PRIOR PRINTER'S NO. 689 PRINTER'S NO. 1642
No. 616 Session of 2005
INTRODUCED BY ZUG, WILT, ALLEN, ARGALL, ARMSTRONG, BEBKO-JONES,
BLAUM, BROWNE, BUNT, CAPPELLI, CLYMER, COSTA, CRAHALLA,
CREIGHTON, DALLY, DeWEESE, FAIRCHILD, FRANKEL, GEORGE, GOOD,
GRUCELA, HARPER, HICKERNELL, KILLION, MAJOR, MARKOSEK,
McGILL, McILHATTAN, McNAUGHTON, R. MILLER, NAILOR, PALLONE,
PHILLIPS, REICHLEY, ROEBUCK, SATHER, SAYLOR, SEMMEL,
B. SMITH, SOLOBAY, T. STEVENSON, TANGRETTI, E. Z. TAYLOR,
THOMAS, TIGUE, YOUNGBLOOD, R. STEVENSON AND BARRAR,
FEBRUARY 16, 2005
AS AMENDED ON THIRD CONSIDERATION, HOUSE OF REPRESENTATIVES,
APRIL 13, 2005
AN ACT
1 Establishing the Independent Higher Education and Community
2 Financing Program and the Board of Review.
3 The General Assembly of the Commonwealth of Pennsylvania
4 hereby enacts as follows:
5 Section 1. Short title.
6 This act shall be known and may be cited as the Independent
7 Higher Education and Community Financing Act.
8 Section 2. Definitions.
9 The following words and phrases when used in this act shall
10 have the meanings given to them in this section unless the
11 context clearly indicates otherwise:
12 "Authority." The Pennsylvania Higher Educational Facilities
13 Authority.
14 "Board." The Board of Review established in section 4
1 (relating to board).
2 "Borrower." Any independent institution of higher education.
3 "Department." The Department of Community and Economic
4 Development of the Commonwealth.
5 "Independent institution of higher education." Any
6 accredited nonprofit private or independent college or
7 university located in this Commonwealth.
8 "Program." The Independent Higher Education and Community
9 Financing Program established in section 3 (relating to
10 program).
11 Section 3. Program.
12 (a) Establishment.--The Independent Higher Education and
13 Community Financing Program is established in the department.
14 (b) Purpose.--The purpose of the program is to assist
15 independent institutions of higher education in capital projects
16 related to community and economic development projects.
17 (c) Application.--The board shall develop an application for
18 participation in the program. The board shall review
19 applications and approve or disapprove the bond financing for
20 each obligation based on the criteria outlined in subsection (d)
21 and the availability of debt service reimbursement for
22 independent institutions of higher education.
23 (d) Criteria.--The following criteria shall apply:
24 (1) Independent institutions of higher education shall
25 submit an application to the board for approval based on a
26 first-come-first-served basis, as the independent institution
27 of higher education is ready to have bonds issued.
28 (2) A single project may not be more than 10% of the
29 total amount of the bonds issued in any given fiscal year.
30 (3) Allowable expenditures for projects shall include
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1 educational facilities and facilities providing an economic
2 development benefit to the local community. No dormitories or
3 residence halls shall be funded under this act.
4 Section 4. Board.
5 (a) Establishment.--The Board of Review is established.
6 (b) Duties.--The board shall review the applications of
7 institutions of higher education for participation in the
8 program.
9 (c) Composition.--The board shall be composed of the
10 following members, one appointed by each of the following:
11 (1) The Governor.
12 (2) The President pro tempore of the Senate.
13 (3) The Minority Leader of the Senate.
14 (4) The Speaker of the House of Representatives.
15 (5) The Minority Leader of the House of Representatives.
16 (d) Election of chairperson of board.--The members of the
17 board shall elect a chairperson of the board.
18 (e) Term and vacancies.--The term of a board member shall
19 begin on the date of appointment. A member's term shall be
20 coterminous with that of the appointing authority, provided that
21 the member's term shall continue until a replacement is
22 appointed. Board members shall serve at the pleasure of the
23 appointing authority. Whenever a vacancy occurs on the board,
24 whether prior to or on the expiration of a term, the appointing
25 authority shall appoint a successor member within 30 days of the
26 vacancy. A member appointed to fill a vacancy occurring prior to
27 the expiration of a term shall serve the unexpired term.
28 (f) Meetings.--The board shall meet as frequently as it
29 deems appropriate but at least once during each quarter of the
30 fiscal year. In addition, a meeting of a board shall be called
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1 by the chairperson if a request for a meeting is submitted to
2 the chairperson by at least two members of the board. A majority
3 of the board shall constitute a quorum for the purpose of
4 conducting the business of the board and for all other purposes.
5 All actions of the board shall be taken by a majority of the
6 board. The provisions of 65 Pa.C.S. Ch. 7 (relating to open
7 meetings) shall apply to the board.
8 (g) Expenses.--A member shall not receive compensation or
9 remuneration, but shall be entitled to reimbursement for all
10 reasonable and necessary actual expenses.
11 Section 5. Bonds.
12 The following shall apply:
13 (1) All projects shall be financed through separate
14 bonds issued through the authority with the independent <--
15 institution of higher education as the borrower. Debt service
16 BONDS ISSUED BY THE AUTHORITY INDICATING THE INDEPENDENT <--
17 INSTITUTION OF HIGHER EDUCATION AS THE PAYOR. DEBT SERVICE
18 payments on each bond issue shall be made by the independent
19 institution of higher education. A 50% portion of the annual
20 debt service shall be reimbursed by the department to the
21 borrower.
22 (2) The authority may issue bond financings of
23 $50,000,000 per year for a period of five years for projects
24 for independent higher education institutions.
25 (3) The authority shall issue individual bonds, notes or
26 other obligations for each borrower in an amount sufficient
27 to finance the projects approved under the program and in
28 accordance with this act. The funds may also be used to
29 finance the administrative costs associated with the approval
30 process and the issuance of the bonds, notes or other
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1 obligations. No bond, note or other obligation shall be
2 issued for more than 30 years. In computing the amount of the
3 department's annual debt service, all bonds, notes or other
4 obligations which have been retired or which shall be issued
5 for refunding purposes shall be excluded.
6 (4) The authority shall issue bonds, notes or other
7 obligations in a manner as it shall determine in accordance
8 with the provisions of the act of December 6, 1967 (P.L.678,
9 No.318), known as The Pennsylvania Higher Educational
10 Facilities Authority Act of 1967.
11 Section 6. Regulations.
12 The department shall promulgate regulations to administer the
13 provisions of this act in cooperation with the board.
14 Section 7. Funding.
15 The General Assembly shall appropriate funds necessary to pay
16 for 50% of the debt service on bonds issued by the authority
17 under this act.
18 Section 8. Effective date.
19 This act shall take effect in 60 days.
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