A BILL TO BE ENTITLED
AN ACT TO require a referendum on certificates of participation and similar debt.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 160A‑20 reads as rewritten:
"§ 160A‑20.  Security interests.
…
(i)	Voter Approval Requirement. –
(1)	The governing board of a unit that intends to enter into a contract pursuant to subsection (a) or (b) of this section must adopt a resolution stating its intent at least 10 days before executing the contract. The resolution must state the maximum amount of the proposed contract. Contingent obligations shall be included in calculating the value of the contract. Several contracts that are all related to the same undertaking shall be deemed a single contract for purposes of this subsection. The resolution also must describe the basic purpose of the contract and state that the contract is a form of debt financing.
(2)	If Local Government Commission approval of the contract is required by subsection (e) of this section, a petition demanding that a contract entered into under subsection (a) or (b) of this section be submitted to the voters may be filed with the clerk to the board any time prior to the Local Government Commission's entry of the order approving the application pursuant to G.S. 159‑152. If Local Government Commission approval of the contract is not required by subsection (e) of this section, the petition must be filed with the clerk within 10 days of the governing board's adoption of the resolution stating its intent to enter into the contract pursuant to subsection (a) or (b) of this section. The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(3)	If a contract requires approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required.
(4)	The date of a voter referendum on the contract shall be fixed by the governing board, but shall not be more than one year after adoption of the resolution indicating the board's intent to enter into a contract pursuant to subsection (a) or (b) of this section, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or contract entered into pursuant thereto. The referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(5)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed contract, the purpose of the contract, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(6)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the [name of unit of local government] be authorized to enter into a contract pursuant to G.S. 160A‑20(a) or (b) and incur debt in the maximum amount of $________ plus interest for [briefly stating the purpose] be approved?
[  ] YES
[  ] NO"
(7)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board."
SECTION 2.  G.S. 159‑85 reads as rewritten:
"§ 159‑85.  Application to Commission for approval of revenue bond issue; preliminary conference; acceptance of application; voter approval requirement.
(a)	Neither the State nor a municipality may issue revenue bonds under this Article unless the issue is approved by the Commission. The State Treasurer or the governing board of the issuing municipality or its duly authorized agent, as the case may be, shall file an application for Commission approval of the issue with the secretary of the Commission. If the issuing municipality is a regional public transportation authority, the application must be accompanied by a resolution of the special tax board of that authority approving of the application. The application shall state such facts and have attached to it such documents concerning the proposed revenue bonds and the financial condition of the State or the issuing municipality, as the case may be, and its utilities and enterprises as the secretary may require. The Commission may prescribe the form of the application. At the time of application to the Commission, the governing body shall publish a public notice of the application in a newspaper of general circulation in the unit of local government.
…
(e)	A petition demanding that the revenue bond order be submitted to the voters may be filed with the clerk to the board at any time before the Commission enters its order approving or denying the application pursuant to G.S. 159‑87. The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(f)	If a bond order is to take effect upon approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required. The date of a bond referendum shall be fixed by the governing board, but shall not be more than one year after adoption of the bond order, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or bonds issued pursuant thereto. The bond referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(g)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed bonds, the purpose of the bonds, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(h)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the order authorizing $______ revenue bonds plus interest [briefly stating the purpose] be approved?
[  ] YES
[  ] NO"
(i)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board."
SECTION 3.  G.S. 159‑104 reads as rewritten:
"§ 159‑104.  Application to Commission for approval of project development financing debt instrument issue; preliminary conference; acceptance of application; voter approval requirement.
(a)	A unit of local government may not issue project development financing debt instruments under this Article unless the issue is approved by the Local Government Commission. The governing body of the issuing unit shall file with the secretary of the Commission an application for Commission approval of the issue. At the time of application, the governing body shall publish a public notice of the application in a newspaper of general circulation in the unit of local government. The application shall include any statements of facts and documents concerning the proposed debt instruments, development financing district, and development financing plan, and the financial condition of the unit, required by the secretary. The Commission may prescribe the form of the application.
Before accepting the application, the secretary may require the governing body or its representatives to attend a preliminary conference in order to discuss informally the proposed issue, district, and plan and the timing of the steps to be taken in issuing the debt instruments. The development financing plan need not be adopted by the governing body at the time it files the application with the secretary. However, before the Commission may enter its order approving the debt instruments, the governing body must adopt the plan and make the findings described in G.S. 159‑105(b)(1) and (5).
After an application in proper form and order has been filed, and after a preliminary conference if one is required, the secretary shall notify the unit in writing that the application has been filed and accepted for submission to the Commission. The secretary's statement is conclusive evidence that the unit has complied with this section."
(b)	A petition demanding that the project development financing be submitted to the voters may be filed with the clerk to the board at any time before the Commission enters its order approving or denying the application pursuant to G.S. 159‑106. The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(c)	If a project development financing requires approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required. The date of a referendum shall be fixed by the governing board, but shall not be more than one year after adoption of the project development financing plan, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or debt instruments issued pursuant thereto. The referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(d)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed debt instruments, the purpose of the debt instruments, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(e)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the [unit name here] be authorized to borrow $______ plus instrument by issuing project development financing debt instruments for [briefly state purpose]?
[  ] YES
[  ] NO"
(f)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board."
SECTION 4.  G.S. 159I‑30 reads as rewritten:
"§ 159I‑30.  Additional powers of units of local government; issuance of special obligation bonds and notes.
…
(i)	Local Government Commission Approval. – No bonds or notes may be issued by a unit of local government under this section unless the issuance is approved and the bonds or notes are sold by the Local Government Commission as provided in this section and the applicable provisions of this Chapter. The unit shall file with the Secretary of the Local Government Commission an application requesting approval of the issuance of the bonds or notes, which application shall contain such information and shall have attached to it such documents concerning the proposed financing as the Secretary of the Local Government Commission may require. The Commission may prescribe the form of the application. Before the Secretary accepts the application, the Secretary may require the governing body of the unit or its representatives to attend a preliminary conference, at which time the Secretary or the deputies of the Secretary may informally discuss the proposed issue and the timing of the steps taken in issuing the special obligation bonds or notes. At the time of application to the Commission, the governing body shall publish a public notice of the application in a newspaper of general circulation in the unit of local government.
In determining whether a proposed bond or note issue should be approved, the Local Government Commission may consider, to the extent applicable as shall be determined by the Local Government Commission, the criteria set forth in G.S. 159‑52 and G.S. 159‑86, as either may be amended from time to time, as well as the effect of the proposed financing upon any scheduled or proposed sale of obligations by the State or by any of its agencies or departments or by any unit of local government in the State. The Local Government Commission shall approve the issuance of the bonds or notes if, upon the information and evidence it receives, it finds and determines that the proposed financing will satisfy such criteria and will effect the purposes of this section and the applicable provisions of this Chapter. An approval of an issue shall not be regarded as an approval of the legality of the issue in any respect. A decision by the Local Government Commission denying an application is final.
Upon the filing with the Local Government Commission of a written request of the unit requesting that its bonds or notes be sold, the bonds or notes may be sold by the Local Government Commission in such manner, either at public or private sale, and for such price or prices as the Local Government Commission shall determine to be in the best interests of the unit and to effect the purposes of this section and the applicable provisions of this Chapter, if the sale is approved by the unit.
(i1)	(1)	A petition demanding that the special obligation bond order be submitted to the voters may be filed with the clerk to the board at any time before the Commission enters its order approving or denying the application pursuant to G.S. 159I‑30(i). The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(2)	If a special obligation bond order requires approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required. The date of a bond referendum shall be fixed by the governing board, but shall not be more than one year after adoption of the bond order, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or bonds issued pursuant thereto. The bond referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(3)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed bonds, the purpose of the bonds, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(4)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the [unit name here] be authorized to borrow $______ plus instrument by issuing special obligation bonds for [briefly state purpose]?
[  ] YES
[  ] NO"
(5)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board.
…."
SECTION 5.  G.S. 159‑60 reads as rewritten:
"§ 159‑60.  Petition for referendum on bond issue.
A petition demanding that a bond order be submitted to the voters may be filed with the clerk within 30 days after the date of publication of the bond order as introduced. The petition shall be in writing, and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after his signature. The petition need not contain the text of the order to which it refers, and need not be all on one sheet.
The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of his investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
"
SECTION 6.  G.S. 159‑148 reads as rewritten:
"§ 159‑148.  Contracts subject to Article; exceptions; voter approval requirement.
…
(c)	If a contract, agreement, memorandum of understanding, and any other transaction having the force and effect of a contract is subject to Commission approval, at the time of application to the Commission, the governing body of the unit of local government shall publish a public notice of the application in a newspaper of general circulation in the unit of local government.
(d)	(1)	A petition demanding that the contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval be submitted to the voters may be filed with the clerk to the board at any time before the Commission enters its order approving or denying the application pursuant to G.S. 159‑152. The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(2)	If a contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval requires approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required. The date of a referendum shall be fixed by the governing board, but shall not be more than one year after the original date of submission of the application to the Commission for approval, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval entered into pursuant thereto. The referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(3)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval, the purpose of the contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(4)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the [unit name here] be authorized to enter into the [contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval] in an amount to not exceed $______ for [briefly describe purpose]?
[  ] YES
[  ] NO"
(5)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board."
SECTION 7.  G.S. 159‑153
"§ 159‑153.  Approval of other financing arrangements; voter approval requirement.
…
(g)	If a transaction specified in subsection (a) of this section, and undertaken by a unit of local government, is subject to Commission approval, at the time of application to the Commission, the governing body of the unit of local government, shall publish a public notice of the application in a newspaper of general circulation in the unit of local government.
(h)	(1)	A petition demanding that the contract, agreement, memorandum of understanding, or other transaction having the force and effect of a contract subject to Commission approval be submitted to the voters may be filed with the clerk to the board at any time before the Commission enters its order approving or denying the application pursuant to this section. The petition shall be in writing and shall be signed by a number of voters of the issuing unit equal to not less than five percent (5%) of the total number of voters registered to vote in elections of the issuing unit according to the most recent figures certified by the State Board of Elections. The residence address of each signer shall be written after the signature. The clerk shall investigate the sufficiency of the petition and present it to the governing board, with a certificate stating the results of the investigation. The governing board, after hearing any taxpayer who may request to be heard, shall thereupon determine the sufficiency of the petition, and its determination shall be conclusive.
(2)	If a transaction specified in subsection (a) of this section, and undertaken by a unit of local government, requires approval of the voters, the affirmative vote or a majority of those who vote thereon shall be required. The date of a referendum shall be fixed by the governing board, but shall not be more than one year after the original date of submission of the application to the Commission for approval, only on a date permitted by G.S. 163‑287. The clerk shall mail or deliver a certified copy of the resolution calling a special referendum to the board of elections that is to conduct it within three days after the resolution is adopted, but failure to observe this requirement shall not in any manner affect the validity of the referendum or the transaction undertaken pursuant thereto. The referendum shall be conducted by the board of elections conducting regular elections of the unit of local government.
(3)	The clerk shall publish a notice of the referendum at least twice. The first publication shall be not less than 14 days and the second publication not less than seven days before the last day on which voters may register for the referendum. The notice shall state the date of the referendum, the maximum amount of the proposed transaction, the purpose of the transaction, and a statement as to the last day for registration for the referendum under the election laws then in effect.
(4)	The form of the question as stated on the ballot shall be in substantially the following words:
"Shall the [unit name here] be authorized to enter into the [transaction] in an amount not to exceed $______ for [briefly describe purpose]?
[  ] YES
[  ] NO"
(5)	The board of elections shall canvass the referendum and certify the results to the governing board. The governing board shall then certify and declare the result of the referendum and shall publish a statement of the result once, with the following statement appended:
"Any action or proceeding challenging the regularity or validity of this referendum must be begun within 30 days after [date of publication].
__________________
[Title of governing board]"
The statement of results shall be filed in the clerk's office and inserted in the minutes of the board."
SECTION 8.  This act is effective when it becomes law.