Signed by Governor Jan Brewer

Vote Smart's Synopsis:

Vote to pass a bill that requires the Director of the Arizona Department of Administration (ADOA) to issue state lottery revenue bonds by December 31, 2010 and to enter into lease-purchase agreements through the sale and simultaneous lease-purchase of state buildings no later than September 30, 2010.

Highlights:

• -Specifies that the lottery bonds be sufficient to do the following (Sec. 1):
• Deposit $450 million in the state general fund;
• Pay bond-related expenses;
• Pay fees, charges, and expenses incurred with respect to bond related obligations; and
• Fully or partially fund any reserves or sinking accounts for debt service on the bonds establishes by the bond documents.

• Requires the director to authorize the bonds in a signed document describing the following (Sec. 1):
• The fixed or variable rate or rates of interest;
• The date or dates on which interest is payable;
• The denomination of the bonds;
• The date or dates of the bond and maturity, within 20 years of the date of issuance;
• The form of the bonds;
• The manner of executing the bonds;
• The medium and place of payment; and
• The terms of redemption, which may provide for a premium for early redemption.

• Requires that that the bonds be sold at public or private sale at the price and terms prescribed by the director at, above, or below par (Sec. 1).

• Establishes the Proceeds Fund, administered by the ADOA, and deposits any net proceeds over $450 million into the Proceeds Fund (Sec. 1).

• Prohibits the use of money in the Proceeds Fund from being used for anything other than bond-related expenses (Sec. 1).

• Exempts the monies in the Proceeds Fund from lapsing (Sec. 1).

• Establishes the Debt Service Fund under the direction of ADOA (Sec. 1).

• Transfers lottery funds currently deposited into the state general fund to the Debt Service Fund until the state meets all requirements of the bond document (Sec. 1).

• Requires that after payment of the lottery's operating expenses, amounts distributed to lottery beneficiaries are transferred to the Debt Service Fund until the state meets all requirements of the bond documents (Sec. 1).

• Authorizes the director to do the following (Sec. 1):
• Segregate the Debt Service Fund and provide that issued bonds may be secured by a lien on all or part of the money in the Debt Service Fund or any account of the fund;
• Provide that the bonds are secured by a first lien on the money paid into the Debt Service Fund and pledge all or part of the monies in the Debt Service Fund and Proceeds Fund to secure and pay the principal, interest and any premiums on the bonds as they come due;
• Establish priorities among bondholders based on criteria adopted by the director; -Set aside, regulate and dispose of reserves and sinking accounts;
• Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given;
• Provide for payment of bond-related expenses from the proceeds of the sale of the bonds or other revenues authorized by this article and available to the director;
• Provide for the services of trustees, co-trustees, agents and consultants and other specialized services with respect to the bonds;
• Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds;
• Refund any bonds issued by the director by issuing new bonds, if these bonds are secured from the same source of revenues as the bonds authorized by this article; and
• Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

• Requires the director, if bonds are issued, to provide the State Lottery Commission with a schedule of the amount needed to pay each fiscal year's debt service (Sec. 1).

• Provides for the purchase of Bonds for cancellation out of any monies available for purchase with restrictions (Sec. 1).

• Authorizes the director to authorize that state treasurer or bond trustee to invest money in the Debt Service Fund and the Proceeds Fund (Sec. 1).

• Exempts the bonds from state taxation (Sec. 1).

• Specifies that the bonds are not general, special or other obligations of this state and do not constitute state debt (Sec. 1).

• Requires that the lease-purchase agreement to do including, but not limited to, the following (Sec. 2):
• Result in net available proceeds of not more than $300 million to be deposited into the state general fund by September 30, 2010.
• Be for a fixed term of no more than 20 years; and -Make the initial lease-purchase payment in fiscal year 2011.

• Specifies that the obligation of the state to make any payment under the agreement is a current expense of the ADOA only payable from appropriated money and is not a general obligation indebtedness of the state or ADOA (Sec. 2).

• Specifies that if the Legislature fails to make an appropriation or ADOA fails to allocate money for any payment, the agreement terminates at the end of the current term and the state and ADOA are relieved of any subsequent obligation (Sec. 2).

• Requires the state to maintain operations at any facility that is sold, including prisons (Sec. 2).

• Specifies that the bill does not become law unless Senate Bill 1004 also becomes law (Sec. 3).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that requires the Director of the Arizona Department of Administration (ADOA) to issue state lottery revenue bonds by December 31, 2010 and to enter into lease-purchase agreements through the sale and simultaneous lease-purchase of state buildings no later than September 30, 2010.

Highlights:

• -Specifies that the lottery bonds be sufficient to do the following (Sec. 1):
• Deposit $450 million in the state general fund;
• Pay bond-related expenses;
• Pay fees, charges, and expenses incurred with respect to bond related obligations; and
• Fully or partially fund any reserves or sinking accounts for debt service on the bonds establishes by the bond documents.

• Requires the director to authorize the bonds in a signed document describing the following (Sec. 1):
• The fixed or variable rate or rates of interest;
• The date or dates on which interest is payable;
• The denomination of the bonds;
• The date or dates of the bond and maturity, within 20 years of the date of issuance;
• The form of the bonds;
• The manner of executing the bonds;
• The medium and place of payment; and
• The terms of redemption, which may provide for a premium for early redemption.

• Requires that that the bonds be sold at public or private sale at the price and terms prescribed by the director at, above, or below par (Sec. 1).

• Establishes the Proceeds Fund, administered by the ADOA, and deposits any net proceeds over $450 million into the Proceeds Fund (Sec. 1).

• Prohibits the use of money in the Proceeds Fund from being used for anything other than bond-related expenses (Sec. 1).

• Exempts the monies in the Proceeds Fund from lapsing (Sec. 1).

• Establishes the Debt Service Fund under the direction of ADOA (Sec. 1).

• Transfers lottery funds currently deposited into the state general fund to the Debt Service Fund until the state meets all requirements of the bond document (Sec. 1).

• Requires that after payment of the lottery's operating expenses, amounts distributed to lottery beneficiaries are transferred to the Debt Service Fund until the state meets all requirements of the bond documents (Sec. 1).

• Authorizes the director to do the following (Sec. 1):
• Segregate the Debt Service Fund and provide that issued bonds may be secured by a lien on all or part of the money in the Debt Service Fund or any account of the fund;
• Provide that the bonds are secured by a first lien on the money paid into the Debt Service Fund and pledge all or part of the monies in the Debt Service Fund and Proceeds Fund to secure and pay the principal, interest and any premiums on the bonds as they come due;
• Establish priorities among bondholders based on criteria adopted by the director; -Set aside, regulate and dispose of reserves and sinking accounts;
• Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given;
• Provide for payment of bond-related expenses from the proceeds of the sale of the bonds or other revenues authorized by this article and available to the director;
• Provide for the services of trustees, co-trustees, agents and consultants and other specialized services with respect to the bonds;
• Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds;
• Refund any bonds issued by the director by issuing new bonds, if these bonds are secured from the same source of revenues as the bonds authorized by this article; and
• Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

• Requires the director, if bonds are issued, to provide the State Lottery Commission with a schedule of the amount needed to pay each fiscal year's debt service (Sec. 1).

• Provides for the purchase of Bonds for cancellation out of any monies available for purchase with restrictions (Sec. 1).

• Authorizes the director to authorize that state treasurer or bond trustee to invest money in the Debt Service Fund and the Proceeds Fund (Sec. 1).

• Exempts the bonds from state taxation (Sec. 1).

• Specifies that the bonds are not general, special or other obligations of this state and do not constitute state debt (Sec. 1).

• Requires that the lease-purchase agreement to do including, but not limited to, the following (Sec. 2):
• Result in net available proceeds of not more than $300 million to be deposited into the state general fund by September 30, 2010.
• Be for a fixed term of no more than 20 years; and -Make the initial lease-purchase payment in fiscal year 2011.

• Specifies that the obligation of the state to make any payment under the agreement is a current expense of the ADOA only payable from appropriated money and is not a general obligation indebtedness of the state or ADOA (Sec. 2).

• Specifies that if the Legislature fails to make an appropriation or ADOA fails to allocate money for any payment, the agreement terminates at the end of the current term and the state and ADOA are relieved of any subsequent obligation (Sec. 2).

• Requires the state to maintain operations at any facility that is sold, including prisons (Sec. 2).

• Specifies that the bill does not become law unless Senate Bill 1004 also becomes law (Sec. 3).

Full Bill Text