ENROLLED
COMMITTEE SUBSTITUTE
FOR
H. B. 412
(By Mr. Speaker, Mr. Kiss, and Delegate Trump)
[By Request of the Executive]
[Passed September 12, 2005; in effect from passage.]
AN ACT to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §23-2C-24; and to
amend and reenact §23-2D-4 of said code, all relating
generally to Workers' Compensation; authorizing the Governor
to condition the transfer of certain funds to the New Fund
administered by the successor to the Workers' Compensation
Commission upon repayment of the funds under surplus note or
other loan arrangement
; allowing additional flexibility in
terms and method for issuance of Workers' Compensation debt
reduction revenue bonds; and allowing use of derivative
products to reduce debt service costs and manage interest rate
exposure.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §23-2C-24; and that
§23-2D-4 of said code be amended and reenacted, all to read as
follows:
ARTICLE 2C. EMPLOYERS' MUTUAL INSURANCE COMPANY.
§23-2C-24. Surplus note or other loan arrangement for new fund.
(a) Notwithstanding any other provision of this article to the
contrary, the transfer of all or a portion of the remainder of
funds to be disbursed into the new fund as provided subsection (b),
section six of this article, in such amount as may be determined by
the Governor, may be conditioned upon the repayment thereof and
subject to the terms of a surplus note or other loan arrangement.
The Governor shall specify the amount that is to be transferred to
the new fund conditioned upon the repayment thereof and subject to
loan arrangement in the proclamation issued pursuant to section
eleven of this article. The terms of any such surplus note or
other loan arrangement must be approved by the Insurance
Commissioner before execution of the said proclamation.
(b) Payments received by the Treasurer from the company in
repayment of any outstanding surplus note or other loan arrangement
made pursuant to this subsection shall be deposited in the treasury
of the state to the credit of the old fund.
(c) The Insurance Commissioner may enter into such agreements,
including loan arrangements, with the company that are necessary to
accomplish the transfers addressed in this article.
ARTICLE 2D. WORKERS' COMPENSATION DEBT REDUCTION BONDS.
§23-2D-4. Workers' Compensation debt reduction revenue bonds;
amount; when may issue.
(a) Revenue bonds of the State of West Virginia are hereby authorized to be issued and sold by the West Virginia Economic
Development Authority created and provided in article fifteen,
chapter thirty-one of this code, solely for the paying down and
elimination of the current unfunded liability of the Workers'
Compensation Fund, as provided by the Constitution and the
provisions of this article. The principal of, and the interest and
redemption premium, if any, on the bonds shall be payable solely
from the special fund provided in section six of this article for
repayment.
(b) The West Virginia Economic Development Authority either
in the resolution authorizing the issuance of the bonds or by the
execution and delivery by the West Virginia Economic Development
Authority of a trust indenture or agreement, shall stipulate the
form of the bonds, whether the bonds are to be issued in one or
more series, the date or dates of issue, the time or times of
maturity, the rate or rates of interest payable on the bonds, which
may be at fixed rates or variable rates and which interest may be
current interest or may accrue, the denomination or denominations
in which the bonds are issued, the conversion or registration
privileges applicable to some or all of the bonds, the sources and
medium of payment and place or places of payment, the terms of
redemption, any privileges of exchangeability or interchangeability
applicable to the bonds, and the entitlement of holders of the
bonds and the providers of any agreements provided in subsection
(e) of this section to priorities of payment or security in the
amounts deposited in the West Virginia Workers' Compensation Debt Reduction Revenue Bond Debt Service Fund:
Provided, That in no
event may the amount of bonds issued pursuant to this article
exceed one billion five hundred million dollars:
Provided,
however, That the terms of the bonds shall not exceed thirty years
from their respective issuance dates.
(c) Revenue bonds issued under this article shall state on
their face that the bonds do not constitute a debt of the State of
West Virginia; that payment of the bonds, interest and charges
thereon cannot become an obligation of the State of West Virginia;
and that the bondholders' remedies are limited in all respects to
the "special revenue fund" established in this article for the
liquidation of the bonds.
(d) Net proceeds from sale of these bonds shall be deposited
in the Old Fund.
(e) In addition and not in limitation to the other provisions
of this section, in connection with any bonds issued or expected to
be issued pursuant to this article, the West Virginia Economic
Development Authority may enter into: (i) Commitments to purchase
or sell bonds and bond purchase or sale agreements; (ii) agreements
providing for credit enhancement or liquidity, including revolving
credit agreements, agreements establishing lines of credit or
letters of credit, insurance contracts, surety bonds and
reimbursement agreements; (iii) agreements to manage interest rate
exposure and tax risk and the return on investments, including
interest rate exchange agreements, interest rate cap, collar,
corridor, ceiling and floor agreements, option, rate spread or similar exposure agreements, float agreements and forward
agreements; (iv) stock exchange listing agreements; and (v) any
other commitments, contracts or agreements approved by the West
Virginia Economic Development Authority:
Provided, That the
provider or providers of any of the agreements set forth above may
be granted the same security and lien privileges as the bondholders
and upon execution of such agreements will constitute a contract
between the West Virginia Economic Development Authority and the
provider or providers.
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