| (1) |
Subject to this section, restrictions imposed by bond ordinance, or other controlling regulations, the town council may:
Terms Used In Utah Code 10-5-120- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Fund: is a s defined by the Governmental Accounting Standards Board as reflected in the Uniform Accounting Manual for All Local Governments prepared by the Office of the Utah State Auditor. See Utah Code 10-5-102.5
- General fund: is a s defined by the Governmental Accounting Standards Board as reflected in the Uniform Accounting Manual for All Local Governments prepared by the Office of the Utah State Auditor. See Utah Code 10-5-102.5
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- Interfund loan: means a loan of cash from one fund to another, subject to future repayment. See Utah Code 10-5-102.5
- 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
- Town: means a municipality classified by population as a town under Section 10-2-301. See Utah Code 10-1-104
- United States: includes each state, district, and territory of the United States of America. See Utah Code 68-3-12.5
- Writing: includes :Utah Code 68-3-12.5
| (a) |
subject to the restrictions in Section 53-2a-605, authorize an interfund loan from one fund to another; and |
| (b) |
with available cash in any fund, purchase or otherwise acquire for investment an unmatured bond of the town or of any fund of the town. |
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| (2) |
An interfund loan under Subsection (1)(a) shall be in writing and specify the terms and conditions of the loan, including the:
| (a) |
effective date of the loan; |
| (b) |
name of the fund loaning the money; |
| (c) |
name of the fund receiving the money; |
| (e) |
subject to Subsection (3), term of and repayment schedule for the loan; |
| (f) |
subject to Subsection (4), interest rate of the loan; |
| (g) |
method of calculating interest applicable to the loan; |
| (h) |
procedures for:
| (i) |
applying interest to the loan; and |
| (ii) |
paying interest on the loan; and |
|
| (i) |
other terms and conditions the town council determines applicable. |
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| (3) |
The term and repayment schedule specified under Subsection (2)(e) may not exceed 10 years. |
| (4) |
| (a) |
In determining the interest rate of the loan specified under Subsection (2)(f), the town council shall apply an interest rate that reflects the rate of potential gain had the funds been deposited or invested in a comparable investment. |
| (b) |
Notwithstanding Subsection (4)(a), the interest rate of the loan specified under Subsection (2)(f):
| (i) |
if the term of the loan under Subsection (2)(e) is one year or less, may not be less than the rate offered by the Public Treasurers’ Investment Fund that was created for public funds transferred to the state treasurer in accordance with Section 51-7-5; or |
| (ii) |
if the term of the loan under Subsection (2)(e) is more than one year, may not be less than the greater of the rate offered by:
| (A) |
the Public Treasurers’ Investment Fund that was created for public funds transferred to the state treasurer in accordance with Section 51-7-5; or |
| (B) |
a United States Treasury note of a comparable term. |
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| (5) |
| (a) |
For an interfund loan under Subsection (1)(a), the town council shall:
| (i) |
hold a public hearing; |
| (ii) |
prepare a written notice of the date, time, place, and purpose of the hearing, and the proposed terms and conditions of the interfund loan under Subsection (2); |
| (iii) |
provide notice of the public hearing in the same manner as required under Subsection 10-5-108(2) as if the hearing were a budget hearing; and |
| (iv) |
authorize the interfund loan by ordinance or resolution in a public meeting. |
|
| (b) |
The notice and hearing requirements in Subsection (5)(a) are satisfied if the interfund loan is included in an original budget or in a subsequent budget amendment previously approved by the town council for the current fiscal year. |
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| (6) |
Subsections (2) through (5) do not apply to an interfund loan if the interfund loan is:
| (a) |
a loan from the town general fund to any other fund of the town; or |
| (b) |
a short-term advance from the town’s cash and investment pool to individual funds that are repaid by the end of the fiscal year. |
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Amended by Chapter 253, 2014 General Session
