HB2323 - 521R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 35, chapter 5, Arizona Revised Statutes, is amended by adding article 7, to read:

ARTICLE 7. ARIZONA JOB FINANCE BONDS

START_STATUTE35-781. Definitions

In this article, unless the context otherwise requires:

1. "Employee" means an individual who receives wages or other remuneration as a result of providing services or labor.

2. "Full-time private sector employment":

(a) Means employment of an employee in a position that requires a minimum of thirty-five working hours per week.

(b) Includes a job-sharing arrangement in which two or more employees share a position that requires a minimum of thirty-five working hours per week.

3. "Jobs bonds" means revenue bonds, loans, leases, debentures, notes, certificates of participation or any other evidences of indebtedness issued to finance a jobs project or to refund outstanding obligations other than those issued by another corporation.

4. "Jobs project" means a commercial enterprise or a veteran-owned small business located within or without this state that creates full‑time private sector employment or any existing business with one or more full‑time private sector employees within this state, other than any project as defined in section 35‑701 within the state intended for any of the following:

(a) Single-family home ownership.

(b) Single-family residential rental housing.

(d) A sanitarium.

(e) A clinic.

(f) A medical hotel.

(g) A rest home.

(h) A nursing home.

(i) A skilled nursing facility.

(j) A life care facility as prescribed in section 20-1801.

5. "Jobs project costs" means all costs that are directly or indirectly related to a jobs project, including:

(a) Capital costs, including the costs of the construction of improvements, facilities, buildings, structures and permanent fixtures, the demolition, alteration, remodeling, renovation, repair or reconstruction of existing improvements, facilities, buildings, structures and permanent fixtures, the acquisition of equipment and the clearing and grading of land.

(b) Financing costs, including interest during construction, capitalized debt service, repair and replacement reserve funds or other appropriate reserves.

(d) Professional service costs, including those costs incurred for architectural, planning, engineering and legal advice and services.

(e) Administrative costs.

(f) Working capital costs.

(g) Costs incidental to any of the costs specified in this paragraph.

6. "Veteran-owned small business" means a business that is certified as a veteran-owned small business by the United States department of veterans affairs. END_STATUTE

START_STATUTE35-782. Jobs bonds

A. In addition to the powers provided in section 35-706, a corporation may issue jobs bonds from time to time, in its discretion, to finance or refinance any jobs project costs or to refund any outstanding jobs bonds it previously issued.

B. Jobs bonds issued pursuant to this article are deemed to be issued for an essential public and governmental purpose.

C. Jobs bonds issued pursuant to this article shall be authorized by resolution of the corporation and may be payable on demand or mature at such time or times, bear interest at such rate or rates, be in such denomination or denominations, be in registered form, carry such conversion or registration privileges, have such rank or priority, be executed in such manner, be payable in such medium of payment, at such place or places, from such source of repayment or security, and be subject to such terms of redemption and such other characteristics as may be provided by such resolution or trust indenture, deed of trust or mortgage issued pursuant thereto.

D. The governing body of a corporation may require approval of the proceedings under which jobs bonds are issued under this article. The governing body may require the corporation to have the jobs bonds reviewed by the attorney general pursuant to section 35-721, subsection F. If the governing body does not require approval of the proceedings or require review by the attorney general, a waiver of applicable requirements shall remain in effect for all jobs projects until the waiver is revoked by the governing board.

E. For jobs projects located outside this state, the corporation must determine by resolution that, in addition to benefitting this state by creating full-time private sector employment in this state, the financing will further advance the interests of this state by either or both of the following:

1. Discouraging the loss of commerce, industry or employment in this state.

2. Increasing employment in this state.

F. Jobs bonds may be sold by public or private sale at a price determined by the corporation in its sole discretion.

G. If an officer or director of the corporation whose signature appears on any jobs bonds issued pursuant to this article ceases to be an officer or director of the corporation before the delivery of the jobs bonds, the signature is valid and sufficient for all purposes in the same manner as if the officer or director had remained in office until delivery of the jobs bonds.

H. Jobs bonds issued pursuant to this article are legal investments for all banks, trust companies and insurance companies organized and operating under the laws of this state.

I. In order to comply with section 147(f) of the United States internal revenue code of 1986, as amended, the authority of the corporation is derived from this state and this state is the governmental unit on behalf of which any approved jobs bonds under this article are issued. The governor may approve the issuance of any jobs bonds issued by a corporation or may designate the secretary of state, the attorney general or the state treasurer to approve the issuance of any jobs bonds issued by a corporation for purposes of complying with federal laws requiring approval by an applicable elected representative. The governor or the governor's designee shall conduct a public hearing within thirty days after a written request by a corporation. The governor or the governor's designee may charge a fee for the purpose of conducting the public hearing requested by a corporation, and the corporation shall pay the fee on or before the date set for the public hearing. END_STATUTE

START_STATUTE35-783. Public entities; liability; prohibition; statement

A. A municipality or county is not liable for the payment of the principal or interest on any jobs bonds.

B. The credit or taxing power of a municipality or county may not be pledged in connection with jobs bonds issued pursuant to this article.

C. A corporation or other political subdivisions of this state are not liable on any jobs bonds issued pursuant to this article, other than the issuing corporation as a special obligation, limited solely to the revenues expressly pledged for repayment of the particular jobs bonds. The jobs bonds do not give rise to a general obligation or liability of the corporation, this state or any other political subdivision of this state, or give rise to a charge against the general credit of the corporation or the general credit or taxing power of this state or other political subdivisions of this state and are not payable out of any funds or properties other than the specific project revenues pledged or the jobs bonds.

D. The jobs bonds must contain a statement on their face consistent with subsection C of this section.

E. The jobs bonds do not constitute an indebtedness or the pledging of faith and credit within the meaning of any constitutional or statutory debt limitation or restriction. END_STATUTE

START_STATUTE35-784. Limitations on review

A. A direct or collateral action attacking or otherwise questioning the validity of a jobs project, the approval of any jobs bonds issued under this article or any of the findings or determinations of the corporation may not be brought until after the effective date of the resolution authorizing those jobs bonds.

B. For a period of ninety days after the effective date of the resolution, any person in interest may contest the legality of the resolution or proceeding or any jobs bonds that may be authorized by the resolution or proceeding. An action or proceeding to question the validity or legality of any resolution or proceeding, or of any jobs bonds authorized by the resolution or proceeding, may not be brought in any court by any person for any cause more than ninety days after the effective date of the resolution or proceeding. Ninety days after the effective date of the resolution or proceeding, the validity and legality of the resolution or proceeding and any jobs bonds authorized by the resolution or proceeding are deemed valid, and a court may not inquire into the validity and legality of the resolution or proceeding or any jobs bonds authorized by the resolution or proceeding after that date.

C. In any suit, action or proceeding involving the validity or enforceability of any jobs bonds issued under this article or the security of the jobs bonds, if the jobs bonds recite in substance that they have been issued for a jobs project, the jobs bonds are conclusively deemed to have been issued for that purpose and the jobs project is conclusively deemed to have been planned, located and financed in accordance with this article. END_STATUTE

START_STATUTE35-785. Documentation of job creation

In order to demonstrate that a jobs project will create full-time private sector employment, an applicant for financing under this article shall provide to the corporation one of the following:

1. Documentation consisting of photocopies of relevant tax records for the employee, if that employee has already been hired.

2. A copy of a comprehensive written business plan with projections showing that, due to the nature and projected size of the jobs project, the need for employees will result, including the approximate dates within the succeeding two years when the employees will be hired.

3. Documentation that the jobs project qualifies or has been approved for any of the following:

(a) Employment-related incentives under the healthy forest enterprise incentives program pursuant to section 41-1516.

(b) Arizona job training program grants pursuant to section 41-1541.

(d) Credit for new employment pursuant to section 43-1161.

(e) Credit for increased employment in military reuse zones pursuant to section 43-1167. END_STATUTE

START_STATUTE35-786. Construction of article; independent and comprehensive

This article is intended as an independent and comprehensive conferral of powers to accomplish the purposes set forth in this article. The powers conferred by this article are deemed full authority for the issuance of jobs bonds, for entering into agreements in connection with the issuance of jobs bonds and for the authorization, issuance and sale of jobs bonds pursuant to this article without regard to any other procedures required by any other law. END_STATUTE

Sec. 2. Severability

If a provision of this act or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the act that can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.