The Vermont Statutes Online

Title 32: Taxation and Finance

Chapter 013: Debts and Claims

• Subchapter 001: BORROWING

• § 901. Borrowing money

  The Treasurer shall not make a contract binding the State for money borrowed unless it is countersigned by the Secretary of State. (Amended 2007, No. 121 (Adj. Sess.), § 27.)

• § 902. Authorization to borrow money

  (a) Notwithstanding any other provision of law to the contrary, the State Treasurer, with notification to the Governor, on behalf of the State may borrow on the credit of the State for the purpose of raising funds to pay expenses of government for which appropriations have been made but for which anticipated revenues have not been received, for the purpose of defraying accumulated State deficits, for the purposes authorized by section 955 of this title and for expenses of preparing, issuing, and marketing obligations issued for such purposes. To evidence such borrowing, the State Treasurer is authorized to issue notes or other similar obligations, which shall include notes commonly known as tax exempt commercial paper (notes) from time to time in such form and denominations and with such terms and provisions including the maturity date or dates, redemption provisions, and other provisions necessary or desirable as the State Treasurer shall determine. Such notes shall be non-interest bearing or bear interest at such rate or rates, which may be fixed or variable, as, in the judgment of the State Treasurer, may be sufficient or necessary to effect the issuance and sale or resale thereof in the manner determined by the State Treasurer. The State Treasurer is authorized to enter into such agreements with other persons as he or she deems necessary or appropriate in connection with the issuance, sale, and resale of such notes, including agreements providing liquidity or credit facilities in connection with such notes, and, at his or her discretion, to resell or retire any such notes purchased by the State prior to the stated maturity thereof.

  (b) The State Treasurer shall pay the interest on, principal of and expenses of preparing, issuing, and marketing of such notes as the same fall due without further order or authority from the General Fund or from the Transportation or other applicable funds or from the proceeds of bonds or notes. The authority hereby granted is in addition to and not in limitation of any other authority. Such notes shall be sold at public or private sale with or without published notice, as the State Treasurer may determine to be in the best interests of the State. (Added 1993, No. 19, § 1, eff. May 11, 1993; amended 1995, No. 178 (Adj. Sess.), § 264.)

• Subchapter 002: CLAIMS

• § 931. Repealed. 1997, No. 156 (Adj. Sess.), § 48, eff. April 29, 1998.

• § 932. Claims against the State

  (a) A person who has a claim against the State, the payment of which is not otherwise specially provided for by law, may file a claim in Small Claims Court in accordance with 12 V.S.A. chapter 187. Notwithstanding 12 V.S.A. § 5531(a), judgments on such claims shall not exceed $2,000.00.

  (b) A claim under this section shall be filed within 18 months after the date the claim accrued, and shall not be filed until the claimant has exhausted any duly adopted administrative grievance procedure of the State agency or department against which the claim is made. If the agency or department has not issued a final determination within 90 days after the grievance was filed, then for purposes of a claim under this subchapter, the grievance claim shall be deemed granted. (Amended 1977, No. 94; 1997, No. 156 (Adj. Sess.), § 46, eff. April 29, 1998; 1999, No. 8, § 1.)

• § 932a. Administrative reimbursement for property damages

  (a) In lieu of proceeding under section 932 of this title, a State employee who has a claim against the State for property damages may elect to file a claim under this section, provided the claim does not exceed $1,000.00.

  (b) The claim shall be:

  (1) made in writing, under oath, stating the facts relating to the claim;

  (2) filed with the agency, department, or other State entity that employs the claimant; and

  (3) filed within one year after the date the claim accrued.

  (c) The State entity with which the claim is filed may approve payment of a claim against the State for property damages sustained by the employee and payment of the claim shall be charged against that entity’s departmental appropriation.

  (d) If a claim is approved under this section, the Commissioner of Finance and Management shall issue a warrant for the amount of the award, the acceptance of which shall be a full discharge of all claims against the State arising out of the matters involved in the award. If the claim is disapproved, the person may proceed to file the claim under section 932 of this title.

  (e)(1) A State employee who incurs expenses for legal representation because of a criminal investigation conducted by law enforcement authorities regarding an act or omission within the scope of the employee’s duties, may present an administrative claim to the head of his or her employing agency, provided that the employee has not:

  (A) been convicted of any criminal offense on account of the act or omission;

  (B) been finally terminated by the employing agency; or

  (C) resigned from employment due to the act or omission.

  (2) If the agency head has not yet made a determination whether the employee will be terminated, or if the termination is appealed to the Vermont Labor Relations Board, the request may be held until such a determination has been made or the Board decides the case. An employee reinstated by the Board may present a claim.

  (3) The agency head shall forward the request along with a recommendation to the Secretary of Administration, who may authorize administrative reimbursement from the Agency’s budget for reasonable and necessary expenses, not to exceed $5,000.00. Payment under this subsection may only be authorized upon a finding by the Secretary of Administration that the act or omission was within the scope of the employee’s duties. The decision to reimburse and the amount of reimbursement are matters fully within the Secretary’s discretion. The Secretary’s decision shall be final and there shall be no appeal or challenge of the decision. There shall be no other reimbursement of legal expenses for criminal representation except as authorized under 3 V.S.A. § 1104. (Added 1999, No. 8, § 2; amended 2001, No. 72, § 1; 2021, No. 105 (Adj. Sess.), § 464, eff. July 1, 2022.)

• § 933. Hearing

  (a) Notwithstanding 12 V.S.A. § 5535, claims to the Small Claims Court brought under this subchapter shall be decided by the court with no jury. An appeal from the decision of the Small Claims Court shall be in accordance with provisions of 12 V.S.A. § 5538.

  (b) The Small Claims Court shall decide a claim filed under this subchapter by an inmate of a correctional facility on the basis of affidavits of the parties and testimony by telephone; or the court may in its discretion request additional evidence to decide such claims.

  (c) Upon award of damages by the Small Claims Court, the Commissioner of Finance and Management shall issue a warrant for the amount, the acceptance of which shall be a full discharge of all claims against the State arising out of the matters involved in the award. (Amended 1959, No. 328 (Adj. Sess.), § 8(b); 1981, No. 249 (Adj. Sess.), § 7; 1983, No. 195 (Adj. Sess.), § 5(b); 1997, No. 156 (Adj. Sess.), § 47, eff. April 29, 1998; 2021, No. 105 (Adj. Sess.), § 465, eff. July 1, 2022.)

• § 934. Repealed. 1997, No. 156 (Adj. Sess.), § 48, eff. April 29, 1998.

• § 935. Payment of claims

  The amount paid under this subchapter shall be charged to the State agency responsible for the basis of the claim; otherwise, it shall be paid from the contingent fund.

• Subchapter 003: STATE BONDS

• § 951. Applicability

  This subchapter shall apply to all bonds authorized by the General Assembly, provided that provisions in authorizing acts inconsistent with this subchapter shall control, except as provided in section 957 of this title. (Added 1959, No. 24, § 1, eff. March 10, 1959; amended 2021, No. 105 (Adj. Sess.), § 466, eff. July 1, 2022.)

• § 951a. Debt service funds

  (a) Three governmental debt service funds are hereby established:

  (1) the General Obligation Bonds Debt Service Fund to fulfill debt service obligations of general obligation bonds from all funding sources;

  (2) the Transportation Infrastructure Bonds Debt Service Fund to fulfill debt service obligations of transportation infrastructure bonds funded primarily by the revenues of the Transportation Infrastructure Bond Fund; and

  (3) other debt service funds to fulfill debt service obligations of other long-term debt funded by governmental fund dedicated revenue sources.

  (b) Financial resources in each fund shall consist of appropriations by the General Assembly to fulfill debt service obligations, the transfer of funding sources by the General Assembly to fulfill future debt service obligations, bond proceeds raised to fund a permanent reserve required by a trust agreement entered into to secure bonds, transfers of appropriations effected pursuant to section 706 of this title, investment income earned on balances held in trust agreement accounts as required by a trust agreement, and such other amounts as directed by the General Assembly or that are specifically authorized by provisions of this title. Each debt service fund shall account for the accumulation of resources and the fulfillment of debt service obligations within the current fiscal year and the accumulation of resources for debt service obligations maturing in future fiscal years.

  (c) Debt service obligations of general obligation bonds, transportation infrastructure bonds, or other authorized long-term obligations shall be fulfilled from the respective governmental debt service funds established in this section.

  (d) As used in this section, “debt service obligations” of bonds include requirements to:

  (1) pay principal and interest, sinking fund obligations, and redemption premiums;

  (2) pay investment return on and the maturity value of capital appreciation bonds;

  (3) provide for reserves required by a trust agreement entered into to secure bonds; and

  (4) provide any additional security, insurance, or other form of credit enhancement required by a trust agreement entered into to secure bonds. (Added 2011, No. 63, § F.101, eff. June 2, 2011.)

• § 952. Denominations; how issued

  The bonds may be issued at one time or in series from time to time, in any form permitted by law. Except for zero coupon bonds or capital appreciation bonds designated as such by the State Treasurer, with the approval of the Governor, each series shall be payable in substantially equal or diminishing amounts annually, the first of the annual payments to be made not later than five years after the date of the bonds and the last of the payments to be made not later than 20 years after the date. All bonds shall mature not later than 20 years after the date of the bonds. The principal, interest, investment returns, and maturity value of the bonds shall be payable in lawful money of the United States or of the country in which the bonds were sold and for the payments the full faith and credit of the State are hereby pledged. Bonds shall be signed by the State Treasurer or the State Treasurer’s deputy and countersigned by the manual or facsimile signature of the Secretary of State or the Secretary of State’s deputy, and shall bear the Seal of the State or a facsimile of the Seal of the State, and the interest coupons on the bonds shall bear the facsimile signature of the State Treasurer. Bonds shall be registered as provided by this subchapter. The date of issuance; place of payment; rate of interest, which may be fixed or variable; or the manner of determining the rate of interest, original stated value, investment returns or manner of determining the same, maturity value, time of maturity, provisions with respect to redemption prior to maturity, at par or at a premium, sinking fund and reserve requirements, and other particulars as to the form of the bonds, within the limitations mentioned under this section, shall be determined by the State Treasurer with the approval of the Governor as the State Treasurer may deem for the best interests of the State. Bonds shall contain on their face the statement that they are issued for the purposes mentioned in, under the authority of, and in conformity with the authorizing act, and that their form and other particulars and details have been duly determined by the State Treasurer, with the approval of the Governor; and the statement shall be conclusive evidence of the liability of the State to any bona fide holder, and the bonds so issued shall be the lawful obligations of the State. (Added 1959, No. 24, § 2, eff. March 10, 1959; amended 1979, No. 205 (Adj. Sess.), § 156, eff. May 9, 1980; 1985, No. 125 (Adj. Sess.), § 1, eff. April 18, 1986; 1989, No. 276 (Adj. Sess.), § 22, June 20, 1990; 1993, No. 19, § 2, eff. May 11, 1993; 2021, No. 105 (Adj. Sess.), § 467, eff. July 1, 2022.)

• § 953. Sales, record

  The State Treasurer, with the approval of the Governor, is hereby authorized to sell such bonds at such prices, in such amount, at such times, and in such manner, with or without advertising the same, as he or she shall determine to be for the best interests of the State, at public or private sale. The State Treasurer shall keep an accurate record of each and every bond when issued, the number and denomination of each bond when issued, when and where payable, to whom sold, and the rate of interest or the investment return thereon and shall keep an accurate record of all payments of interest, principal, investment return, and maturity value. Interest and the investment return on such bonds shall be exempt from taxation in this State. (Added 1959, No. 24, § 3, eff. March 10, 1959; amended 1989, No. 276 (Adj. Sess.), § 23, eff. June 20, 1990.)

• § 954. Proceeds

  (a) The proceeds arising from the sale of bonds, inclusive of any premiums, shall be applied to the purposes for which they were authorized, and the purposes shall be considered to include the expenses of preparing, issuing, and marketing the bonds and any notes issued under section 955 of this title, and amounts for reserves, but no purchasers of the bonds shall be in any way bound to see to the proper application of the proceeds. The State Treasurer shall pay the interest on, principal of, investment return on, and maturity value of the bonds and notes as the same fall due or accrue without further order or authority. The State Treasurer, with the approval of the Governor, may establish sinking funds, reserve funds, or other special funds of the State as the State Treasurer may deem for the best interests of the State. To the extent not otherwise provided, the amount necessary each year to fulfill the maturing principal and interest of, investment return and maturity value of, and sinking fund installments on all the bonds then outstanding shall be included in and made a part of the annual appropriation bill for the expense of State government, and the principal and interest on, investment return and maturity value of, and sinking fund installments on the bonds as may come due before appropriations for their fulfillment have been made shall be fulfilled from the applicable debt service fund.

  (b) The State Treasurer is authorized to allocate the estimated cost of bond issuance or issuances to the entities to which funds are appropriated by a capital construction act and for which bonding is required as the source of funds. If estimated receipts are insufficient, the State Treasurer shall allocate additional costs to the entities. Any remaining receipts shall not be expended, but carried forward to be available for future capital construction acts. If the source of funds appropriated by a capital construction act is other than by issuance of bonds, the State Treasurer is authorized to allocate the estimated cost of ongoing debt management services to the entities to which those funds are appropriated.

  (c) Notwithstanding any other provisions of law, the State Treasurer, with the approval of the Secretary of Administration, is hereby authorized to transfer to any authorized projects unspent proceeds derived from the sale of State bonds or notes previously issued for projects previously authorized, and the State Treasurer is hereby further authorized to issue bonds or notes of the State to replenish such transferred funds for application to the original authorized capital projects. (Added 1959, No. 24, § 4, eff. March 10, 1959; amended 1961, No. 157, eff. June 14, 1961; 1989, No. 276 (Adj. Sess.), § 24, eff. June 20, 1990; 1995, No. 185 (Adj. Sess.), § 41a, eff. May 22, 1996; 1999, No. 29, § 22, eff. May 19, 1999; 2001, No. 61, § 32, eff. June 16, 2001; 2001, No. 149 (Adj. Sess.), § 19, eff. June 21, 2002; 2009, No. 33, § 63; 2011, No. 63, § F.102, eff. June 2, 2011; 2011, No. 104 (Adj. Sess.), § 34, eff. May 7, 2012; 2021, No. 105 (Adj. Sess.), § 468, eff. July 1, 2022.)

• § 955. Anticipation of proceeds

  Pending the issue of said bonds, the State Treasurer, with the approval of the Governor, may use any available cash in the Treasury for the purposes for which the bonds were authorized and restore the same from the proceeds of said bonds. Also, the State Treasurer, with the approval of the Governor, may borrow upon notes of the State sums of money in anticipation of the proceeds of the bonds. Such notes shall be issued on such terms and at such times as they may determine. Each such note shall mature not more than two years from its date, provided that notes issued for a shorter period may be refunded from time to time by the issue of other such notes maturing within the required period of two years. The authority hereby granted is in addition to and not in limitation of any other authority. (Added 1959, No. 24, § 5, eff. March 10, 1959; amended 1993, No. 19, § 3, eff. May 11, 1993.)

• § 956. Time available

  Unless otherwise specifically provided as to any particular appropriation to be raised by the issue of bonds, provisions of law relating to the lapse of unexpended appropriations shall not apply. (Added 1959, No. 24, § 6, eff. March 10, 1959.)

• § 957. Consolidation

  The bonds authorized by one or more acts of the General Assembly may in the discretion of the officers issuing the bonds be combined upon their issue into one or more consolidated issues. The particular bonds of the consolidated issue issued under each authority may but need not be designated by number or otherwise. The bonds of the consolidated issues may be designated by titles as may be deemed appropriate by the officers, which shall be in substitution for any titles prescribed by the authorizing acts, and shall contain on their face the statement that they are issued for the purposes mentioned in, under the authority of, and in conformity with the authorizing acts instead of the statement prescribed above or in the authorizing act, and the statement shall be conclusive evidence of the liability of the State to any bona fide holder, and the bonds so issued shall be the lawful obligations of the State. (Added 1959, No. 24, § 7, eff. March 10, 1959; amended 2021, No. 105 (Adj. Sess.), § 469, eff. July 1, 2022.)

• § 958. Expiration of office

  Any bonds or notes issued pursuant to this subchapter, if properly executed by the officers of the State in office on the date of the signing or on the date of imprinting of the facsimile signature, as the case may be, shall be valid and binding according to their terms, notwithstanding that before their delivery and payment, any or all executing officers shall have for any reason ceased to hold office. (Added 1959, No. 24, § 8, eff. March 10, 1959; amended 2021, No. 105 (Adj. Sess.), § 470, eff. July 1, 2022.)

• § 959. Repealed. 1989, No. 52, § 17(a), eff. May 17, 1989.

• § 960. Issuance of bonds

  Issuance of bonds authorized by the General Assembly for a given fiscal year may, in the discretion of the State Treasurer with the approval of the Governor, be issued in the months of May or June preceding that fiscal year, or at any time thereafter and until such authorization is rescinded by the General Assembly prior to the issuance of such bonds. (Added 1981, No. 233 (Adj. Sess.), § 14(c); amended 1999, No. 148 (Adj. Sess.), § 87, eff. May 24, 2000.)

• § 961. Refunding bonds

  (a) The State Treasurer, with the approval of the Governor, is hereby authorized to issue general obligation bonds in order to refund all or any portion of one or more issues of outstanding general obligation bonds at any time after the issuance of the bonds to be refunded. The State Treasurer, with the approval of the Governor, is authorized to refinance outstanding certificates of participation or outstanding long-term lease purchase agreements through the issuance of general obligation bonds or notes of the State of Vermont or certificates of participation. To the extent available, any reduction in debt service coming from the refunding shall be used to offset General Fund debt service in the fiscal year of the reductions.

  (b) The State Treasurer, prior to the issuance of refunding bonds, shall have authority to contract on behalf of the State with a bank or trust company authorized to do business in this State for the purpose of having the bank or trust company act as the escrow agent of the proceeds, inclusive of any premium, from the sale of the refunding bonds, together with all income derived from the investment of the proceeds, and any other monies to be provided by the State to effectuate the refunding.

  (c) The proceeds, inclusive of any premium, from the sale of refunding bonds, immediately upon receipt, shall be placed in escrow with the escrow agent in accordance with the escrow contract. That portion of the proceeds required for the payment of the principal of and interest on or investment return or maturity value of the bonds to be refunded, including any redemption premiums, shall be irrevocably committed and pledged to that purpose and the holders of the bonds to be refunded shall have a lien upon the monies and investments held by the escrow holder. The pledge and lien provided for in this subsection shall become valid and binding upon the issuance of the refunding bonds and the monies and investments held by the escrow agent shall immediately be subject to the pledge and lien without any further act. The pledge and lien shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the State, irrespective of whether the parties have received notice. Neither the escrow contract, nor any other instrument relating to the pledges and liens, need be filed or recorded.

  (d) The refunding bonds authorized by this section shall be issued in accordance with the provisions of this chapter, provided that installments on refunding bonds need not be payable in substantially equal or diminishing amounts and provided further that no notes may be issued in anticipation of the proceeds of the refunding bonds.

  (e) [Repealed.] (Added 1985, No. 125 (Adj. Sess.), § 2, eff. April 18, 1986; amended 1989, No. 276 (Adj. Sess.), §§ 25, 28, eff. June 20, 1990; 1995, No. 185 (Adj. Sess.), § 65, eff. May 22, 1996; 2021, No. 105 (Adj. Sess.), § 471, eff. July 1, 2022.)

• § 962. Private use compliance, notice, and approval

  Any entity receiving an appropriation financed with proceeds of tax-exempt bonds of the State shall notify and receive approval from the State Treasurer and the Secretary of Administration at least 90 days prior to finalizing an agreement with a nonpublic or for-profit entity to rent, lease, sell, or otherwise dispose of property financed with those proceeds and also shall pay any cost related to compliance with the Internal Revenue Code of 1986, as amended, resulting from disposal of the property. This notification requirement shall not apply if the proceeds were included in the five percent allowance for private use prior to the issuance of bonds, or if the proceeds were provided, or the property was disposed of, as a grant or otherwise with no payment or repayment made or required to be made to the State or to the entity. (Added 2011, No. 104 (Adj. Sess.), § 35, eff. May 7, 2012.)

• Subchapter 004: TRANSPORTATION INFRASTRUCTURE BONDS

• § 971. Repealed. 1966, No. 32, § 3.

• § 972. Transportation Infrastructure Bonds

  (a) The Treasurer may issue bonds pursuant to this subchapter from time to time in amounts authorized by the General Assembly in its annual transportation bill. Bonds issued under this section shall be referred to as “Transportation Infrastructure Bonds.”

  (b) As used in this subchapter, the term “debt service obligations” is as defined in section 951a of this title.

  (c) Debt service obligations of the bonds shall be fulfilled or satisfied in accordance with the terms of any trust agreement pertaining to the bonds from the Transportation Infrastructure Bonds Debt Service Fund.

  (d) Funds raised from bonds issued under this section may be used to pay for or fund:

  (1) the rehabilitation, reconstruction, or replacement of State bridges and culverts;

  (2) the rehabilitation, reconstruction, or replacement of municipal bridges and culverts;

  (3) the rehabilitation, reconstruction, or replacement of State roads, railroads, airports, and necessary buildings that after such work, have an estimated minimum remaining useful life of 30 years or more; and

  (4) a permanent reserve required by a trust agreement entered into to secure the bonds.

  (e) Pursuant to section 953 of this title, interest and the investment return on the bonds shall be exempt from taxation in this State.

  (f) Bonds issued under this section shall be legal investments for all persons without limit as to the amount held, regardless of whether they are acting for their own account or in a fiduciary capacity. The bonds shall likewise be legal investments for all public officials authorized to invest in public funds. (Added 2009, No. 50, § 28; amended 2011, No. 63, § F.103, eff. June 2, 2011.)

• § 973. Issuance of bonds

  (a) Transportation Infrastructure Bonds may be issued at one time or in a series from time to time in any form permitted by law, in such manner and on such terms and conditions as the State Treasurer may determine to be in the best interests of the State, except that the State Treasurer shall determine the following with the approval of the Governor:

  (1) date of issuance;

  (2) place of payment;

  (3) rate of interest (which may be fixed or variable) or the manner of determining such rate of interest;

  (4) original stated value;

  (5) investment returns or manner of determining the investment returns;

  (6) maturity value, time of maturity, and provisions with respect to redemption prior to maturity;

  (7) whether to issue the bonds at par, premium, or discount;

  (8) sinking fund and reserve requirements;

  (9) amount and manner of issuance; and

  (10) other particulars as to the form of such bonds within the limitations of this subchapter.

  (b) The State Treasurer shall determine the annual payment schedule for the bonds, including debt service and sinking fund payments, if any, as he or she may deem to be in the best interests of the State. However, any bond issued under this subchapter shall mature not later than 30 years after the date of issuance. Installments on the bonds need not be payable in substantially equal or diminishing amounts. The last bond payment shall be made not later than 30 years after the date of issuance.

  (c) The State Treasurer may determine at the time of issuance to apply all or a portion of any net premium to the costs of issuance, other related financing costs, or the payment of the principal or interest to come due. If net premium is applied to costs of issuance, the amount of the premium shall not be included in the net proceeds of the issue. Net premium not applied to costs of issuance shall be included in the net proceeds of the issue and may be used for any of the authorized purposes of the bond proceeds.

  (d) The debt service obligations of Transportation Infrastructure Bonds which require a cash payment shall be payable in lawful money of the United States or of the country in which the bonds are sold.

  (e) Transportation Infrastructure Bonds shall be registered pursuant to section 981 of this title. (Added 2009, No. 50, § 28; amended 2011, No. 63, § F.104, eff. June 2, 2011.)

• § 974. Security documents

  (a) The State Treasurer is authorized to secure bonds authorized under this subchapter by a trust agreement that pledges or assigns monies in the Transportation Infrastructure Bond Fund, by additional security, insurance, or other forms of credit enhancement that may be secured with the bonds on a parity or subordinate basis, or by both.

  (b) Any trust agreement or credit enhancement agreement entered into pursuant to this section shall be valid and binding from the time of the agreement without any physical delivery or further act and without any filing or recording under the Uniform Commercial Code or otherwise, and the lien of such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise, irrespective of whether such parties have notice thereof.

  (c) Any trust agreement or credit enhancement agreement may establish provisions defining defaults and establishing remedies and other matters relating to the rights and security of the holders of the bonds or other secured parties as determined by the State Treasurer, including provisions relating to the establishment of reserves; the issuance of additional or refunding bonds, whether or not secured on a parity basis; the application of receipts, monies, or funds pledged pursuant to the agreement; and other matters deemed necessary or desirable by the State Treasurer for the security of the bonds, and may also regulate the custody, investment, and application of monies.

  (d) For payment of debt service obligations of Transportation Infrastructure Bonds, the full faith and credit of the State is hereby pledged. However, if pledging of full faith and credit of the State is not necessary to market a Transportation Infrastructure Bond in the best interests of the State, the Treasurer shall enter into an agreement that establishes that the full faith and credit of the State is not pledged for payment of debt service obligations of the bond. In determining whether to pledge the full faith and credit of the State, the State Treasurer shall consider the anticipated effect of such a pledge on the credit standing of the State, the marketability of the Transportation Infrastructure Bond, and other factors he or she deems appropriate. (Added 2009, No. 50, § 28; amended 2011, No. 63, § F.105, eff. June 2, 2011.)

• § 975. Proceeds

  Proceeds from the sale of bonds may be expended for the authorized purposes of the bonds, including the expenses of preparing, issuing, and marketing the bonds; any notes issued under section 976 of this title; and amounts for any reserves. However, no purchasers of the bonds shall be bound to see to the proper application of the proceeds thereof. (Added 2009, No. 50, § 28; amended 2011, No. 63, § F.106, eff. June 2, 2011.)

• § 975a. Authority of Treasurer

  The Treasurer may fulfill debt service obligations of bonds issued under this subchapter as they fall due without further order or authority. All such fulfillments shall be accounted for as a payment or provision made from the Transportation Infrastructure Bonds Debt Service Fund. (Added 2011, No. 63, § F.107, eff. June 2, 2011.)

• § 975b. Debt service appropriations

  The General Assembly shall appropriate in the annual appropriations bill the amount necessary from the appropriate funds to pay the debt service obligations of Transportation Infrastructure Bonds that are due in the fiscal year covered by the appropriations bill. (Added 2011, No. 63, § F.108, eff. June 2, 2011.)

• § 976. Anticipation of proceeds

  (a) Pending the issue of Transportation Infrastructure Bonds, the State Treasurer, with the approval of the Governor, may use any available cash in the Transportation Infrastructure Bond Fund for the purposes for which the bonds were authorized, and shall restore the borrowed funds from the proceeds of the bonds.

  (b) The State Treasurer, with the approval of the Governor, may borrow upon notes of the State sums of money in anticipation of the proceeds of the bonds. Notes issued under this subsection shall be issued on such terms and at such times as the Treasurer and Governor may determine, and shall mature not more than three years from the date of issuance, provided that notes issued for a shorter period may be refunded from time to time by the issue of other such notes maturing within the required period of three years.

  (c) The authority granted under this section is in addition to and not in limitation of any other authority. (Added 2009, No. 50, § 28.)

• § 977. Refunding bonds

  The State Treasurer, with the approval of the Governor, is hereby authorized to issue Transportation Infrastructure Bonds in order to refund all or any portion of outstanding transportation bonds at any time after the issuance of the bonds to be refunded pursuant to subsections 961(b), (c), and (d) of this title. (Added 2009, No. 50, § 28.)

• § 978. Pledge

  The General Assembly hereby pledges and covenants with holders of the bonds issued under this subchapter that the State will fulfill the terms of any agreement made with the holders of Transportation Infrastructure Bonds and will not in any way impair the rights or remedies of the holders of the bonds until the bonds, interest, and all costs associated with the bonds are fully paid. (Added 2009, No. 50, § 28.)

• § 979. Authorities

  In addition to the provisions of this subchapter, the following provisions of this title shall apply to Transportation Infrastructure Bonds:

  (1) sections 951a, 953, 956, 958, and 960;

  (2) subsection 954(c), except that transfers shall be made only among projects to be funded with Transportation Infrastructure Bonds; and

  (3) section 957, except that consolidation may be only among Transportation Infrastructure Bonds, and the bonds shall be the lawful obligation of the Transportation Infrastructure Bond Fund and not of the remaining revenues of the State unless the Treasurer has agreed to pledge the full faith and credit of the State pursuant to subsection 974(d) of this title. (Added 2009, No. 50, § 28; amended 2011, No. 63, § F.109, eff. June 2, 2011.)

• § 980. Authority to issue Transportation Infrastructure Bonds

  The State Treasurer is authorized to issue Transportation Infrastructure Bonds pursuant to section 972 of this title for the purpose of funding future appropriations only as approved by the General Assembly. (Added 2009, No. 50, § 28.)

• Subchapter 005: FORM OF BONDS AND NOTES

• § 981. Form of bonds or notes

  Notwithstanding any general or special law to the contrary, the State may issue bonds or notes in coupon form payable to the bearer, in registered form without coupons, or in book entry form. Bonds or notes other than those in book entry form shall be signed by the manual or facsimile signature of the State Treasurer or the State Treasurer’s deputy and countersigned by the manual or facsimile signature of the Secretary of State or the Secretary of State’s deputy, and the interest coupons on the bonds or notes, if any, shall bear the facsimile signature of the State Treasurer. The Seal of the State shall be affixed or imprinted on the bonds or notes. The date of issuance; place of payment; rate of interest, which may be fixed or variable, or manner of determining the rate of interest; original stated value; investment returns or manner of determining the same; maturity value; time of maturity; provisions with respect to redemption prior to maturity, at par or at a premium; sinking fund and reserve requirements; and other particulars as to the form of the bonds within the limitations mentioned under this section, shall be determined by the State Treasurer with the approval of the Governor as the State Treasurer may deem for the best interests of the State. (Added 1983, No. 15, eff. March 29, 1983; amended 1989, No. 276 (Adj. Sess.), § 26, eff. June 20, 1990; 1993, No. 19, § 4, eff. May 11, 1993; 2021, No. 105 (Adj. Sess.), § 472, eff. July 1, 2022.)

• § 982. Transfer agent

  The State Treasurer shall act as transfer agent or registrar for the exchange or transfer of registered bonds or notes or maintain the records so that bonds or notes in book entry form may be effected or contract with or otherwise designate a bank, trust company, or other person to act as transfer agent or registrar for the bonds or notes or maintain the records so that bonds or notes in book entry form may be effected. Such bank, trust company, or other person, which may include the federal government or any of its agencies or instrumentalities, or any officer, agency, or instrumentality of the State, may be located or have its principal office inside or outside the State; provided, however, that any such transfer agent or registrar (other than the federal government or any of its agencies or instrumentalities) not domiciled in the State or having its principal business in the State, shall qualify and be authorized to do business in the State, or shall otherwise render itself amenable to personal service of process in the State and shall submit itself to personal jurisdiction in the courts of the State. Bonds or notes in book entry form shall be effected by means of entries on the records of the State Treasurer or his or her designee which shall reflect the description of the issue, the principal amount, maturity value, the interest rate, investment returns, the maturity date, the owner of the bonds or notes, and such other information as is deemed appropriate. The State Treasurer or other designated person may effect conversions between book entry bonds or notes and registered bonds or notes for owners of bonds or notes who request such a change. The State Treasurer or other designated transfer agent or registrar shall issue a confirmation of the transaction in the form of a written advice. (Added 1983, No. 15, eff. March 29, 1983; amended 1989, No. 276 (Adj. Sess.), § 27, eff. June 20, 1990.)

• § 983. Confidential registry

  The books of registry held by the State Treasurer or other designated registrar shall be confidential and the information contained in the books of registry shall not be available to the public. (Added 1983, No. 15, eff. March 29, 1983; amended 2021, No. 105 (Adj. Sess.), § 473, eff. July 1, 2022.)

• § 984. Additional powers

  The State Treasurer or his or her designee shall have such additional powers as are necessary to effectuate the purposes of this subchapter. (Added 1983, No. 15, eff. March 29, 1983.)

• § 985. Application

  This subchapter supersedes any existing general or special law of the State with respect to the matters contained under this subchapter as they apply to bonds or notes issued by the State, but shall not diminish or restrict any powers previously granted by law. (Added 1983, No. 15, eff. March 29, 1983; amended 2021, No. 105 (Adj. Sess.), § 474, eff. July 1, 2022.)

• Subchapter 006: PRIVATE ACTIVITY BONDS

• § 991. Definitions

  As used in this subchapter:

  (1) “Private activity bond” shall have the meaning ascribed to it in Section 141 of the Internal Revenue Code of 1986, as amended. The use of such term in this subchapter is for reference purposes only, and shall not imply that the State of Vermont agrees that any bond issued in accordance with such section is for a “private activity.”

  (2) “Issuing authority” means any agency or governmental unit or instrumentality of the State, or any public corporation established by the State, authorized by law to issue private activity bonds, including municipal corporations. It shall include, without limiting the generality of the foregoing, the Vermont Economic Development Authority, the Vermont Housing Finance Agency, the Vermont Municipal Bond Bank, and the Vermont Student Assistance Corporation. (Added 1985, No. 25, § 1; amended 1987, No. 36, § 1, eff. Jan. 1, 1988; 1993, No. 89, § 3(a), eff. June 15, 1993.)

• § 992. Allocation; authority

  (a) The State of Vermont hereby elects, under Section 146 of the Internal Revenue Code of 1986, as amended, to establish its formula for allocating the State ceiling among the governmental units of a state having authority to issue “private activity bonds” the interest on which is not included in gross income of recipients thereof for federal income tax purposes. The State allocation formula established under this subchapter shall apply to all private activity bonds that all issuing authorities may issue in any calendar year.

  (b)(1) One hundred percent of Vermont’s federally allocated State ceiling on the volume of private activity bonds that may be issued in any calendar year is hereby allocated to the State. The Emergency Board established by chapter 3 of this title shall be the duly authorized agency of the State having the power to apportion the State’s private activity bond ceiling to and among the constituted issuing authorities empowered to issue such bonds. The Emergency Board shall exercise this power on or before January 31 in each calendar year by apportioning the ceiling among issuing authorities, reserving such portion as the Board deems appropriate in the form of a contingency allocation to be available to all issuing authorities at the discretion of the Emergency Board, pursuant to policies and guidelines established by the Board.

  (2) The Board may delegate the power and authority granted to it under this section to the Governor, subject to the Board’s policies and guidelines, for any assignments or reallocations of any unused portion of the ceiling made after December 20 in any calendar year. All assignments or reallocations of the private activity bond ceiling made pursuant to this section shall be made in writing in accordance with Section 146 of the Internal Revenue Code of 1986. (Added 1985, No. 25, § 1; amended 1987, No. 36, § 2, eff. May 11, 1987; 2017, No. 74, § 135.)

• § 993. Public approval, out-of-state issuers

  Notwithstanding any provision to the contrary in Title 9, the Governor, in consultation with the State Treasurer, shall have exclusive authority to grant any public approval required under Section 147(f)(2) of the Internal Revenue Code of 1986, as amended, pertaining to the proposed issuance of qualified private activity bonds when the purpose of the bonds is to finance or refinance purposes to be located within the State and the bonds are proposed by any issuers of qualified private activity bonds organized under the laws of a jurisdiction other than the State of Vermont. Approval shall not be withheld unless the Governor, in consultation with the State Treasurer, determines in good faith that the issuance is not financially sound. (Added 2011, No. 104 (Adj. Sess.), § 36, eff. May 7, 2012.)

• § 994. Recommendation regarding private bond volume cap

  The Treasurer shall, in coordination with the Secretary of Administration, the Secretary of Commerce and Community Development, and any bond issuing authority of the State or instrumentality of the State that is eligible to issue private activity bonds:

  (1) annually survey the expected need for private activity bond allocations and provide recommendations to the Emergency Board prior to its meetings;

  (2) maintain guidelines for allocation of private activity bonding capacity designed to maximize the availability of tax-exempt financing among various sectors of the Vermont economy with a focus on economic development, housing, education, redevelopment, public works, energy, waste management, waste and recycling collection, transportation, and other activities that benefit the citizens of Vermont which guidelines should support efforts and entities that increase the number of good-paying jobs in the State, promote economic development, support affordable housing, and affordable access to postsecondary education and training, and encourage the use of Vermont’s human and natural resources in endeavors that maximize Vermont’s comparative economic advantages, and be flexible enough to include new and innovative uses of private activity bonds, consistent with federal regulations and the Internal Revenue Code;

  (3) on or before December 1 of each year, shall make recommendations to the Emergency Board on the allocation, including any amounts reserved for contingency allocations, of the State’s private activity bond ceiling for the following calendar year to and among the constituted issuing authorities empowered to issue such bonds; and

  (4) as required, or at the request of the Governor or the Emergency Board, make recommendations to the Governor or Emergency Board concerning assignments or reallocation of any unused portion of the ceiling subsequent to an allocation by the Emergency Board in a given year. (Added 2011, No. 110 (Adj. Sess.), § 1, eff. May 8, 2012; amended 2013, No. 1, § 98; 2021, No. 105 (Adj. Sess.), § 475, eff. July 1, 2022; 2023, No. 53, § 139, eff. June 8, 2023.)

• Subchapter 007: FEDERAL TAXATION OF INTEREST

• § 995. Agreements for the exemption of interest

  (a) It is hereby found and determined that proposed amendments to the Internal Revenue Code of 1986, including, particularly, 26 U.S.C. § 103, and the relevant regulations of the U.S. Treasury Department, require the State, municipal corporations, and agencies and instrumentalities thereof, collectively referred to as “Issuers,” to enter into agreements, make covenants with the holders of their respective obligations, or take other actions as a condition to the noninclusion of interest on their respective obligations in gross income of recipients for federal income tax purposes. It is hereby further found and determined that it is in the best interests of the issuers to leave no ambiguity as to whether the issuers have the authority to enter into such agreements, make the covenants, or take other actions.

  (b) Issuers are hereby authorized and empowered to enter into any agreement, make any covenant, or take any other action required to assure that interest on their respective bonds is not included in gross income of the recipients for federal income tax purposes.

  (c) Notwithstanding the provisions of 24 V.S.A. §§ 4648 and 1753 and section 954 of this title, or any other general, special, or local law to the contrary, issuers are hereby authorized to appropriate and pay to the U.S. Treasury Department, or any other agency of the United States, all or a portion of the income received by the issuers from the investment or reinvestment of the proceeds of their respective bonds, in the amount and to the extent necessary to assure that interest on their respective bonds is not included in gross income of the recipients for federal income tax purposes. (Added 1985, No. 125 (Adj. Sess.), § 4, eff. April 18, 1986; amended 1987, No. 36, § 3, eff. May 11, 1987; 2021, No. 105 (Adj. Sess.), § 476, eff. July 1, 2022.)

• § 996. Delegation authorized

  The legislative branch of a municipality or county, however defined, may delegate to the treasurer or chief fiscal officer of a municipal corporation the power to enter into any agreement, make any covenant, or take any other action described in section 995 of this title. The State Treasurer may delegate to the treasurer or chief financial officer of any State instrumentality the power to enter into any agreement, make any covenant, or take any other action described in section 995 of this title. (Added 1985, No. 125 (Adj. Sess.), § 4, eff. April 18, 1986; amended 1987, No. 36, § 4, eff. May 11, 1987.)

• § 997. State covenant

  To the extent that an issuer has entered into an agreement, covenanted, or acted to assure that interest on its obligations is not included in the gross income of the recipients for federal income tax purposes pursuant to this chapter, the State will not limit or alter the power to perform the agreement or covenant or take action or in any way impair the rights and remedies of any holders, until the bonds, together with the interest on the bonds, and all costs and expenses in connection with any action or proceeding by or on behalf of the holders, are fully paid and discharged. Issuers are hereby authorized to include this pledge and agreement of the State in any agreement with the holders of their respective obligations. (Added 1985, No. 125 (Adj. Sess.), § 4, eff. April 18, 1986; amended 1987, No. 36, § 5, eff. May 11, 1987; 2021, No. 105 (Adj. Sess.), § 477, eff. July 1, 2022.)

• § 998. Loans and grants

  In the event the State Treasurer issues bonds the interest on which is not to be included in gross income for federal income tax purposes, to the extent that such funds are made available to any municipal corporation, any instrumentality thereof or of the State, or to any other person, the State Treasurer may require the recipients of the funds to enter into agreements regulating the use and investments of funds made available to them, requiring them to account to the State for the investment of such funds, and requiring them to pay to the State earnings on such funds which the State is required to rebate to the federal government. Recipients are authorized to enter into such agreements with the State which shall be valid and enforceable against them. (Added 1987, No. 36, § 6, eff. May 11, 1987.)

• § 999. Interest remittance and payments

  The State Treasurer may remit to the U.S. Treasury Department or any other agency of the United States funds earned on investments as necessary in order to maintain the noninclusion of interest on the General Fund obligations and the Transportation Fund obligations authorized by the General Assembly in the gross income of recipients thereof. Such remittances may be made from funds appropriated for debt service interest. If those appropriations become insufficient to meet interest and other related payments, subject to the approval of the Emergency Board, there is appropriated such amounts as may be necessary to eliminate the insufficiency in the State appropriations for interest. (Added 1995, No. 178 (Adj. Sess.), § 267.)

• Subchapter 008: MANAGEMENT OF STATE DEBT

• § 1000. Affordable amount of general obligation bond authorization

  When the General Assembly authorizes the issuance of new long-term general obligation bonds, it shall consider the maximum amount of such bonds recommended as prudent for the fiscal year concerned by the Capital Debt Affordability Advisory Committee created for this purpose by this subchapter. This requirement shall apply to the authorizations of all State tax supported general obligation bonds, which are secured by the State General and Transportation Funds. (Added 1989, No. 258 (Adj. Sess.), § 1.)

• § 1001. Capital Debt Affordability Advisory Committee

  (a) Committee established. A Capital Debt Affordability Advisory Committee is hereby created with the duties and composition provided by this section.

  (b) Committee duties.

  (1) The Committee shall review annually the size and affordability of the net State tax-supported indebtedness and submit to the Governor and to the General Assembly an estimate of the maximum amount of new long-term net State tax-supported debt that prudently may be authorized for the next fiscal year. The estimate of the Committee shall be advisory and in no way bind the Governor or the General Assembly.

  (2) The Committee shall conduct ongoing reviews of the amount and condition of bonds, notes, and other obligations of instrumentalities of the State for which the State has a contingent or limited liability or for which the General Assembly is permitted to replenish reserve funds, and, when deemed appropriate, recommend limits on the occurrence of such additional obligations to the Governor and to the General Assembly.

  (3) The Committee shall conduct ongoing reviews of the amount and condition of the Transportation Infrastructure Bond Fund established in 19 V.S.A. § 11f and of bonds and notes issued against the Fund for which the State has a contingent or limited liability.

  (c) Committee estimate of a prudent amount of net State tax-supported debt; affordability considerations. On or before September 30 of each year, the Committee shall submit to the Governor and the General Assembly the Committee’s estimate of net State tax-supported debt that prudently may be authorized for the next fiscal year, together with a report explaining the basis for the estimate. The Committee’s estimate shall not take into consideration the balance remaining at the end of each fiscal year in the subaccounts of the Cash Fund for Capital and Essential Investments, established pursuant to section 1001b of this title. The provisions of 2 V.S.A. § 20(d) (expiration of required reports) shall not apply to the report to be made under this subsection. In developing its annual estimate, and in preparing its annual report, the Committee shall consider:

  (1) The amount of net State tax-supported indebtedness that during the next fiscal year and annually for the following nine fiscal years:

  (A) will be outstanding; and

  (B) has been authorized but not yet issued.

  (2) A projected schedule of affordable net State tax-supported bond authorizations for the next fiscal year and annually for the following nine fiscal years. The assessment of the affordability of the projected authorizations shall be based on all of the remaining considerations specified in this section.

  (3) Projected debt service requirements during the next fiscal year, and annually for the following nine fiscal years, based upon:

  (A) existing outstanding debt;

  (B) previously authorized but unissued debt; and

  (C) projected bond authorizations.

  (4) The criteria that recognized bond rating agencies use to judge the quality of issues of State bonds, including:

  (A) existing and projected total debt service on net tax-supported debt as a percentage of combined General and Transportation Fund revenues, excluding surpluses in these revenues that may occur in an individual fiscal year; and

  (B) existing and projected total net tax-supported debt outstanding as a percentage of total State personal income.

  (5) The principal amounts currently outstanding, and balances for the next fiscal year, and annually for the following nine fiscal years, of existing:

  (A) obligations of instrumentalities of the State for which the State has a contingent or limited liability;

  (B) any other long-term debt of instrumentalities of the State not secured by the full faith and credit of the State, or for which the General Assembly is permitted to replenish reserve funds; and

  (C) to the maximum extent obtainable, all long-term debt of municipal governments in Vermont that is secured by general tax or user fee revenues.

  (6) The impact of capital spending upon the economic conditions and outlook for the State.

  (7) The cost-benefit of various levels of debt financing, types of debt, and maturity schedules.

  (8) Any projections of capital needs authorized or prepared by the Agency of Transportation, the Joint Fiscal Office, or other agencies or departments.

  (9) Any other factor that is relevant to:

  (A) the ability of the State to meet its projected debt service requirements for the next five fiscal years; or

  (B) the interest rate to be borne by, the credit rating on, or other factors affecting the marketability of State bonds.

  (10) The effect of authorizations of new State debt on each of the considerations of this section.

  (d) Committee composition.

  (1) Committee membership shall consist of:

  (A) As ex officio members:

  (i) the State Treasurer;

  (ii) the Secretary of Administration; and

  (iii) a representative of the Vermont Municipal Bond Bank chosen by the directors of the Bank.

  (B) Two individuals with experience in accounting or finance, who are not officials or employees of State government appointed by the Governor for six-year terms.

  (C) The Auditor of Accounts who shall be a nonvoting ex officio member.

  (D) One person who is not an official or employee of State government with experience in accounting or finance appointed by the State Treasurer for a six-year term.

  (E) The Legislative Economist or other designee of the Joint Fiscal Office, who shall be a nonvoting ex officio member.

  (2) The State Treasurer shall be the Chair of the Committee.

  (e) Other attendants of committee meetings. Staff of the Legislative Counsel and the Joint Fiscal Committee shall be invited to attend Committee meetings for the purpose of fostering a mutual understanding between the Executive and Legislative Branches on the appropriate statistics to be used in committee reviews, debt affordability considerations, and recommendations.

  (f) Information. All public entities whose liabilities are to be considered by the Committee shall annually provide the State Treasurer with the information the Committee deems necessary for it to carry out the requirements of this subchapter. (Added 1989, No. 258 (Adj. Sess.), § 1; amended 2007, No. 121 (Adj. Sess.), § 28; 2007, No. 200 (Adj. Sess.), § 25, eff. June 9, 2008; 2009, No. 50, § 31; 2013, No. 142 (Adj. Sess.), § 65; 2019, No. 42, § 26a, eff. May 30, 2019; 2021, No. 105 (Adj. Sess.), § 478, eff. July 1, 2022; 2023, No. 78, § C.107, eff. June 20, 2023.)

• § 1001a. Reports

  (a) The Capital Debt Affordability Advisory Committee shall prepare and submit consistent with 2 V.S.A. § 20(a) a report on:

  (1) general obligation debt, pursuant to subsection 1001(c) of this title; and

  (2) how many, if any, Transportation Infrastructure Bonds have been issued and under what conditions.

  (b) The provisions of 2 V.S.A. § 20(d) (expiration of required reports) shall not apply to the reports to be made under this section. (Added 2003, No. 122 (Adj. Sess.), § 294h; amended 2009, No. 50, § 32, eff. June 1, 2009; 2013, No. 142 (Adj. Sess.), § 66; 2017, No. 84, § 28, eff. June 16, 2017.)

• § 1001b. Cash fund for Capital and Essential Investments

  (a) Creation. There is hereby created the Cash Fund for Capital and Essential Investments to be administered by the Commissioner of Finance and Management, in consultation with the State Treasurer. The Fund shall have the following two subaccounts:

  (1) the Capital Infrastructure subaccount, to defray the costs of future capital expenditures that would otherwise be authorized in the capital construction act and paid for using the State’s general obligation bonding authority and debt service obligations or paid for as a direct associated cost of a capital project; and

  (2) the Other Infrastructure, Essential Investments, and Reserves subaccount, to fund essential investments and infrastructure needs, create reserves for these expenditures and make contingent appropriations for other infrastructure investments, as authorized by the General Assembly.

  (b) Fund Accounts.

  (1) Capital Infrastructure subaccount. The Capital Infrastructure subaccount may consist of:

  (A) transfers made by the General Assembly of four percent or less of the last completed fiscal year’s General Fund appropriations, less the amount necessary to fund the State’s general obligation debt service in the year for which the transfer is being made, as determined by the State Treasurer and the Commissioner of Finance and Management; and

  (B) any interest earned by the subaccount.

  (2) Other Infrastructure, Essential Investments, and Reserves subaccount. The Other Infrastructure, Essential Investments, and Reserves subaccount may consist of any appropriations or transfers made by the General Assembly; from the General Fund or any other State fund and any contingent transfers made by the General Assembly from the General Fund after satisfying the requirements of 32 V.S.A. § 308 but prior to satisfying the requirements of 32 V.S.A. § 308c in any fiscal year and any contingent transfers made by the General Assembly from other State funds.

  (c) Use of funds. Monies in the Fund Accounts shall only be used as follows:

  (1) Expenditures shall only be made by the General Assembly from the Capital Infrastructure subaccount for:

  (A) tangible capital investments, as described in section 309 of this title, with an anticipated lifespan of 20 years or more; and

  (B) engineering and architectural costs directly associated with a proposed capital project.

  (2) Expenditures shall only be made by the General Assembly from the Other Infrastructure, Essential Investments, and Reserves subaccount for:

  (A) any expenditure eligible under subdivision (1) of this subsection (c); and

  (B) any other essential investments and infrastructure needs, including transportation-related projects and capitalization of revolving loan funds.

  (d) Fund balance. All balances in the Fund accounts at the end of any fiscal year shall be carried forward and remain part of the Fund accounts. Notwithstanding 32 V.S.A. § 511, the Commissioner of Finance and Management shall not anticipate receipts for the Fund accounts and issue warrants thereon.

  (e) Spending authority. Any entity authorized to make expenditures from the Capital Infrastructure subaccount shall have not more than two years from the legislative session in which the act authorizing the expenditure was enacted to encumber the funds. Any remaining unencumbered funds shall remain part of the Fund account. (Added 2021, No. 185 (Adj. Sess.), § E.106.1, eff. June 9, 2022; amended 2023, No. 78, § C.105, eff. June 20, 2023.)