§ 39:462.4 — Revolving loan fund; eligibility requirements; loans for eligible infrastructure

Louisiana § 39:462.4

• Jurisdiction: Louisiana
• Title 39: Procurement and Contract

Text

§462.4. Revolving loan fund; eligibility requirements; loans for eligible infrastructure
projects; authorizing and issuing debt; security; interest rates; tax exemption
A.(1) Notwithstanding any provision of law to the contrary, and in addition to the
authority to lend or borrow money or incur or guarantee indebtedness provided by any other
provision of law, sums on deposit in and credited to the fund may be loaned to local
governments for use in connection with eligible infrastructure projects. However, this
Section shall not be deemed to be the exclusive authority under which a local government
may borrow money or incur indebtedness.
(2) In order for a local government to be eligible for a loan pursuant to the provisions
of this Chapter, the local government shall comply with all of the following:
(a) The local government shall demonstrate that it has financial resources and a
financial strategy for the duration of the lifecycle of the project to ensure that the project is
sufficiently funded, maintained, and replaced as needed.
(b) The local government shall be in good standing and comply with the audit
requirements provided for in R.S. 24:513 at the time that the local government applies for
and receives the loan as well as during the duration of the term of the loan.
(3) A local government is limited to one loan from the revolving loan fund; however,
once all of the principal, interest, and any other fees and obligations due under the loan
agreement are paid in full, the local government may apply for a new loan from the revolving
loan fund.
(4) No loan shall be made nor debt evidencing the loan be issued or incurred without
the approval of the commission.
B. All bonds, notes, or other evidences of indebtedness of any local government
issued to represent a loan shall be authorized and issued pursuant to a resolution or ordinance
of the governing authority of that entity, hereinafter referred to collectively as "resolution".
The resolution shall prescribe the form and details thereof, including the terms, security for,
manner of execution, repayment schedule, and redemption features thereof, and the
resolution may provide that an officer of the entity may execute in connection with the
obligation any related contract, including but not limited to a credit enhancement device,
indenture of trust, loan agreement, pledge agreement, or other agreement or contract needed
to accomplish the purposes for which the evidence of indebtedness is given, in substantially
the form referenced in the resolution, but which final executed credit enhancement device,
indenture of trust, loan agreement, pledge agreement, or other contract or agreement may
contain changes, additions, and deletions as shall in the sole opinion of the executing officer
be appropriate under the circumstances. The resolution shall include a statement as to the
maximum principal amount of any obligation; the maximum interest rate to be incurred or
borne by the obligation or guaranteed by the obligation; the maximum redemption premium,
if any; and the maximum term in years for the obligation, guarantee, or pledge.
C. Notwithstanding any other provision of law to the contrary, a local government,
upon entering into a loan as provided in this Chapter, may dedicate and pledge a portion of
any revenues it has available to be pledged and dedicated, including but not limited to
revenues from the general revenue fund, sales taxes, sewer user fees, assessments, parcel
fees, or ad valorem property taxes, for a sufficient term to repay the principal of, interest on,
and any premium, administrative fee, or other fee or cost incurred in connection with the
loan.
D. Any evidence of indebtedness authorized pursuant to this Chapter shall bear a rate
or rates of interest that shall not exceed the rate or rates set forth in the resolution authorizing
and providing for the issuance thereof. Any rate or rates of interest may be fixed, variable,
or adjustable rates.
E. The general laws of the state governing fully registered securities of public entities
shall be applicable to the bonds, notes, or other evidences of indebtedness issued pursuant
to this Chapter.
F. A resolution authorizing a loan pursuant to this Section shall be published once
in the official journal or a newspaper of general circulation in the parish or local government
entity incurring the loan. It shall not be necessary to publish exhibits to the resolution, but
the exhibits shall be made available for public inspection at the offices of the governing
authority of the parish, municipality, or other political subdivision at reasonable times, and
notice of the availability of these documents shall be stated in the publication within the
official journal or newspaper of general circulation in the parish or local government entity
incurring the loan. For a period of thirty days after the date of publication, any person in
interest may contest the legality of the resolution authorizing the evidence of indebtedness
or other loan and any provision thereof made for the security and payment of the debt. After
the thirty-day period, no one shall have any cause or right of action to contest the regularity,
formality, legality, or effectiveness of the resolution and the provisions thereof or of the
bonds, notes, or other evidences of indebtedness or other loan, or to provide for the payment
of the debt, or the legality thereof, and all of the provisions of the resolution and evidence
of indebtedness shall be conclusively presumed valid, and no court shall have authority or
jurisdiction to inquire into the matter.
G. Interest on bonds, notes, or other evidences of indebtedness issued for any loan
entered into under the authority of this Chapter shall be exempt from all state taxation
pursuant to the provisions of R.S. 39:511 and R.S. 47:48. The bonds, notes, or other
evidences of indebtedness or loans may be used for deposit with any officer, board,
municipality, or other political subdivision of the state in any case where, by present or future
laws, deposit of security is required for state funds. Additionally, the proceeds of bonds,
notes, or other evidences of indebtedness or loans issued pursuant to the provisions of this
Chapter may be used for costs associated with the issuance of bonds, notes, or other
evidences of indebtedness.

Legislative History

Acts 2023, No. 424, §1, eff. July 1, 2023.