(1) Except as provided in Section 11-42-702, each local entity that issues assessment bonds shall:

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Terms Used In Utah Code 11-42-701

  • Assessment bonds: means bonds that are:
         (3)(a) issued under Section 11-42-605; and
         (3)(b) payable in part or in whole from assessments levied in an assessment area, improvement revenues, and a guaranty fund or reserve fund. See Utah Code 11-42-102
  • Bonds: means assessment bonds and refunding assessment bonds. See Utah Code 11-42-102
  • Governing body: means :
         (22)(a) for a county, city, or town, the legislative body of the county, city, or town;
         (22)(b) for a special district, the board of trustees of the special district;
         (22)(c) for a special service district:
              (22)(c)(i) the legislative body of the county, city, or town that established the special service district, if no administrative control board has been appointed under Section 17D-1-301; or
              (22)(c)(ii) the administrative control board of the special service district, if an administrative control board has been appointed under Section 17D-1-301;
         (22)(d) for the military installation development authority created in Section 63H-1-201, the board, as defined in Section 63H-1-102;
         (22)(e) for the Utah Inland Port Authority, created in Section 11-58-201, the board, as defined in Section 11-58-102; and
         (22)(f) for a public infrastructure district, the board of the public infrastructure district as defined in Section 17D-4-102. See Utah Code 11-42-102
  • Guaranty fund: means the fund established by a local entity under Section 11-42-701. See Utah Code 11-42-102
  • Jurisdictional boundaries: means :
         (30)(a) for a county, the boundaries of the unincorporated area of the county; and
         (30)(b) for each other local entity, the boundaries of the local entity. See Utah Code 11-42-102
  • Local entity: means :
         (31)(a) a county, city, town, special service district, or special district;
         (31)(b) an interlocal entity as defined in Section 11-13-103;
         (31)(c) the military installation development authority, created in Section 63H-1-201;
         (31)(d) a public infrastructure district under Title 17D, Chapter 4, Public Infrastructure District Act, including a public infrastructure district created by a development authority;
         (31)(e) the Utah Inland Port Authority, created in Section 11-58-201; or
         (31)(f) any other political subdivision of the state. See Utah Code 11-42-102
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Prior bonds: means the assessment bonds that are refunded in part or in whole by refunding assessment bonds. See Utah Code 11-42-102
  • Property: includes real property and any interest in real property, including water rights and leasehold rights. See Utah Code 11-42-102
  • Refunding assessment bonds: means assessment bonds that a local entity issues under Section 11-42-607 to refund, in part or in whole, assessment bonds. See Utah Code 11-42-102
  • State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
     (1)(a) create a guaranty fund, as provided in this section, to secure bonds, to the extent of the money in the fund; and
     (1)(b) fund the guaranty fund by:

          (1)(b)(i) appropriations from the local entity’s general fund;
          (1)(b)(ii) a property tax levy of not to exceed .0002 per dollar of taxable value of taxable property within the local entity’s jurisdictional boundaries;
          (1)(b)(iii) issuing general obligation bonds; or
          (1)(b)(iv) appropriations from other sources as determined by the local entity’s governing body.
(2) A tax levied by a local entity under Subsection (1)(b)(ii) to fund a guaranty fund is not included for purposes of calculating the maximum levy limitation applicable to the local entity.
(3) A local entity may covenant for the benefit of bond holders that, as long as the bonds are outstanding and unpaid, the local entity will:

     (3)(a) create a guaranty fund as provided in this section;
     (3)(b)

          (3)(b)(i) to the extent legally permissible and by any of the methods described in Subsection (1)(b), transfer each year to the guaranty fund an amount of money up to the amount the local entity would collect by levying a tax of .0002 per dollar of taxable value of taxable property within the local entity until the balance in the guaranty fund equals 10% of the amount of all outstanding bonds; and
          (3)(b)(ii) in subsequent years transfer to the guaranty fund the amount necessary to replenish or maintain the guaranty fund at 10% of the amount of all outstanding bonds; and
     (3)(c) invest the funds on deposit in the guaranty fund as provided in Title 51, Chapter 7, State Money Management Act.
(4) A local entity may create subaccounts within a guaranty fund for each issue of outstanding assessment bonds and refunding assessment bonds in a manner that the local entity’s governing body considers appropriate to allocate among the bond issues the securities held in and interest earnings on the guaranty fund for purposes of complying with federal law.
(5) A local entity may transfer to its general fund any money in its guaranty fund that exceeds 10% of the amount of all of the local entity’s outstanding assessment bonds and refunding assessment bonds that are secured by the guaranty fund.
(6) For purposes of Subsections (3)(b) and (5), refunding assessment bonds may not be considered outstanding until the principal of and interest and any redemption premiums on the prior bonds that are refunded by the refunding assessment bonds are fully paid or legally considered to be paid.

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