North Carolina § 159-97 - Taxes for supplementing revenue bond projects.

§ 159-97. Taxes for supplementing revenue bond projects.

For the purpose of supplementing the revenues of a revenue bond project, as defined in this section, any county or city may covenant with, or may enter into an agreement with a municipality for the benefit of the holders of revenue bonds of the issuing municipality issued pursuant to this Article, whereby such county or city agrees to: Levy for the life of all revenue bonds issued in connection with the revenue bond project an annual property tax not in excess of the rate set forth in the question submitted to voters as hereinafter provided, such levy to be based upon the operating supplement requirement, as defined in this section, or Levy for the life of the revenue bonds in respect of which such tax is being levied an annual property tax not in excess of the rate required to pay the principal of and the interest on the aggregate principal amount of revenue bonds set forth in the question submitted to the voters as hereinafter provided, such levy to be based upon the debt service reserve supplement requirement, as defined in this section. A covenant made, or the pledge of an agreement entered into, by a county or city pursuant to this section shall be effected by the provisions of the revenue bond order or the trust agreement securing revenue bonds of the issuing municipality and where the issuing municipality is not also the taxing county or city a resolution of the county or city approving the appropriate provisions of the bond order or trust agreement relating to the pledge of the tax. If the taxing county or city is not the issuing municipality, it shall file an application for approval of the resolution with the secretary of the Commission in the manner provided in G.S. 159-149, and the Commission shall determine whether to approve the application as provided by G.S. 159-151 and 159-152; provided, however, that G.S. 159-148 and 159-150 shall have no application to this section. A covenant made, or agreement entered into, by a county or city pursuant to this section shall take effect only if approved by the affirmative vote of a majority of those who vote thereon in a referendum held in the taxing county or city. The referendum shall be called and held as provided in G.S. 159-61, except that The ballot proposition shall be in substantially one of the following forms: The published statement of result shall have the following statement appended: Any action or proceeding in any court to set aside a supplemental tax referendum held under this section, or to obtain any other relief, upon the ground that the referendum is invalid or was irregularly conducted, must be begun within 30 days after the publication of the statement of the result of the referendum. After the expiration of this period of limitation, no right of action or defense based upon the invalidity of or any irregularity in the referendum shall be asserted, nor shall the validity of the referendum be open to question in any court upon any ground whatever, except in an action or proceeding begun within the period of limitation prescribed in this subsection. An order or agreement submitted to and approved by the voters pursuant to this section may be repealed at any time before bonds are issued pursuant thereto. In instances where the taxing county or city is not the issuing municipality, such county or city may levy taxes as provided for in this section in respect of a revenue bond project located outside its corporate limits provided that such county or city is entitled by law to appoint one or more members of the governing body of such municipality. For the purposes of this section, A "revenue bond project" is limited, notwithstanding the provisions of G.S. 159-81, to (i) aeronautical facilities, including but not limited to airports, terminals and hangars, (ii) hospitals and other health-related facilities, and (iii) systems, facilities and equipment for the collection, treatment or disposal of solid waste within the meaning of said G.S. 159-81; An "operating supplement requirement" occurs when, as set forth in the budget prepared by the issuing municipality in respect of the revenue bond project, the estimated cost in the next succeeding fiscal year of the (i) current operating expenses of the revenue bond project, (ii) amount required to maintain the debt service reserve by repaying any withdrawals therefrom in respect of all outstanding bonds issued in connection with the revenue bond project, and (iii) debt service on all outstanding bonds issued in connection with the revenue bond project, are in excess of the pledged revenues of the revenue bond project for such fiscal year as estimated by the issuing municipality, excluding taxes levied pursuant to this section; provided, however, that the amount of the operating supplement requirement shall not exceed the total amount of the current operating expenses of the revenue bond project mentioned in clause (i) above, and A "debt service reserve supplement requirement" occurs when there have been withdrawn from the debt service reserve any moneys for the purpose of paying debt service on the bonds in respect of which the supplemental tax has been authorized by the voters; provided, however, that the amount of the debt service reserve supplement requirement shall not exceed the amount so withdrawn. Any covenant or agreement of a county or city made pursuant to this section, and the obligations assumed thereby, shall be excludable from the gross debt of the county or city for purposes of the statement of debt mentioned in G.S. 159-55. For the purposes of this section the terms county or city shall include a special airport district with respect to financing of aeronautical facilities. When any such covenant has been made or any such agreement has been entered into, the issuing municipality shall determine, and, in those instances in which the issuing municipality is not also the taxing county or city, the issuing municipality shall certify to the governing board of the taxing county or city, by not later than June 1 of each fiscal year the amount required, determined as hereinafter provided, to be raised by taxation by such county or city in the next fiscal year. The county or city is obligated to levy such tax only to the extent that an operating supplement requirement or a debt service reserve supplement requirement shall occur during the fiscal year preceding the fiscal year in which the tax is to be levied. In no event shall the county or city be required to levy a tax in excess of the rate required to be levied in accordance with the approval of the voters as provided in subsection (c). When any such tax is to be levied, the county or city shall include in its budget ordinance an appropriation to the issuing municipality or the appropriate fund, as the case may be, equal to the estimated yield of the tax levy, and shall pay such appropriation to the issuing municipality or transfer moneys to the appropriate fund in equal monthly installments unless another mutually satisfactory schedule of payments is agreed upon. Operating Supplement Requirement: "Shall the (order or agreement) binding the (taxing county or city) to levy annually a tax on property not in excess of ____________ cents on the one hundred dollars ($100.00) value of property subject to taxation for the purpose of supplementing the revenues of (revenue bond project) in instances where the gross revenues of the project are estimated to be less than the estimated total costs of the (i) current operating expenses of the project, (ii) amount required to maintain the debt service reserve by repaying any withdrawals therefrom in respect of all outstanding bonds issued in connection with the project and (iii) debt service on all outstanding bonds issued in connection with the project, all as defined in such (order or agreement), the proceeds of such tax to be used for the payment of the current operating expenses of the project so long as any revenue bonds issued therefor remain outstanding and unpaid, be approved? [ ] Yes [ ] No" Debt Service Reserve Supplement Requirement: "Shall the (order or agreement) binding the (taxing county or city) to levy annually, without limitation as to rate or amount, a tax on property subject to taxation for the purpose of supplementing the revenues of (revenue bond project) for maintaining the debt service reserve required by said (order or agreement) in connection with the issuance of not in excess of $ ____________ revenue bonds of (the issuing municipality), so long as any of such revenue bonds remain outstanding and unpaid, be approved? [ ] Yes [ ] No" and "Any action or proceeding challenging the regularity or validity of this supplemental tax referendum must be begun within 30 days after (date of publication). _____________________________________________________________________ (title of governing board)." History (1973, c. 786, s. 1; 1979, c. 727, s. 5; 1983, c. 795, s. 6.) Editor's Note. - Session Laws 1983, c. 795, s. 7, provided: "Sections 5 and 6 of this act shall be deemed to provide an additional and alternative method for the doing of the things authorized thereby and shall be regarded as supplemental and additional to powers conferred by other laws, and shall not be regarded as in derogation of any powers now existing." Session Laws 2019-199, s. 3(a)-(e), provides: "(a) Definition. - As used in this section, the term 'Neuse River Basin Airport Rules' means all of the following: "(1) The Neuse River Basin: Nutrient Sensitive Waters Management Strategy: Protection and Maintenance of Existing Riparian Buffers (15A NCAC 02B.0233), including the proposed readoption and recodification as 15A NCAC 02B.0714 adopted by the Environmental Management Commission on March 14, 2019, and approved by the Rules Review Commission on May 16, 2019. "(2) The definition of 'Airport Facilities' in 15A NCAC 2B.0610 adopted by the Environmental Management Commission on March 14, 2019, and approved by the Rules Review Commission on May 16, 2019. "(b) Neuse River Basin Airport Rules. - Until the effective date of the revised permanent rules that the Environmental Management Commission is required to adopt pursuant to subsection (d) of this section, the Commission and the Department of Environmental Quality shall implement the Neuse River Basin Airport Rules as provided in subsection (c) of this section. "(c) Implementation. - The definition of 'Airport Facilities' shall be as follows: "All properties, facilities, buildings, structures, and activities that satisfy or otherwise fall within the scope of one or more of the definitions or uses of the words or phrases 'air navigation facility,' 'airport,' or 'airport protection privileges' under G.S. 63-1 ; the definition of 'aeronautical facilities' in G.S. 63-79(1) ; the phrase 'airport facilities' as used in G.S. 159-48(b)(1); the phrase 'aeronautical facilities' as defined in G.S. 159-81 and G.S. 159-97; and the phrase 'airport facilities and improvements' as used in Section 13 of Article V of the North Carolina Constitution. Airport facilities shall include, without limitation, any and all of the following: "(1) The airport and all of its terminals and terminal shops and support buildings. "(2) Runways, taxiways, clear zones, and other paved or unpaved areas, or open or restricted landing areas on the airport. "(3) Airport offices and administrative buildings. "(4) Buildings, structures, equipment, and facilities intended to support aircraft operations, including, without limitation, hangars and other aircraft maintenance buildings, storage buildings or areas, and including, without limitation, anything shown on any airport development plan submitted to the Federal Aviation Administration. "(5) Navigational and signal systems, including any structures, mechanisms, landing lighting and lights, beacons, marks, communicating systems, or other instrumentalities or devices used or useful as an aid, or constituting an advantage or convenience to the safe taking off, navigation, and landing of aircraft, or the safe and efficient operation or maintenance of an airport or restricted landing area. "(6) Parking owned or operated by the airport to serve the airport's operations, whether located on the airport or as satellite parking. "(7) Drainage ditches or pipes, stormwater structures, and related stormwater outfalls. "(8) Retail and commercial development outside of the terminal area but located on the airport, including rental car facilities, hotels, industrial facilities, freestanding offices, and other similar buildings constructed on the airport, whether or not owned or operated by the airport. "(9) All appurtenant areas used or suitable for airport buildings or other airport facilities, including all appurtenant rights-of-way. "(10) Easements through, or other interests in, airspace over land or water, interests in airport hazards outside the boundaries of the airport or restricted landing area, and other protection privileges, the acquisition or control of which is necessary to ensure safe approaches to the landing areas of the airport and restricted landing areas and the safe and efficient operation thereof. "(11) Any combination of any or all of such properties, facilities, buildings, structures, activities, and easements. "(d) Additional Rule-Making Authority. - The Commission shall adopt rules to amend the Neuse River Basin Airport Rules (as defined in subsection (a) of this section) consistent with subsection (c) of this section. Notwithstanding G.S. 150B-19(4) , the rules adopted by the Commission, pursuant to this section, shall be substantively identical to the provisions of subsection (c) of this section. Rules adopted pursuant to this section are not subject to Part 3 of Article 2A of Chapter 150B of the General Statutes. Rules adopted pursuant to this section shall become effective as provided in G.S. 150B-21.3(b1) as though 10 or more written objections had been received as provided by G.S. 150B-21.3(b2) . "(e) Sunset. - This section expires when permanent rules adopted as required by subsection (d) of this section become effective." § 159-98: Reserved for future codification purposes.