SB385 Alabama 2017 Session

Under existing law, the Alabama Transportation Infrastructure Bank was established pursuant to Act 2015-50. Various sources of funding were authorized to capitalize the bank including revenue from one cent of the gasoline tax and a portion of the revenue from the license and registration fees on trucks and truck tractors. The bank is authorized to make loans to units of government to construct, operate, or own transportation projects. The bank is authorized to raise funds for qualified projects by the issuance of bonds. At the current time, funding has not been made available to capitalize the bank

This bill would further provide for the Alabama Transportation Infrastructure Bank. The bill authorizes additional tax revenue to be pledged to pay and secure revenue bonds issued by the bank as determined by the Director of Transportation and approved by the Governor, including certain taxes on motor vehicle licenses and registration, certain taxes on diesel fuel and gasoline, and certain fees on identification markers. These taxes and fees and the prior taxes and fees authorized to capitalize the bank would be irrevocably appropriated to capitalize the bank and pay the debt service on bonds as determined by the director and approved by the Governor. Under certain conditions, pledges of the revenue would be subordinate to the pledges of the revenue by the Alabama Federal Aid Highway Finance Authority and the Alabama Highway Finance Corporation

The bill would otherwise provide for the operation of the bank, including the following: (1) Provide for the definitions of government unit, qualified project, and qualified borrower; (2) Specify that a borrower may pledge any revenue and, if authorized, its full faith and credit for obligations of the bank; (3) Authorize audits by the Department of Examiners of Public Accounts in addition to independent auditors; (4) Authorize bonds of the bank to be secured by other forms of credit instruments; (5) Clarify the bonds would not be a debt of the state; (6) Delete the requirement that bonds be issued by the State Treasurer; (7) Specify that any pledge to secure bonds applies to a pledge to secure other financial assistance

The bill would also add provisions relating to the granting of other financial assistance and the execution of other financial instruments, specify that the bank would be a nonprofit corporation, and provide for the dissolution of the bank

Relating to the Alabama Transportation Infrastructure Bank; to amend Sections 23-7-2, 23-7-6, 23-7-7, 23-7-9, 23-7-15, 23-7-17, 23-7-18, 23-7-19, 23-7-20, and 23-7-21, Code of Alabama 1975, and to add Sections 23-7-29, 23-7-30 and 23-7-31 to the Code of Alabama 1975, to further provide for the definitions of government unit, qualified borrower, and qualified project; to provide further for the exercise of the powers of the bank; to provide for the appropriation and pledge of certain gasoline tax revenues, motor vehicle license taxes and registration fees, diesel fuel tax revenues, motor carrier tax revenues, and identification marker fees to capitalize the bank and for the bank to carry out its purposes; to provide for the administration of the bank; to provide that a pledge of the revenues of the bank to secure its bonds or other financial assistance would continue until such obligations have been paid or terminated unless the instrument providing the pledge provides otherwise; to provide that under certain conditions pledges of revenues would be subordinate to the pledges of the revenues by the Alabama Federal Aid Highway Finance Authority and the Alabama Highway Finance Corporation; to provide for the priority of pledges by the bank; to provide for the irrevocable appropriation to the bank the taxes and fees as recommended by the Director of the Department of Transportation and approved by the Governor for the purpose of providing funds to capitalize the bank and for the bank to carry out its purposes including the pledging for the payment of debt service on bonds; to provide further that a government unit may pledge additional types of tax revenues and, if authorized, its full faith and credit to secure its obligations to the bank; to provide further that an audit of the books of the bank may be performed by the Department of Examiners of Public Accounts; to provide further that bonds issued by the bank may be secured by other financial assistance provided by the bank as well as by bond insurance, guarantees, letters of credit or other forms of credit enhancement purchased or otherwise obtained by the bank from any public or private entity; to provide further that bonds and other financial assistance issued by the bank shall not constitute an obligation or debt of the state or any of its political subdivisions, but shall be limited obligations of the bank payable solely from the revenue, money, or property of the bank pledged for the purpose of the instruments; to provide further that neither the full faith and credit nor the taxing power of the state, or any of its political subdivisions is pledged for payment of bonds or other financial assistance of the bank; to remove the requirement that the bank's bonds be issued by the State Treasurer and that a trustee for the bank's bonds would be designated by the State Treasurer; to provide that bonds of the bank may be secured by a pledge of specific revenues and assets; to provide further that any pledge to secure the bank's bonds or other financial assistance is valid and binding from the time it is made and that no recording or filing is necessary to create or perfect any such pledge or security interest; to provide further for the provision of other financial assistance; to provide that the net earnings of the bank shall not inure to the benefit of any individual, firm, or corporation; and to provide for the dissolution of the bank.