Bill Text For HB2046 - Senate Floor Version

 1|                        SENATE FLOOR VERSION                           |
  |                            April 7, 2021                              |
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 3|ENGROSSED HOUSE                                                        |
  |BILL NO. 2046                        By: McCall of the House           |
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  |                                         and                           |
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  |                                         Simpson of the Senate         |
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 8|       An Act relating to higher education funding                     |
  |       districts; enacting the Higher Education Institution            |
 9|       Local Funding Act; making legislative findings;                 |
  |       providing for construction of act as amendment                  |
10|       pursuant to Section 9B of Article X of the Oklahoma             |
  |       Constitution; providing procedures for certain                  |
11|       institutions within The Oklahoma State System of                |
  |       Higher Education to form district; providing for                |
12|       creation of higher education funding district;                  |
  |       providing for resolution; prohibiting inclusion of              |
13|       certain territory within higher education funding               |
  |       districts; providing for election regarding formation           |
14|       and boundary of district; requiring preparation of              |
  |       map depicting district boundary; requiring county               |
15|       assessor to provide information regarding net                   |
  |       assessed values and exempt property; requiring county           |
16|       election board to provide precinct boundary map;                |
  |       providing for election procedures; requiring payment            |
17|       of election costs by institution of higher education;           |
  |       authorizing operational millage rate; prescribing               |
18|       procedures for issuance of bonds and sinking fund               |
  |       millage rate; providing for special elections;                  |
19|       providing for formation of district after approval at           |
  |       election; providing for application of certain                  |
20|       millage rates; imposing duty on county treasurer with           |
  |       respect to collection of revenues; prescribing                  |
21|       procedures for payment of revenues; prescribing                 |
  |       authorized purposes of expenditures; restricting use            |
22|       of revenues for certain purposes; prohibiting certain           |
  |       revenues from being taken into consideration for                |
23|       purposes of allocation by State Regents; providing              |
  |       for expenditure of bond proceeds; providing for                 |
24|       applicability of Internal Revenue Code of 1986 with             |
  |       respect to certain proceeds; prescribing maximum                |
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 1|       maturity of bonds; providing for procedures for sale            |
  |       of bonds; prescribing procedures for elections to               |
 2|       modify millage rates for operational expenditures;              |
  |       prohibiting modification of sinking fund millage                |
 3|       rates; providing for annexation or deannexation                 |
  |       procedures with respect to territory of higher                  |
 4|       education funding district; providing for                       |
  |       applicability of rules regarding annexation or                  |
 5|       deannexation of territory with respect to career                |
  |       technology districts; providing for codification; and           |
 6|       providing an effective date.                                    |
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 9|BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:                  |
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10|    SECTION 1.     NEW LAW     A new section of law to be codified     |
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11|in the Oklahoma Statutes as Section 9001 of Title 70, unless there     |
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12|is created a duplication in numbering, reads as follows:               |
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13|    This act shall be known and may be cited as the "Higher            |
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14|Education Institution Local Funding Act".                              |
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15|    SECTION 2.     NEW LAW     A new section of law to be codified     |
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16|in the Oklahoma Statutes as Section 9002 of Title 70, unless there     |
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17|is created a duplication in numbering, reads as follows:               |
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18|    The Legislature finds that providing access to additional          |
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19|sources of revenue for certain institutions within The Oklahoma        |
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20|State System of Higher Education is in furtherance of a policy for     |
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21|making postsecondary education accessible to more persons, providing   |
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22|increased educational opportunities, improved income-producing         |
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23|potential and other positive outcomes.  The provisions of this act     |
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 1|shall be considered an amendment authorized by subsection H of         |
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 2|Section 9B of Article X of the Oklahoma Constitution.                  |
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 3|    SECTION 3.     NEW LAW     A new section of law to be codified     |
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 4|in the Oklahoma Statutes as Section 9003 of Title 70, unless there     |
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 5|is created a duplication in numbering, reads as follows:               |
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 6|    An eligible two-year institution within The Oklahoma State         |
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 7|System of Higher Education that utilizes the procedures established    |
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 8|by this act shall be considered a higher education funding district    |
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 9|for purposes of establishing a district, organizing the district,      |
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10|calling for operational millage rates or sinking fund millage rates    |
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11|or both, in the same manner as provided by law pursuant to the         |
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12|provisions of Section 9B of Article X of the Oklahoma Constitution     |
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13|and the provisions of Title 70 of the Oklahoma Statutes which enable   |
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14|Section 9B of Article X.                                               |
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15|    SECTION 4.     NEW LAW     A new section of law to be codified     |
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16|in the Oklahoma Statutes as Section 9004 of Title 70, unless there     |
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17|is created a duplication in numbering, reads as follows:               |
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18|    A.  The board of regents of an eligible two-year college within    |
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19|The Oklahoma State System of Higher Education may adopt a resolution   |
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20|to cause the college to be included, for purposes of this act,         |
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21|within a higher education funding district.  The resolution shall      |
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22|require the approval of a majority of the members of the board of      |
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23|regents.                                                               |
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 1|    B.  No higher education funding district shall be allowed to       |
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 2|include the territory or establish any levy of any career technology   |
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 3|district including any existing college career technology district,    |
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 4|that has been formed prior to the proposed formation of a higher       |
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 5|education funding district.                                            |
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 6|    SECTION 5.     NEW LAW     A new section of law to be codified     |
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 7|in the Oklahoma Statutes as Section 9005 of Title 70, unless there     |
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 8|is created a duplication in numbering, reads as follows:               |
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 9|    A.  The board of regents of the eligible institution shall cause   |
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10|a map to be prepared depicting the boundary of the proposed district   |
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11|with the assets constituting the main campus of the institution to     |
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12|be located at some point within such boundary.                         |
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13|    B.  The county assessor of the county or counties within which     |
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14|the district is proposed to be located shall provide information to    |
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15|the board of regents regarding the net assessed value of all taxable   |
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16|property within the boundary of the proposed district including the    |
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17|identification of any real property exempt from taxation pursuant to   |
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18|the provisions of Section 6 of Article X of the Oklahoma               |
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19|Constitution, any other provision of the Oklahoma Constitution or      |
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20|the provisions of Section 2887 of Title 68 of the Oklahoma Statutes.   |
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21|    SECTION 6.     NEW LAW     A new section of law to be codified     |
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22|in the Oklahoma Statutes as Section 9006 of Title 70, unless there     |
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23|is created a duplication in numbering, reads as follows:               |
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arsid10493084 SENATE FLOOR VERSION - HB2046 SFLR                   Page 4
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 1|    The county election board of the county or counties within which   |
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 2|the proposed higher education funding district is to be located        |
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 3|shall provide a precinct boundary map of the proposed area to the      |
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 4|board of regents which has approved the resolution to call for a       |
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 5|vote to form and organize a higher education funding district.         |
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 6|    SECTION 7.     NEW LAW     A new section of law to be codified     |
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 7|in the Oklahoma Statutes as Section 9007 of Title 70, unless there     |
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 8|is created a duplication in numbering, reads as follows:               |
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 9|    A.  An election may be conducted in November of any                |
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10|even-numbered year in order to determine whether the proposed higher   |
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11|education funding district shall be formed and its initial             |
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12|operational millage rate, which shall not exceed the number of mills   |
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13|as prescribed by Section 9B of Article X of the Oklahoma               |
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14|Constitution.  If the certified election results show that a sixty     |
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15|percent (60%) majority of all votes cast are in favor of the           |
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16|creation of the higher education funding district, the county          |
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17|election board shall declare the district to have been established     |
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18|and, if an initial operational millage was submitted to the voters     |
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19|as part of the same ballot measure for creation of the district,       |
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20|shall also declare such millage rate to be established for the         |
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21|district.                                                              |
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22|    B.  If there are to be any bonds or other evidence of              |
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23|indebtedness issued by the district contemporaneously approved at      |
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24|the election calling for the formation of the district or at any       |
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 1|subsequent election called for the purposes of approving such bonds    |
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 2|or other evidence of indebtedness, such information as may be          |
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 3|required for the approval of a sinking fund millage rate as provided   |
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 4|by law shall also be included on the ballot, but the principal         |
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 5|amount of debt to be incurred, the projects to be constructed or       |
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 6|improved or acquired with the proceeds of the bonds, the maximum       |
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 7|maturity of the bonds and other information shall be included as       |
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 8|part of the ballot title if that question is submitted to the          |
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 9|voters.                                                                |
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10|    C.  A special election may be conducted in the manner prescribed   |
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11|by Section 12-116 of Title 26 of the Oklahoma Statutes if the          |
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12|question of the creation of the higher education funding district is   |
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13|to be submitted at any other time than a General Election.             |
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14|    D.  All costs for elections related to higher education funding    |
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15|districts shall be paid for by the institution of higher education     |
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16|for the benefit of which the district is being created or, after       |
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17|approval of such district, for the benefit of which the district was   |
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18|created.                                                               |
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19|    SECTION 8.     NEW LAW     A new section of law to be codified     |
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20|in the Oklahoma Statutes as Section 9008 of Title 70, unless there     |
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21|is created a duplication in numbering, reads as follows:               |
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22|    If approved by sixty percent (60%) or more of the voters at the    |
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23|election provided for by Section 7 of this act, there shall be         |
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24|created a higher education funding district which shall be governed    |
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 1|by the board of regents for the institution within The Oklahoma        |
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 2|State System of Higher Education that has managerial control for the   |
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 3|institution for the benefit of which the district has been created.    |
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 4|    SECTION 9.     NEW LAW     A new section of law to be codified     |
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 5|in the Oklahoma Statutes as Section 9009 of Title 70, unless there     |
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 6|is created a duplication in numbering, reads as follows:               |
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 7|    The millage levied by a higher education funding district shall    |
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 8|be applied to the net assessed value of all taxable property located   |
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 9|within the district each year in the same manner as provided by law    |
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10|for millage imposed by other ad valorem taxing jurisdictions.  The     |
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11|county treasurer shall include the tax due resulting from such         |
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12|millage in the same manner as provided by law for other ad valorem     |
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13|taxes.                                                                 |
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14|    SECTION 10.     NEW LAW     A new section of law to be codified    |
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15|in the Oklahoma Statutes as Section 9010 of Title 70, unless there     |
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16|is created a duplication in numbering, reads as follows:               |
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17|    A.  All revenues derived from the net assessed value of property   |
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18|located within the boundary of the higher education funding district   |
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19|shall be paid by the county treasurer to the general fund of the       |
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20|eligible institution or to such fund as may be specified by the        |
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21|board of regents for the institution, and the board of regents for     |
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22|the institution shall be authorized to expend such revenues in         |
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23|support of the operational expenses of the institution including,      |
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24|without limitation, employee salaries, employee benefits including     |
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 1|retirement benefits and health care benefits, federal or state         |
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 2|income or withholding taxes or related payroll taxes, utility costs,   |
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 3|insurance expenses, books, electronic instructional materials,         |
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 4|supplies for classrooms, upkeep of grounds and landscaping,            |
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 5|maintenance of physical plants such as heating and air conditioning    |
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 6|units, acquisition and maintenance of motor vehicles and such other    |
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 7|expenditures as may be approved by the board of regents pursuant to    |
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 8|such standards and procedures as the board of regents may establish.   |
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 9|    B.  None of the revenues derived from any millage rate imposed     |
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10|within the boundary of a higher education funding district may be      |
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11|used by an institution within The Oklahoma State System of Higher      |
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12|Education to compete with the services or programs offered by any      |
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13|existing career technology district which is either contiguous to      |
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14|the boundary of the higher education funding district or located in    |
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15|sufficiently close proximity to the higher education funding           |
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16|district that the programs or services offered by such career          |
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17|technology district would be duplicated or adversely impacted by the   |
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18|expenditure of funds by the institution which causes the formation     |
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19|of the higher education funding district pursuant to the provisions    |
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20|of this act.                                                           |
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21|    C.  The Oklahoma State Regents for Higher Education shall not      |
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22|take into consideration revenues derived from any millage levy         |
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23|imposed pursuant to the provisions of the Higher Education             |
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24|Institution Local Funding Act when allocating state-appropriated       |
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 1|funds for support of the institution which established a higher        |
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 2|education funding district pursuant to the provisions of this act.     |
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 3|    SECTION 11.     NEW LAW     A new section of law to be codified    |
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 4|in the Oklahoma Statutes as Section 9011 of Title 70, unless there     |
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 5|is created a duplication in numbering, reads as follows:               |
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 6|    A.  Proceeds from bonds or other evidence of indebtedness issued   |
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 7|by the higher education funding district may be expended on such       |
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 8|assets as authorized by the provisions of the Internal Revenue Code    |
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 9|of 1986, as amended, or other provisions of federal or state law       |
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10|based on whether the interest income paid to bondholders is exempt     |
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11|from federal or state income tax.                                      |
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12|    B.  Final maturity of any obligation issued by the higher          |
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13|education funding district shall not exceed twenty-five (25) years.    |
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14|    C.  Bonds or other evidence of indebtedness issued by a higher     |
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15|education funding district may be sold using such procedures as may    |
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16|be established by the board of regents of the institution for whose    |
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17|benefit the higher education funding district has been created.        |
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18|    SECTION 12.     NEW LAW     A new section of law to be codified    |
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19|in the Oklahoma Statutes as Section 9012 of Title 70, unless there     |
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20|is created a duplication in numbering, reads as follows:               |
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21|    After the formation of a higher education funding district         |
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22|authorized by this act, the question of modification of an             |
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23|operational millage rate may be submitted to the voters of the         |
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24|district by resolution of the board of regents of the institution      |
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 1|within The Oklahoma State System of Higher Education for the benefit   |
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 2|of which the district has been created or upon a petition signed by    |
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 3|ten percent (10%) or more of the eligible voters residing within the   |
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 4|boundary of a district.  No millage rate in excess of that provided    |
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 5|for in Section 9B of Article X of the Oklahoma Constitution may be     |
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 6|approved and no sinking fund millage rate for repayment of bonds or    |
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 7|other evidence of indebtedness may be modified pursuant to the         |
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 8|provisions of this section.  The question of modification of an        |
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 9|operational millage rate may be submitted at either a General          |
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10|Election or a special election with notice of the question to be       |
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11|provided in advance of the election date in the same manner as         |
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12|provided by law for similar questions pursuant to Section 9B of        |
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13|Article X of the Oklahoma Constitution or enabling legislation         |
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14|enacted pursuant to authority of that section.                         |
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15|    SECTION 13.     NEW LAW     A new section of law to be codified    |
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16|in the Oklahoma Statutes as Section 9013 of Title 70, unless there     |
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17|is created a duplication in numbering, reads as follows:               |
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18|    After the formation of a higher education funding district         |
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19|authorized by this act, the question of annexation or deannexation     |
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20|of territory comprising the district may be submitted either by        |
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21|resolution of the board of regents for the institution within The      |
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22|Oklahoma State System of Higher Education for whose benefit the        |
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23|district was created or by a petition signed by ten percent (10%) or   |
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24|more of the eligible voters of the district.  The procedures for       |
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 1|conducting the vote and implementing any changes in the boundary of    |
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 2|the higher education funding district shall be the same as those       |
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 3|prescribed by Section 9B of Article X of the Oklahoma Constitution     |
  |                                                                       |
 4|or enabling legislation enacted or administrative rules adopted        |
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 5|pursuant thereto.                                                      |
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 6|    SECTION 14.  This act shall become effective November 1, 2021.     |
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 7|COMMITTEE REPORT BY: COMMITTEE ON APPROPRIATIONS                       |
  |April 7, 2021 - DO PASS                                                |
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