Utah Code § 17D-4-301 Public infrastructure district bonds.
17D-4-301. Public infrastructure district bonds.
(1)
(a) Subject to Subsection (1)(b), a public infrastructure district may issue negotiable bonds or other debt instruments for the purposes described in Section 17D-4-203, as provided in, as applicable:
(i) Title 11, Chapter 14, Local Government Bonding Act;
(ii) Title 11, Chapter 27, Utah Refunding Bond Act;
(iii) Title 11, Chapter 42, Assessment Area Act;
(iv) Title 11, Chapter 42a, Commercial Property Assessed Clean Energy Act; and
(v) this section.
(b) A public infrastructure district created by a bonding political subdivision, as defined in Section 63C-25-101, may not issue bonds under this part unless the board first:
(i) adopts a parameters resolution for the bonds that sets forth:
(A) the maximum:
(I) amount of bonds;
(II) term; and
(III) interest rate; and
(B) the expected security for the bonds; and
(ii) submits the parameters resolution for review and recommendation to the State Finance Review Commission created in Section 63C-25-201.
(2) A public infrastructure district bond shall mature within 40 years of the date of issuance.
(3)
(a) A public infrastructure district may issue a limited tax bond, in the same manner as a general obligation bond:
(i)
(A) with the consent of 100% of surface property owners within the boundaries of the public infrastructure district; and
(B) with the consent of a majority of the registered voters, if any, within the boundaries of the proposed public infrastructure district as of the day on which the board finds that the consent of a majority of registered voters has been obtained; or
(ii) upon approval of a majority of the registered voters within the boundaries of the public infrastructure district voting in an election held for that purpose under Title 11, Chapter 14, Local Government Bonding Act.
(b) A limited tax bond described in Subsection (3)(a):
(i) is not subject to the limitation on a general obligation bond described in Subsection 17B-1-1102(4); and
(ii) is subject to a limitation, if any, on the principal amount of indebtedness as described in the governing document.
(c) Unless limited tax bonds are initially purchased exclusively by one or more qualified institutional buyers as defined in Rule 144A, 17 C.F.R. Sec. 230.144A, or an investment grade rating is obtained for the limited tax bonds by one or more nationally recognized rating agencies, the public infrastructure district may only issue limited tax bonds in denominations of not less than $500,000, and in integral multiples above $500,000 of not less than $1,000 each.
(d)
(i) Without any further election or consent of property owners or registered voters, a public infrastructure district may convert a limited tax bond described in Subsection (3)(a) to a general obligation bond if the principal amount of the related limited tax bond together with the principal amount of other related outstanding general obligation bonds of the public infrastructure district does not exceed 15% of the fair market value of taxable property in the public infrastructure district securing the general obligation bonds, determined by:
(A) an appraisal from an appraiser who is a member of the Appraisal Institute that is addressed to the public infrastructure district or a financial institution; or
(B) the most recent market value of the property from the assessor of the county in which the property is located.
(ii) The consent to the issuance of a limited tax bond described in Subsection (3)(a) is sufficient to meet any statutory or constitutional election requirement necessary for the issuance of the limited tax bond and any general obligation bond to be issued in place of the limited tax bond upon meeting the requirements of this Subsection (3)(d).
(e) A public infrastructure district that levies a property tax for payment of debt service on a limited tax bond issued under this section is not required to comply with the notice and hearing requirements of Section 59-2-919 unless the rate exceeds the rate established in:
(i) Section 17D-4-303, except as provided in Subsection (13);
(ii) the governing document; or
(iii) the documents relating to the issuance of the limited tax bond.
(4)
(a) For a public infrastructure district seeking the consent described in Subsection (3)(a)(i)(B), a public infrastructure district may:
(i) post a class A notice under Section 63G-30-102 for at least 30 days; and
(ii) mail a request for consent to each registered voter within the boundaries of the public infrastructure district according to voter registration records.
(b) The request for consent described in Subsection (4)(a)(ii) shall include:
(i) the purpose for the issuance of the bonds;
(ii) the maximum principal amount of the bonds to be issued;
(iii) the maximum tax rate proposed to be pledged for the repayment of the bonds;
(iv) the words "For the issuance of bonds" and "Against the issuance of bonds," with appropriate boxes in which the voter may indicate the voter's choice; and
(v) a return address and phone number where additional information may be obtained from the public infrastructure district.
(c) Any registered voter who does not return the request for consent within 30 days of the day they are mailed to the voter is considered:
(i) non-participatory in the request for consent; and
(ii) shall not be included in a calculation to determine the percentage of registered voters who consent to the issuance of bonds.
(d) If a majority of the registered voters who return the request for consent under this Subsection (4) indicate "For the issuance of bonds," or if no registered voters return the request for consent within the time frame described in Subsection (4)(c), the requirement described in Subsection (3)(a)(i)(B) is met.
(e) Nothing in this Subsection (4):
(i) prevents a public infrastructure district from obtaining the consent of registered voters for the issuance of a bond through another method; or
(ii) shall be interpreted to affect or otherwise interfere with any consents of registered voters obtained before the effective date of this bill.
(5) Nothing in this section shall be interpreted to:
(a) prevent a public infrastructure district from withdrawing property from the public infrastructure district's boundaries where the property owners or registered voters associated with that property do not consent to the issuance of bonds or vote against the issuance of bonds; or
(b) require a public infrastructure district to withdraw property from the public infrastructure district's boundaries where the property owners or registered voters associated with that property do not consent to the issuance of bonds or vote against the issuance of bonds.
(6)
(a) Beginning on March 25, 2025, once consent or approval is obtained under Subsection (3)(a), the consent or approval is valid for a period of 10 years from the day on which the board:
(i) adopts a resolution or ordinance finding that the consent or approval is obtained; and
(ii) publishes a notice of the resolution or ordinance described in Subsection (6)(a)(i) as a class A notice under Section 63G-30-102 for at least 30 days.
(b) The tolling provisions of Section 11-14-301 apply during the 10-year period described in Subsection (6)(a).
(c) After a public infrastructure district obtains consent or approval under Subsection (3)(a), the public infrastructure district does not require any additional consent to or approval of the issuance of bonds, and the subsequent annexation of property to, or withdrawal of property from, the public infrastructure district does not impact:
(i) the validity of already obtained consent or approval;
(ii) the 10-year period described in Subsection (6)(a); or
(iii) any bond issued, or to be issued, pursuant to the consent or approval that was obtained under Subsection (3)(a).
(d) Subsection (6)(a) does not invalidate or alter any consent or approval, or finding of consent or approval, that occurred before the effective date of this bill.
(7)
(a) Except as provided in Subsection (7)(b), there is no limitation on the duration of revenues that a public infrastructure district may receive to cover any shortfall in the payment of principal of and interest on a bond that the public infrastructure district issues.
(b) A public infrastructure governing document or bond documents may limit the duration of time described in Subsection (7)(a).
(8) Section 11-42-106 governs any action to challenge an assessment imposed by a public infrastructure district or any proceeding to designate an assessment area conducted by a public infrastructure district.
(9) A public infrastructure district is not a municipal corporation for purposes of the debt limitation of Utah Constitution, Article XIV, Section 4.
(10) Notwithstanding any other provision, the board may directly or by resolution delegate to one or more officers of the public infrastructure district the authority to:
(a) in accordance and within the parameters set forth in a resolution adopted in accordance with Section 11-14-302, approve the final interest rate, price, principal amount, maturity, redemption features, and other terms of the bond;
(b) approve and execute any document or contract relating to the issuance of a bond; and
(c) approve any contract related to the acquisition and construction of the improvements, facilities, or property to be financed with a bond.
(11)
(a) Subject to Subsection (11)(b), before a public infrastructure district may issue a limited tax bond or assessment bond, the public infrastructure district shall engage a municipal advisor who, in connection with the issuance of bonds, shall deliver a certificate stating that:
(i) the municipal advisor qualifies to serve as a municipal advisor, as defined in Section 17D-4-102, including the basis for the municipal advisor's qualifications;
(ii) the structure of the limited tax bond or assessment bond the public infrastructure district is about to issue is a reasonable structure, as of the date of the issuance of the limited tax bond or assessment bond, as applicable; and
(iii) the interest rate of the limited tax bond or assessment bond the public infrastructure district is about to offer is a reasonable market rate, as of the date of the issuance of the limited tax bond or assessment bond, as applicable.
(b) The provisions of this Subsection (11) do not apply to a public infrastructure district created by a development authority.
(12)
(a) Any person may contest the legality of the issuance of a public infrastructure district bond or any provisions for the security and payment of the bond for a period of 30 days after:
(i) posting the resolution authorizing the bond as a class A notice under Section 63G-30-102; or
(ii) posting a notice of bond containing substantially the items required under Subsection 11-14-316(2) as a class A notice under Section 63G-30-102.
(b) After the 30-day period described in Subsection (12)(a), no person may bring a lawsuit or other proceeding contesting the regularity, formality, or legality of the bond for any reason.
(13)
(a) In the event of any statutory change in the methodology of assessment or collection of property taxes in a manner that reduces the amounts which are devoted or pledged to the repayment of limited tax bonds, a public infrastructure district may charge a rate sufficient to receive the amount of property taxes or assessment the public infrastructure district would have received before the statutory change in order to pay the debt service on outstanding limited tax bonds.
(b) The rate increase described in Subsection (13)(a) may exceed the limit described in Section 17D-4-303.
(c) The public infrastructure district may charge the rate increase described in Subsection (13)(a) until the bonds, including any associated refunding bonds, or other securities, together with applicable interest, are fully met and discharged.
(14) No later than 60 days after the closing of any bonds by a public infrastructure district created by a bonding political subdivision, as defined in Section 63C-25-101, the public infrastructure district shall report the bond issuance, including the amount of the bonds, terms, interest rate, and security, to:
(a) the Executive Appropriations Committee; and
(b) the State Finance Review Commission created in Section 63C-25-201.
Amended by Chapter 347, 2025 General Session