3191_20101214 by wanghonghx

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 9                           A BILL
10
11   TO AMEND SECTION 41-43-90, AS AMENDED, CODE OF
12   LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE
13   POWERS OF THE JOBS-ECONOMIC DEVELOPMENT
14   AUTHORITY, SO AS TO FURTHER PROVIDE FOR THE
15   POWER OF THE AUTHORITY TO USE PROGRAM FUNDS
16   TO PURCHASE INSURANCE, THE BENEFITS OF WHICH
17   MUST BE USED TO FUND, DIRECTLY OR INDIRECTLY,
18   PROJECTS OR ACTIVITIES WHICH CREATE JOBS OR
19   PROVIDE OTHER SIGNIFICANT PUBLIC BENEFITS; TO
20   AMEND SECTION 41-43-110, AS AMENDED, RELATING TO
21   THE ISSUANCE OF BONDS BY THE AUTHORITY, SO AS
22   TO SPECIFY THAT THE AUTHORITY MAY ISSUE BONDS
23   TO FINANCE THE ACQUISITION BY CONSTRUCTION OR
24   PURCHASE OF TANGIBLE OR INTANGIBLE ASSETS; TO
25   AMEND SECTION 41-43-140, RELATING TO THE
26   CREATION OF AN INSURANCE FUND BY THE
27   AUTHORITY AS SECURITY FOR BOND HOLDERS, SO AS
28   TO FURTHER PROVIDE FOR THE CREATION OF THE
29   INSURANCE FUND AND THE USE OF FUNDS THEREIN; TO
30   AMEND SECTION 41-43-150, RELATING TO PERSONS AND
31   PROJECTS ELIGIBLE FOR ASSISTANCE FROM THE
32   AUTHORITY, SO AS TO FURTHER PROVIDE FOR PERSONS
33   AND PROJECTS ELIGIBLE FOR ASSISTANCE AND THE
34   CRITERIA THEREFOR; AND TO AMEND SECTION
35   41-43-160, AS AMENDED, RELATING TO LOAN
36   PROGRAMS OF THE AUTHORITY, SO AS TO PROVIDE
37   THE USE WHICH CAN BE MADE OF PROCEEDS OF LOANS
38   MADE UNDER THIS SECTION.
39
40   Be it enacted by the General Assembly of the State of South
41   Carolina:
42

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 1   SECTION 1. Section 41-43-90(L) of the 1976 Code is amended
 2   to read:
 3
 4     “(L) Use program funds:
 5        (1) to purchase or provide for insurance as additional
 6   security for any bonds issued by the authority; or
 7        (2) to purchase insurance, the benefits of which must be
 8   used to fund, directly or indirectly, projects or activities that create
 9   jobs or provide other significant public benefits.”
10
11   SECTION 2. Section 41-43-110(A) of the 1976 Code, as last
12   amended by Act 404 of 1992, is further amended to read:
13
14      “(A) The authority may issue bonds to provide funds for any
15   program authorized by this chapter, including without limitation
16   bonds issued to finance the acquisition by construction or purchase
17   of tangible or intangible assets. The bonds authorized by this
18   chapter are limited obligations of the authority. The principal and
19   interest are payable solely out of the revenues derived by the
20   authority. The bonds issued do not constitute an indebtedness of
21   the State or the authority within the meaning of any state
22   constitutional provision or statutory limitation. They are an
23   indebtedness payable solely from a revenue producing source or
24   from a special source which does not include revenues from any
25   tax or license. The bonds do not constitute nor give rise to a
26   pecuniary liability of the State or the authority or a charge against
27   the general credit of the authority or the State or taxing powers of
28   the State and this fact must be plainly stated on the face of each
29   bond. The bonds may be executed and delivered at any time as a
30   single issue or from time to time as several issues, may be in such
31   form and denominations, may be of such tenor, may be in coupon
32   or registered form, may be payable in such installments and at such
33   time, may be subject to terms of redemption, may be payable at
34   such place, may bear interest at such rate payable at such place and
35   evidenced in such manner, and may contain such provisions not
36   inconsistent herewith, all of which are provided in the resolution of
37   the authority authorizing the bonds. Subject to the State Budget
38   and Control Board approval, any bonds issued under this section
39   may be sold at public or private sale as may be determined to be
40   most advantageous. The bonds may be sold at public or private
41   sale and, if by private sale, the authority shall designate the
42   syndicate manager or managers. The authority may pay all
43   expenses, premiums, insurance premiums, and commissions which

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 1   it considers necessary from proceeds of the bonds or program
 2   funds in connection with the sale of bonds. The interest rate of
 3   bonds issued pursuant to this section is not subject to approval by
 4   the State Budget and Control Board.”
 5
 6   SECTION 3. Section 41-43-140 of the 1976 Code is amended to
 7   read:
 8
 9      “Section 41-43-140. The authority may create an insurance
10   fund pursuant to Section 41-43-90(L)(1), consisting solely of
11   program funds which must be held as security for the holders of
12   bonds issued under this act. Such funds shall must be held in the
13   custody of the State Treasurer, or with his approval may be held in
14   the custody of one or more commercial banks or trust companies
15   having a principal place of business in this State. The authority
16   also may use program funds to purchase insurance to be pledged
17   for the security of the holders of any bonds issued under this act or
18   for any other purpose authorized by law.
19      In any case in which insurance is pledged as security, whether
20   obtained through the insurance funds authorized to be created
21   under this section or purchased with program funds, it must
22   expressly must state the limitation of the liability of the authority
23   and further that neither the credit nor taxing power of the State or
24   any political subdivision thereof is available to satisfy any
25   obligations with respect thereto.”
26
27   SECTION 4. Section 41-43-150 of the 1976 Code is amended to
28   read:
29
30      “Section 41-43-150. (A) The programs established by this act
31   are administered so as to ensure that each application for assistance
32   is evaluated without regard to race, creed, sex, or national origin
33   and that no person, firm, association, partnership, corporation,
34   agency, or entity, or group thereof, receives disproportionate
35   benefits from the programs.
36      (B) To qualify for assistance under the programs established
37   pursuant to Sections 41-43-160, 41-43-170 and 41-43-190 the
38   following conditions must be met:
39        (1) The recipient must be a person, firm, association,
40   partnership, corporation, or other entity engaged in business on a
41   for-profit or nonprofit basis.
42        (2) The assistance must be requested for use by a business
43   enterprise located within the State.

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 1        (3) The recipient must be able to demonstrate to the
 2   authority that the assistance will result in creation or maintenance
 3   of employment within the State or result in other significant
 4   economic benefit to the State.
 5        (4) The recipient and the project or the financing must meet
 6   any further requirements for eligibility as are set forth in this act
 7   with respect to the specific program under which assistance is
 8   requested.
 9        (5) The recipient and the project must satisfy any applicable
10   requirements set forth by the authority in its regulations.
11      (C) The authority may authorize assistance to an eligible
12   recipient under the programs established pursuant to Sections
13   41-43-160, 41-43-170 and 41-43-190 only after it has made the
14   following findings:
15        (1) The recipient is a responsible party.
16        (2) The number of jobs or other economic benefits resulting
17   from the assistance bears a reasonable relationship to the amount
18   of program funds committed, taking into account factors such as
19   the amount of dollars invested per employee or relative to other
20   economic benefits at comparable facilities.
21        (3) The amount of program funds committed bears a
22   reasonable relationship to the amount of private funds committed.
23        (4) The size and scope of the business being assisted is such
24   that a definite benefit to the economy of the State may reasonably
25   be expected to result from the project being financed.
26        (5) The terms of the agreements to be entered into in
27   connection with the transaction are reasonable and proper, taking
28   into account such factors as the type of program involved, the
29   amount of program funds involved, and the number and type of
30   jobs involved, and the type and scope of other economic benefits
31   to the State involved.
32        (6) The public interest is adequately protected by the terms
33   of the agreements to be entered into in connection with the
34   transaction.
35      In making its findings, the authority is entitled to rely upon its
36   own investigation or upon such information and evidence
37   furnished to it by recipient businesses or by lending institutions
38   participating in programs established pursuant to the provisions of
39   this act as the authority considers appropriate. Compliance by a
40   recipient or any lending institution participating in any of the
41   authority’s programs under the provisions of this act with the terms
42   of any agreement may be enforced by decree of a circuit court of
43   this State. The authority may require as a condition of any loan to,

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 1   or purchase of loans from, any national banking association or
 2   federally chartered savings and loan association or any nonresident
 3   seller, consent to the jurisdiction of the circuit courts of this State
 4   over any enforcement proceeding.”
 5
 6   SECTION 5. Section 41-43-160 of the 1976 Code, as last
 7   amended by Act 404 of 1992, is further amended to read:
 8
 9      “Section 41-43-160. The authority may utilize any of its
10   program funds to establish loan programs pursuant to this section
11   for the purpose of reducing the cost of capital to business
12   enterprises which meet the eligibility requirements of Section
13   41-43-150. Proceeds of loans under this section are may be
14   utilized:
15           (i) to acquire, by construction or purchase, land and
16   buildings or other improvements thereon, machinery, equipment,
17   office furnishings or other depreciable assets, tangible or
18   intangible, or for research and design costs, legal and accounting
19   fees, or other expenses in connection with the acquisition or
20   construction thereof; or
21           (ii) for the research, testing, and developing of new
22   products, machinery, equipment, and industrial or commercial
23   processes, and the initial marketing thereof. Loan proceeds also
24   may be used to finance working capital. The authority shall
25   require as a condition of each loan made pursuant to this section
26   that the loan must be serviced by a loan administrator which meets
27   criteria established by the authority.
28      The authority may make direct loans to any eligible business
29   enterprises upon terms which require the proceeds of the loan to be
30   used for qualified purposes and upon such other terms and
31   conditions as the authority may require.
32      The authority may make loans to lending institutions upon terms
33   and conditions which require each lending institution to disburse
34   the loan proceeds for new loans to eligible businesses for qualified
35   purposes in an aggregate principal amount of not less than the
36   amount of the loan. The authority must require of each lender to
37   which it has made a loan evidence satisfactory to it of the making
38   of new loans which satisfy the requirements of this item and of the
39   regulations of the authority. In this connection, the authority,
40   through its agents, may inspect the books and records of such
41   lender to verify that the requirements are being met.
42      The authority must require that each lender receiving a loan
43   pursuant to this section issue and deliver to the authority evidence

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 1   of its indebtedness to the authority which constitutes a general
 2   obligation of the lender. The evidence of indebtedness must bear a
 3   date, time of maturity, be subject to prepayment, and contain any
 4   other provisions consistent with this section and related to
 5   protecting the security of the authority’s investment and the bonds
 6   issued by the authority in connection with such loan.
 7      The authority may purchase, and make advance commitments to
 8   purchase, from lending institutions loans to eligible business
 9   enterprises. The purchase price for each loan which the authority
10   purchases pursuant to this paragraph is not to exceed the total of
11   the unpaid principal balance of the loan purchased plus accrued
12   interest. The authority must require each lender from which the
13   authority purchases, or commits to purchase, a loan to submit
14   evidence satisfactory to the authority that the loan satisfies the
15   conditions of this section and of the regulations of the authority. In
16   this connection, the authority, through its agents, may inspect the
17   books and records of a lender to verify that the conditions have
18   been met.
19      The authority must require the recording of an assignment of
20   each mortgage or secured loan purchased by it from a lender and
21   need not notify the borrower of its purchase of the mortgage or
22   secured loan. The authority is not required to inspect or take
23   possession of the loan documents if the lender from which the loan
24   document is purchased enters into a contract to service the loan
25   and account for it to the authority.
26      The authority may:
27           (i)renegotiate a loan in default, waive a default, or consent
28   to the modification of the terms of a loan;
29           (ii) forgive or forbear all or part of a loan;
30           (iii) prosecute and enforce a judgment in any action,
31   including but not limited to a foreclosure action; or
32           (iv) protect or enforce any right conferred upon it by law,
33   or by any loan, contract, or other agreement. In connection with
34   any action, the authority may bid for and purchase collateral or
35   take possession of it, administer it, or pay the principal of and
36   interest on any obligation incurred in connection with the collateral
37   and dispose of and otherwise deal with the property securing the
38   loan in default.”
39
40   SECTION 6. This act takes effect upon approval by the Governor.
41                            ----XX----
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