Bill Text - SB223 (2014)

Authorizing municipalities to enter into contracts for the private funding and repayment of construction of sewer systems.


Revision: March 27, 2014, midnight

SB 223 – AS AMENDED BY THE HOUSE

01/30/14 0109s

5Mar2014… 0639h

2014 SESSION

14-2637

10/06

SENATE BILL 223

AN ACT authorizing municipalities to enter into contracts for the private funding and repayment of construction of sewer systems.

SPONSORS: Sen. Boutin, Dist 16; Sen. Bradley, Dist 3; Sen. Carson, Dist 14; Sen. Cataldo, Dist 6; Sen. Fuller Clark, Dist 21; Sen. Gilmour, Dist 12; Sen. Larsen, Dist 15; Sen. Odell, Dist 8; Sen. Pierce, Dist 5; Sen. Rausch, Dist 19; Sen. Reagan, Dist 17; Sen. Soucy, Dist 18; Sen. Stiles, Dist 24; Sen. Watters, Dist 4; Sen. Woodburn, Dist 1; Rep. Kotowski, Merr 24; Rep. T. Walsh, Merr 24; Rep. Campbell, Hills 33

COMMITTEE: Public and Municipal Affairs

ANALYSIS

This bill allows municipalities to permit the sewer commissioners, or the appropriate governing body, to enter into a contract for the design, construction, and funding of a new sewer or sewerage system and to provide for the repayment of the cost of funding using sewer rentals.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

01/30/14 0109s

5Mar2014… 0639h

14-2637

10/06

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Fourteen

AN ACT authorizing municipalities to enter into contracts for the private funding and repayment of construction of sewer systems.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Declaration of Public Purpose. It is hereby declared to be in the public interest to encourage the efficient expansion of public sewers in the most economical manner possible, thus providing encouragement to private developers and cities and towns to work cooperatively in the expansion of sewer systems, resulting in an improved pattern of economic development while reducing public tax burdens.

2 New Section; Sewers; Contracts for Private Construction and Reimbursement. Amend RSA?149-I by inserting after section 4 the following new section:

149-I:4-a Contracts for Private Construction and Reimbursement.

I. A municipality adopting this section may contract with a private nongovernmental entity for the design, construction, and funding of a new sewer or sewerage system, or addition or modification thereto, but not for the subsequent maintenance thereof, meeting approved governmental standards of design and construction, for any such project for which the municipality may incur indebtedness under RSA 33, and may hold, expend, or distribute funds pursuant to the terms of such contract with a private nongovernmental entity; provided that sewer rentals, fees, and other charges received from persons benefitting from the sewer project may be used for the repayment of costs of design and construction funded by the private nongovernmental entity.

II. A municipality may adopt the provisions of this section allowing the board of sewer commissioners, board of public works commissioners, sewer department, or appropriate governing body to enter into a contract with a private nongovernmental entity, as described in this section, by the following method:

(a) In a town, other than a town that has adopted a charter pursuant to RSA 49-D, the question shall be placed on the warrant of a special or annual town meeting, by the governing body or by petition pursuant to RSA 39:3.

(b) In a city or town that has adopted a charter pursuant to RSA 49-C or RSA 49-D, the legislative body may consider and act upon the question in accordance with its normal procedures for passage of resolutions, ordinances, and other legislation. In the alternative, the legislative body of such municipality may vote to place the question on the official ballot for any regular municipal election.

(c) The vote shall specify the provisions of this section allowing for a contract with a private nongovernmental entity for the design, construction, and funding of a sewer or sewerage system or addition or modification thereto. If a majority of those voting on the question vote “yes,” the procedure shall be available within the town or city on the date set by the governing body.

(d) A municipality may rescind the adoption provided in subparagraph (c) in the manner described in this paragraph.

III. The contract may provide for the transfer of sewer rentals, fees, and other charges as follows:

(a) Sewer rentals assessed under RSA 149-I:8 and system development charges for persons benefiting from the sewer project, held in a sewer fund under RSA 149-I:10, may be used for repayment of the costs of design and construction incurred by a private nongovernmental entity pursuant to the terms of the contract.

(b) Sewer rentals which would otherwise have been assessed to the private nongovernmental entity may be considered as sewer rentals levied, paid, and credited to the repayment under subparagraph (a).

IV. The contract shall provide for the following:

(a) Sewer rentals, fees, and other charges collected from persons served by the sewer project shall be separately accounted for within the sewer fund.

(b) No repayment obligation in the contract shall be made from funds other than from such separately accounted for sewer rentals, fees, and other charges in the sewer fund.

(c) The total of repayments under the contract shall not exceed the total costs of design and construction incurred by a private nongovernmental entity for the project.

(d) The contract shall contain a clause stating that no municipal general funds shall be appropriated for the repayment obligations under the contract.

(e) The contract under this section shall not be considered complete and enforceable until the final agreement is approved by majority vote of the governing body of the municipality.

V. The repayment obligation pursuant to a contract under this section shall at no time be included in the net indebtedness of the municipality for the purposes of RSA 33.

3 New Paragraph; Sewer Fund. Amend RSA 149-I:10 by inserting after paragraph III the following new paragraph:

IV. The sewer fund may be used for the repayment of the costs of design, construction, and funding provided for by contract under RSA 149-I:4-a.

4 Effective Date. This act shall take effect upon its passage.

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