A local building authority and its creating local entity may enter into a lease agreement with respect to a project that the local building authority:
Terms Used In Utah Code 17D-2-401
Bond: includes a bond, note, or other instrument issued under this chapter evidencing an indebtedness of a local building authority. See Utah Code 17D-2-102
Creating local entity: means the local entity that creates or created the local building authority. See Utah Code 17D-2-102
Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
Local entity: means a county, city, town, school district, special district, or special service district. See Utah Code 17D-2-102
Project: means an improvement, facility, property, or appurtenance to property that a local entity is permitted under law to own or acquire, whether located inside or outside the local entity's boundary, including:
(a)
a public building or other structure of any kind; and
(b)
a joint or partial interest in the improvement, facility, property, or appurtenance to property. See Utah Code 17D-2-102
has constructed, acquired, improved, or extended on behalf of the creating local entity; or
(b)
will construct, acquire, improve, or extend on behalf of the creating local entity.
(2)
(a)
A local building authority and its creating local entity may enter into a lease agreement before the local building authority’s acquisition of a site or construction of the project.
(b)
Each lease agreement described in Subsection (2)(a) shall:
(i)
provide that the creating local entity is not required to make a lease payment until acquisition or construction of the project is completed; and
(ii)
require the local building authority to furnish or cause the construction contractor to furnish a bond satisfactory to the creating local entity, conditioned upon:
(A)
final completion of the project as expeditiously as reasonably possible from the date of the execution of the lease agreement; and
(B)
delivery of possession of the project to the creating local entity free and clear of all liens and encumbrances, except:
(I)
taxes, liens, and encumbrances on the local building authority’s interest in the leased property; and
(II)
easements and restrictions that the creating local entity accepts.
