Amends TCA Section 9-21-133 and Title 9, Chapter 21, Part 4.

PRINCIPAL DEBT<br /> <br /> Present law provides that for purposes of the evaluation plan for the approval of the comptroller of treasury ("comptroller") required prior to issuance of balloon indebtedness, principal of debt is treated as being payable or amortized upon its stated maturity, upon any mandatory redemption date, and upon any date on which the holder of the debt has the option to require the debt to be prepaid, redeemed, or purchased, other than with the proceeds of a liquidity facility provided by a third party. This bill changes the present law by no longer treating principal debt as being payable or amortized upon any date on which the holder of the debt has the option to require the debt to be prepaid, redeemed, or purchased, other than with the proceeds of a liquidity facility provided by a third party.<br /> <br /> LOCAL GOVERNMENT DEBT ISSUANCE<br /> <br /> This bill requires local governments issuing debt under the Local Government Public Obligations Act of 1986 or the Public Building Authorities Act of 1971 to seek approval from the comptroller or the comptroller's designee prior to issuance if the debt meets one of the following conditions:<br /> <br /> (1) The debt poses a heightened financial risk, as defined by the state funding board, to the local government that is issuing it; or<br /> <br /> (2) The debt is issued by a local government experiencing financial difficulties, as defined by the state funding board. <br /> <br /> This bill requires the state funding board to develop policies that define "debt instruments that pose a heightened financial risk to issuing local governments," define "financial difficulties", and prescribe the required contents of any requests for approval submitted to the comptroller pursuant to this bill.<br />