South Carolina General Assembly
107th Session, 1987-1988

Bill 3703


                    Current Status

Bill Number:               3703
Ratification Number:       611
Act Number                 538
Introducing Body:          House
Subject:                   Requirements to issue notes and
                           bonds
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(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A538, R611, H3703)

AN ACT TO AMEND SECTION 31-13-200, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO NOTES AND BONDS ISSUED BY THE STATE HOUSING AUTHORITY, SO AS TO MODIFY THE REQUIREMENTS FOR THE ISSUANCE OF NOTES AND BONDS TO OBTAIN FUNDS TO MAKE PERMANENT MORTGAGE LOANS; TO AMEND ACT 1377 OF 1968, AS AMENDED, RELATING TO THE ISSUANCE OF STATE CAPITAL IMPROVEMENT BONDS, SO AS TO PROVIDE THAT IF ANY JOINT BOND REVIEW COMMITTEE PARTICIPATION UNDER THE ACT IS UNCONSTITUTIONAL, THE RESIDUE OF THE ACT IS CAPABLE OF BEING EXECUTED WITHOUT THE UNCONSTITUTIONAL PROVISION; AND TO DIRECT THE CODE COMMISSIONER TO CHANGE CODE REFERENCES TO THE "SOUTH CAROLINA STATE HOUSING AUTHORITY" TO THE "SOUTH CAROLINA STATE HOUSING FINANCE AND DEVELOPMENT AUTHORITY".

Be it enacted by the General Assembly of the State of South Carolina:

Requirements to issue notes and bonds

SECTION 1. Section 31-13-200(1)(b)(ii) of the 1976 Code is amended to read:

"(ii) permanent mortgage loans to housing sponsors or to persons or families of either beneficiary class who agree to and must be required to provide for construction or rehabilitation of residential housing for rental or purchase by persons or families of either beneficiary class. However, with respect to any particular issue of notes or bonds, one of the following conditions must be met:

a. If there is a public distribution of the notes or bonds, the issue must be rated by one or more of the national rating agencies, and one or more of the following conditions must be met:

i. There must be in effect a federal program providing assistance in the repayment of the loans.

ii. The proceeds must be used to acquire either federally insured mortgages or mortgages insured by a private mortgage insurer authorized to do business in this State .

iii. The payment of the notes or bonds to the purchasers and holders of them must be assured by the maintenance of adequate reserves or insurance or a guaranty from a responsible entity which has been determined to be sufficient by the Authority and by the Budget and Control Board.

b. If the notes or bonds are sold or placed either as 'mortgage bonds sold as a unit,' in 'transactions with banks, institutional buyers, etc.' as provided in Section 35-1-320(5) and (8), the documents pursuant to which the notes or bonds are issued must permit the Authority to avoid any default by it by completing an assignment of, or foregoing its rights with respect to, any collateral or security pledged to secure the notes or bonds."

Issuance of State Capitol Improvement Bonds; unconstitutional provisions

SECTION 2. Section 3 of Act 1377 of 1968, as amended, is amended by adding a new item appropriately lettered to read:

"( ) If any Joint Bond Review Committee participation under this act is unconstitutional, the General Assembly intends that the residue of the act shall remain in full force and effect and is capable of being executed without the unconstitutional provision."

Change references

SECTION 3. The Code Commissioner is directed to change all references in the 1976 Code to the "South Carolina State Housing Authority" to the "South Carolina State Housing Finance and Development Authority".

Time effective

SECTION 4. This act takes effect upon approval by the Governor.