SB 1916 by *Gresham


(HB 1132) by *Brooks H


Show Caption Text

Education - As introduced, authorizes local boards of education to enter into capital leases and build-to-suit capital leases of real or personal property for the use, construction, repair or renovation of school buildings and facilities. - Amends TCA Title 5; Title 6; Title 7; Title 9 and Title 49, Chapter 2.
  • Bill History
  • Amendments
  • Video
  • Summary
  • Fiscal Note
  • Votes
  • Actions For SB1916Date
    Action Def. in S. Ed. Comm. to 1/4/201205/04/2011
    Placed on S. Ed. Comm. cal. for 5/4/201104/27/2011
    Action Def. in S. Ed. Comm. to 4/27/201104/20/2011
    Placed on S. Ed. Comm. cal. for 4/20/201104/13/2011
    P2C, ref. to S. Ed. Comm.02/24/2011
    Intro., P1C.02/23/2011
    Filed for intro.02/17/2011
    Actions For HB1132Date
    Taken Off Notice For Cal. in s/c Finance Subcommittee of Finance, Ways & Means Committee 05/10/2011
    Placed on s/c cal Finance Subcommittee for 5/11/201105/04/2011
    Action Def. in s/c Finance Subcommittee to 5/11/201104/27/2011
    Placed on s/c cal Finance Subcommittee for 4/27/201104/20/2011
    Assigned to s/c Finance Subcommittee04/20/2011
    Rec. for Pass. if Am. ref. to: Finance, Ways & Means Committee04/19/2011
    Placed on cal. Education Committee for 4/19/201104/13/2011
    Action Def. in Education Committee to 4/19/201104/12/2011
    Placed on cal. Education Committee for 4/12/201104/06/2011
    Action Def. in Education Committee to 4/12/201104/05/2011
    Placed on cal. Education Committee for 4/5/201103/30/2011
    Action def. in Education Committee to 04/05/201103/29/2011
    Placed on cal. Education Committee for 3/29/201103/23/2011
    Rec. for pass. if am. by s/c ref. to Education Committee03/23/2011
    Placed on s/c cal Education Subcommittee for 3/23/201103/16/2011
    Action Def. in s/c Education Subcommittee to 3/23/201103/16/2011
    Placed on s/c cal Education Subcommittee for 3/16/201103/09/2011
    Action Def. in s/c Education Subcommittee to 3/16/201103/09/2011
    Placed on s/c cal Education Subcommittee for 3/9/201103/02/2011
    Assigned to s/c General Sub of Education02/23/2011
    P2C, ref. to Education Committee02/23/2011
    Intro., P1C.02/17/2011
    Filed for intro.02/16/2011
  • No amendments for SB1916.
    AmendmentsFiscal Memos
    HA0273Amendment 1-1 to HB1132Fiscal Memo for HA0273 (5075)  

    NOTE: Each fiscal memorandum applies only to the amendment(s) identified in the memorandum. The fiscal memorandum must be matched to any amendments that have been adopted.

  • Videos containing keyword: SB1916

  • Fiscal Summary

    Not Available


    Bill Summary

    This bill authorizes local boards of education (LEAs) to enter into capital leases and build-to-suit capital leases of real or personal property for the use, construction, repair or renovation of school buildings and facilities. "Capital lease" means a lease that transfers substantially all the benefits and risks of ownership to the lessee. "Build-to-suit capital lease" means a capital lease that provides for the construction of new facilities or the renovation of existing facilities by a private developer, the cost of which is estimated to be greater than $300,000.

    CAPITAL LEASES

    This bill authorizes LEAs to enter into capital leases of real or personal property for use as or in school buildings or school facilities. The term of any capital lease, including any renewal periods, may not exceed 40 years from the expected date that the LEA would take occupancy pursuant to the lease.

    Generally, under present law, all supplies, furniture, fixtures and materials purchased by a LEA must be purchased through the executive committee of the LEA.

    Under this bill, a capital lease may provide that the private developer is responsible for providing, or contracting for, construction, repair, or renovation work. Such work undertaken or contracted by a private developer is not subject to the above requirement that supplies, furniture, fixtures and materials be purchased through the executive committee, unless such work involves an estimated expenditure of $300,000 or more.

    A deficiency judgment may not be rendered against any LEA or local legislative body in any action for breach of a contractual obligation authorized by this bill, and the taxing power of a local government may not be pledged to secure any monies due under a contract authorized by this bill.

    A capital lease entered into under this bill would be considered a continuing contract for capital outlay and may be entered into for a period of years, as long as the local legislative body has appropriated funds to the LEA sufficient to service the first year of debt and the local legislative body has by binding resolution agreed to appropriate sufficient funds in ensuing fiscal years.

    Capital leases entered into under this bill are subject to approval by the local legislative body, if they are for five or more years, obligate the local legislative body to pay sums of money to another, and obligate the local legislative body over the full term of the contract including extension or renewal periods to payment of $500,000 or more.

    Present law regarding mechanics' and materialmen's liens would apply to any real property, improvement to the real property, and rights that flow with the real property that is subject to a capital lease under this bill. Real property that is subject to a capital lease under this bill would be subject to liens and foreclosure actions in the same manner and to the same extent as if the property were owned in fee simple by a private entity.

    BUILD-TO-SUIT CAPITAL LEASES

    This bill authorizes LEAs to enter into build-to-suit capital leases for property, products, services, and guaranties related to property for use as and in school buildings or school facilities. Before entering into a build-to-suit capital lease pursuant to this bill, the LEA must adopt a resolution. Before adopting the resolution, the LEA must publish a notice of its intent to enter into a build-to-suit capital lease at least 10 days in advance of the date of the meeting at which the action is contemplated and in a newspaper having general circulation within the geographic area served by the LEA.

    Required design and engineering services must be performed by an engineer or a licensed architect. Specifications for any new school building must be consistent with any requirements of present law regarding public building contracts. All applicable requirements for the review or approval of design and specifications for school buildings by the department of education, state fire marshal, state building commission, or procurement commission would apply to school buildings constructed, repaired, or renovated under a build-to-suit capital lease authorized under this bill.

    A private developer must seek competition and minority business participation that comply with the LEA's minority participation goal in connection with all construction work under this bill. This bill details the manner in which this requirement will be met. The LEA may require the private developer to provide a performance bond and payment bond for construction work.

    LEAs may enter into predevelopment agreements with a private developer in advance of entering into a build-to-suit capital lease. Predevelopment agreements, if entered into, must be approved by the local legislative body. Predevelopment agreements may include provisions for site selection, land acquisition, and site preparation and for building programming and design, including architectural and engineering services.

    Any build-to-suit capital lease may include provisions imposing responsibility on the private developer or any identified affiliated entity for any of the following:
    (1) Site selection, land acquisition, and site preparation;
    (2) Building programming and design, including architectural and engineering services;
    (3) Construction and construction management;
    (4) Financing;
    (5) Facility maintenance and repairs;
    (6) Energy usage guarantees;
    (7) Transfer of ownership of the leased property which is the subject of the build-to-suit lease to the LEA or local government at the end of term of such lease if provided within the terms of the build-to-suit capital lease; and
    (8) Any other guaranties, products, and services as the LEA may determine to be appropriate.

    A private developer must provide an irrevocable letter of credit for the benefit of laborers and materialmen of at least 5 percent of the total cost of the improvements which are the subject of the build-to-suit capital lease and must maintain the letter of credit throughout the construction of the project and for the succeeding six-month period.

  • No fiscal note for this bill.
  • House Floor and Committee Votes

              HB1132 by Brooks H - HOUSE EDUCATION ADMINISTRATION & PLANNING COMMITTEE:
    Recommended for passage w/amendments- refer to: Finance, Ways & Means Committee 4/19/2011
              Voice Vote - Ayes Prevail

              HB1132 by Brooks H - HOUSE EDUCATION ADMINISTRATION & PLANNING SUBCOMMITTEE:
    Recommended for passage w/amendments- refer to: Education Committee 3/23/2011
              Voice Vote - Ayes Prevail

    Senate Floor and Committee Votes

    Votes for Bill SB1916 by the Senate are not available.