Each lease agreement between a local building authority and its creating local entity shall:
Terms Used In Utah Code 17D-2-402
Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
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
Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
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
provide for the payment of lease payments sufficient:
(i)
to pay:
(A)
the principal of and interest on local building authority bonds the proceeds of which were used to construct, acquire, improve, or extend the project;
(B)
all fees and expenses of trustees and paying agents for bonds described in Subsection (1)(a)(i)(A); and
(C)
all costs of maintaining and operating the project; and
(ii)
to accumulate any reasonable reserve that the local building authority considers necessary;
(b)
provide that the creating local entity, if not in default under the lease agreement, may:
(i)
subject to Subsection (2), renew the lease for a fixed term beyond the initial term by giving specified notice before the expiration of the initial term; and
(ii)
subject to Subsection (3) and the terms of the lease agreement, purchase the leased property on a date fixed in the agreement;
(c)
provide that a creating local entity under the lease agreement is not under any obligation:
(i)
to purchase the leased property; or
(ii)
to a creditor, shareholder, or security holder of the local building authority; and
(d)
require that:
(i)
title to the project vest in the creating local entity upon payment in full of all outstanding local building authority bonds issued to construct, acquire, improve, or extend a project; and
(ii)
any remaining assets and net earnings of the local building authority be paid to the creating local entity upon dissolution of the local building authority, as provided in Section 17D-2-702.
(2)
The term of a lease agreement under this part, including any renewal of the lease agreement, may not exceed the lesser of:
(a)
the estimated useful life of the project, as certified under Subsection 17D-2-302(1); and
(b)
40 years.
(3)
The purchase price of leased property under Subsection (1)(b)(ii) may not exceed the project costs that the local building authority actually invested in the project.
