(a)General obligation debt. General obligation debt may not be incurred until the General Assembly has enacted legislation stating the purposes, in general or specific terms, for which such issue of debt is to be incurred, specifying the maximum principal amount of the issue, and appropriating an amount at least sufficient to pay the highest annual debt service requirements for the issue. Appropriations made in each fiscal year, as provided in this subsection, for debt service purposes shall not lapse for any reason and shall continue in effect until the debt for which such appropriation was authorized shall have been incurred; but the General Assembly may repeal any such appropriation at any time prior to the incurring of such debt. Following the incurring of debt in any fiscal year for
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(a) General obligation debt. General obligation debt may not be incurred until the General Assembly has enacted legislation stating the purposes, in general or specific terms, for which such issue of debt is to be incurred, specifying the maximum principal amount of the issue, and appropriating an amount at least sufficient to pay the highest annual debt service requirements for the issue. Appropriations made in each fiscal year, as provided in this subsection, for debt service purposes shall not lapse for any reason and shall continue in effect until the debt for which such appropriation was authorized shall have been incurred; but the General Assembly may repeal any such appropriation at any time prior to the incurring of such debt. Following the incurring of debt in any fiscal year for any purpose for which an appropriation has been made, there shall be deposited in the sinking fund provided for in paragraph (1) of this subsection an amount equal to the highest annual debt service requirements for such debt coming due in any succeeding fiscal year. On or prior to the end of such fiscal year, the commission shall certify to the fiscal officer of the state the amount of the appropriation for any purpose which has been transferred to the sinking fund and the amount of the anticipated highest annual debt service requirement of debt authorized to be issued in such fiscal year for any purpose by resolution of the commission but which actually will be incurred in the next succeeding fiscal year. The remaining appropriation for any purpose, after deducting the aggregate amounts described in the preceding sentence, shall lapse, except that any such amount attributable to an appropriation to general obligation debt for the construction and improvement of public roads and bridges shall not lapse but shall be paid to the Department of Transportation. The General Assembly may provide in an appropriation of highest annual debt service requirements that if the commission determines not to incur the debt so authorized, the commission may expend the appropriation as capital outlay for the purposes specified in the appropriation. The appropriation as capital outlay shall lapse at the end of the fiscal year of the appropriation unless committed as provided by law. The appropriation as highest annual debt service shall expire as authorization for debt when the funds are committed as capital outlay but shall otherwise lapse as provided by law. (1) Sinking fund. The General Assembly shall appropriate to a special trust fund designated "State of Georgia General Obligation Debt Sinking Fund" such amounts as are necessary to pay annual debt service requirements on all general obligation debt incurred hereunder. The sinking fund shall be used solely for retirement of general obligation debt payable therefrom. (2) Failure to appropriate; insufficient moneys in sinking fund. If the General Assembly shall fail to make any appropriation or if for any reason the moneys in the sinking fund are insufficient to make all payments required with respect to such general obligation debt as and when the same becomes due, the state treasurer shall set apart from the first revenues thereafter received, applicable to the general fund of the state, such amounts as are necessary to cure any such deficiencies and shall immediately deposit the same into the sinking fund. The state treasurer may be required to set aside and apply such revenues as aforesaid at the action of any holder of any general obligation debt incurred under this article. The obligation to make such sinking fund deposits shall be subordinate to the obligation imposed upon the fiscal officers of the state pursuant to the second paragraph of Article IX, Section VI, Paragraph I(a) of the Constitution of Georgia of 1976. (3) Sinking fund investments. The moneys in the sinking fund shall be as fully invested as practical, consistent with the requirements to make current principal and interest payments. Any such investments shall be restricted to obligations constituting direct and general obligations of the United States government or obligations unconditionally guaranteed as to the payment of principal and interest by the United States government, maturing no longer than 12 months from date of purchase. (4) Highway appropriations. Appropriations to the sinking fund for debt service requirements attributable to public debt incurred or to be incurred for construction, reconstruction, and improvement of public roads and bridges shall be considered as an appropriation for activities incident to providing and maintaining an adequate system of public roads and bridges in this state for the purpose of Article III, Section IX, Paragraph VI(b) of the Constitution. (b) Guaranteed revenue debt. Guaranteed revenue debt may not be incurred until the General Assembly has enacted legislation authorizing the guarantee of the specific issue of revenue obligations then proposed, reciting that the General Assembly has determined such obligations will be self-liquidating over the life of the issue, which determination shall be conclusive, specifying the maximum principal amount of such issue, and appropriating an amount at least equal to the highest annual debt service requirements for such issue. After the General Assembly has enacted legislation authorizing the guarantee of a specific issue of revenue bonds by an instrumentality of the state or state authority, the commission shall approve the issuance of such bonds and thereafter such instrumentality or state authority shall actually authorize the issuance of its revenue bonds in accordance with the Act of the General Assembly, including amendments thereto, authorizing the issuance of revenue bonds by such instrumentality or state authority and the applicable provisions of this article. (1) Common reserve fund. Appropriations made in connection with guaranteed revenue debt shall be paid, upon the issuance of the obligations, into a special trust fund to be designated "State of Georgia Guaranteed Revenue Debt Common Reserve Fund" to be held together with all other sums similarly appropriated as a common reserve for any payments which may be required by virtue of any guarantee entered into in connection with any issue of guaranteed revenue obligations. This Guaranteed Revenue Debt Common Reserve Fund shall be held and administered by the state treasurer. All such appropriations for the benefit of guaranteed revenue debt shall not lapse for any reason and shall continue in effect until the debt for which the appropriation was authorized shall have been incurred; but the General Assembly may repeal any such appropriation at any time prior to the payment of the same into the common reserve fund. (2) Insufficient moneys in common reserve fund. If any payments are required to be made from the State of Georgia Guaranteed Revenue Debt Common Reserve Fund to meet debt service requirements on guaranteed revenue obligations by virtue of an insufficiency of revenues, the state treasurer shall pay to the designated paying agent, upon certification by the issuing instrumentality as to the insufficiency of such revenues, from the common reserve fund, the amount necessary to cure such deficiency. The state treasurer shall then reimburse such fund from the general funds of the state within ten days following the commencement of any fiscal year of the state for any amounts so paid. The state treasurer may be required to apply such funds as aforesaid with respect to guaranteed revenue debt at the action of any holder of any such guaranteed revenue obligations. The obligation to make any such reimbursements shall be subordinate to the obligation imposed upon the fiscal officers of the state pursuant to the second paragraph of Article IX, Section VI, Paragraph I(a) of the Constitution of Georgia of 1976 and shall also be subordinate to the obligation hereinabove imposed upon the state treasurer to make sinking funds deposits for the benefit of general obligation debt. (3) Minimum balance required; excess moneys; investments. The amount to the credit of the common reserve fund shall at all times be at least equal to the aggregate highest annual debt service requirements on all outstanding guaranteed revenue obligations entitled to the benefit of such fund. If at the end of any fiscal year of the state the fund is in excess of the required amount, the state treasurer, upon certification of the state accounting officer, shall transfer such excess to the general funds of the state, free of such trust. The funds in the common reserve shall be as fully invested as is practical, consistent with the requirements of guaranteeing the principal and interest payments on the revenue obligations guaranteed by the state. Any such investments shall be restricted to obligations constituting direct and general obligations of the United States government or obligations unconditionally guaranteed as to the payment of principal and interest by the United States government, maturing no longer than 12 months from the date of purchase. (c) Requirement for taxation. The General Assembly shall raise by taxation each fiscal year, in addition to the sums necessary to make all payments required to be made under contracts entitled to the protection of the second paragraph of Article IX, Section VI, Paragraph I(a) of the Constitution of Georgia of 1976 and to pay public expenses, such amounts as are necessary to pay debt service requirements in such fiscal year on all general obligation debt incurred hereunder and to maintain at all times the Guaranteed Revenue Debt Common Reserve Fund in the full amount required by the Constitution and this article. (d) Variable rate debt. (1) As used in this subsection, the term "variable rate debt" means general obligation debt bearing interest at a variable interest rate. (2) Variable rate debt may be incurred in the following manner: (A) For purposes of calculating the highest annual debt service requirements for variable rate debt, interest may be calculated at the maximum rate of interest that may be payable during any one fiscal year, after taking into account any credits permitted in the related bond resolution, indenture, or other instrument against such amount; (B) Any resolution authorizing general obligation debt which is variable rate debt, in lieu of stating the rate or rates at which such variable rate debt shall bear interest and the price or prices at which such variable rate bonds shall be initially sold or remarketed, in the event of purchase and subsequent resale, may provide that such interest rates and prices may vary from time to time depending on criteria established in the approving resolution, which criteria may include, without limitation, references to indices or variations in interest rates as may, in the judgment of a remarketing agent, be necessary to cause variable rate debt to be remarketable from time to time at a price equal to its principal amount and may provide for the appointment of a bank, trust company, investment bank, or other financial institution to serve as remarketing agent for such purposes. The resolution for any variable rate debt may provide that alternate interest rates or provisions for establishing alternate interest rates, different security or claim priorities, or different call or amortization provisions will apply during such times as the variable rate debts are held by a person providing credit or liquidity enhancement arrangements for such debt as authorized in subparagraph (C) of this paragraph. The resolution may also provide for such variable rate debt to bear interest at rates established pursuant to a process generally known as an auction rate process and may provide for appointment of one or more financial institutions or investment banks to serve as auction agents and broker-dealers in connection with the establishment of such interest rates and sale and remarketing of such debt; (C) In connection with the issuance of any variable rate debt, the state may enter into arrangements to provide additional security and liquidity for such debt, including without limitation, bond or interest rate insurance or letters of credit, bond purchase contracts, or other arrangements whereby funds are available to retire or purchase such variable rate debt, thereby assuring the ability of owners of the variable rate debt to sell or redeem such debt. The state may enter into contracts and may agree to pay fees to persons providing such arrangements, but only under circumstances where the appropriate officer has certified that he or she reasonably expects that the total interest paid or to be paid on the variable rate debt, together with the fees for the arrangements, being treated as if interest, would not, taken together, cause the debt to bear interest, calculated to its stated maturity, at a rate in excess of the rate that the debt would bear in the absence of such arrangements; and (D) The state may enter into qualified interest rate management agreements with respect to any variable rate debt. Net payments for such qualified interest rate management agreements shall constitute interest on the variable rate debt and shall be paid from the same source as payments on the variable rate debt. During the term of any qualified interest rate management agreement, annual debt service requirements of the variable rate debt may be calculated taking into account any amounts to be paid or received pursuant to the terms of such qualified interest rate management agreement.