Idaho State Statutes - Idaho Attorney Directory

(1) The
endowment fund investment board shall administer a school district bond credit
enhancement program in accordance with this section and in conjunction with
chapter 53, title 33, Idaho Code, and may promulgate rules to implement it.
This program applies to voter approved bonds issued by school districts. The
program is intended to benefit school districts by purchasing notes issued by
the state of Idaho, whereby the state may guarantee payment of school district
bonded indebtedness in order to avoid an imminent default, providing lower
interest rates at which the bonds may be issued.
(2) A school district that seeks the guarantee of bonds under this
program shall apply to the state treasurer pursuant to section 33-5304, Idaho
Code. The state treasurer shall transmit all approved applications to the
board. The board may challenge an approved application within three (3)
business days of their receipt of the same. If no challenge is issued within
three (3) business days the application shall be deemed approved by the board.
In the event of a challenge in writing to the state treasurer, the treasurer
and the board shall have ten (10) business days to mutually approve the
application. If after a challenge by the board, the application is not
mutually approved within the ten (10) business days, the application shall be
deemed rejected. Nothing contained herein shall prohibit a school district
from reapplying following a rejected application.
(3) Upon approval of the credit enhancement program under this section,
the following shall be in effect in the event moneys from the sales tax
account or from the provisions of section 33-5309, Idaho Code, are
insufficient to pay the principal of and interest on the notes issued by the
state pursuant to section 33-5308, Idaho Code, the endowment fund shall
purchase new notes from the state, in accordance with section 33-5308, Idaho
Code, the proceeds of which shall be sufficient to pay the principal of and
the interest on the original notes as they become due pursuant to section
33-5308, Idaho Code. The new notes shall be subject to the following terms and
conditions:
(a) The notes shall bear interest at a rate equal to an annual rate ten
percent (10%) higher than the average interest earned on the investments
of the public school permanent endowment fund in the four (4) calendar
quarters preceding the quarter in which the loan occurred and if this
figure is not equal to the percentage return of the fund's highest
category of investments in its portfolio, then the interest rate shall
equal that percentage return on investment, plus all additional
administrative costs related to these investments;
(b) The notes, including principal and interest, shall be repaid from the
district's next payments pursuant to chapter 8, title 33, Idaho Code, as
collected by the state treasurer;
(c) The state may make additional payments on the note;
(d) The endowment fund investment board may require the state treasurer
to compel the school district to modify its fiscal practices and its
general operations if the board determines that there is a substantial
likelihood that the district will not be able to make future payments
required under this section.
(4) The provisions of this section shall not be deemed to interfere with
the state treasurer's ability in chapter 53, title 33, Idaho Code, to obtain
repayment of a delinquent obligation.
(5) For purposes of administering the provisions of this section, the
board shall make available the sum of at least two hundred million dollars
($200,000,000) from the public school permanent endowment fund, for purposes
of purchasing notes as authorized by this section. The amount of debt
guaranteed by the credit enhancement program shall not be greater than three
(3) times the amount made available by the public school permanent endowment
fund.

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