Table of Contents
(Amending Executive Orders No. 261 and 248)
WHEREAS, the Ninety-Eighth Congress of the United States enacted, and on July 18, 1984 the President signed into law, the Tax Reform Act of 1984 (the "Act") which established a calendar year state ceiling on the volume of private activity bonds the interest on which is exempt from federal income taxes
WHEREAS, the Massachusetts state ceiling for 1986 is $873,300,000, which is $150 per capita multiplied by 5,822,000, the population of the Commonwealth based on the most recent estimate of its resident population released by the Bureau of Census before the beginning of the calendar year;
WHEREAS, the Act specifies an assignment of state ceiling between state agencies and other issuing authorities but provides that, subject to certain limitations, the Governor of any state may proclaim a different interim formula for assigning the state ceiling among the governmental units or other authorities in the state; and
WHEREAS, by Executive Order No. 248, as amended by Executive Order No. 261, the state ceiling was assigned to The Commonwealth of Massachusetts and procedures were established for the assignment of state ceiling among governmental units in the state;
WHEREAS, it is the intent of this order to confirm the assignment to The Commonwealth of Massachusetts, but to restate the procedures set forth in Executive Order No. 248, as amended by Executive Order No. 261, for the assignment of state ceiling;
NOW, THEREFORE, I, Michael S. Dukakis, Governor of the Commonwealth, by virtue of the authority vested in me as Supreme Executive Magistrate, do hereby restate and amend Executive Order No. 248, as amended by Executive Order No. 261, as follows:
- Terms used herein shall have the meanings set forth in the Internal Revenue Code of 1954, as amended.
- "Annual state ceiling" means the state ceiling for private activity bonds subject to allocation in 1986, or the state ceiling subject to allocation in any successive calendar year.
- "IDB cap" means the $350,000,000 of Massachusetts' 1986 state ceiling, and for each successive year means the dollar amount of the annual state ceiling designated as IDS cap by the Executive Office of Administration and Finance for The Commonwealth of Massachusetts ("A&F").
- Any reference to a date herein used without reference to a year shall mean that date in 1986 and in each successive calendar year.
2. Assignment to the Massachusetts Industrial Finance Agency. Eighty percent of the IDB cap will be assigned to the Massachusetts Industrial Finance Agency ("MIFA"), which shall allocate IDB cap from time to time to private activity bonds which are industrial development bonds issued or to be issued by itself, any municipality acting through a local Industrial Development Financing Authority or any other issuer within the state.
Inasmuch as the amount of the state ceiling assigned to MIFA is likely to be less than the demand for allocation of the ceiling, MIFA shall make allocations taking into account the considerations set forth in section 12 of chapter 40D of the Massachusetts General Laws and priorities set forth in any guidelines which MIFA shall adopt pursuant to section 9 of this order. Forty percent of the IDB cap is assigned to MIFA as of January 1, an additional twenty percent is assigned to MIFA as of April 1, and the remaining twenty percent is assigned to MIFA as of July l; provided, however, that A&F may in its discretion accelerate the schedule for assignment of the IDB cap.
3. Oversight by the Executive Office for Administration and Finance. Allocations of annual state ceiling to a particular bond issue by MIFA shall be effective in accordance with guidelines adopted by MIFA pursuant to section 9 of this order. Within ten business days following any such allocation or within such other reasonable period as A&F shall approve, MIFA shall provide A&F with the name and address of the issuer, the name and address of the borrower (except where the borrower has not been finally determined), the amount and duration of the allocation, the purposes of the issue, the justification for providing tax exempt financing to the project, including the extent to which the viability of the project depends upon such financing, the location of the project to be financed, if known, and such other information, if any, as A&F may require from time to time. Failure to submit such information to A&F shall not affect the effectiveness of an allocation, but may provide the basis for revocation or suspension of MIFA's authority to continue to allocate, as set forth below.
Any portion of the annual state ceiling assigned to MIFA pursuant to section 2 of this order which is not allocated before October 1, and any portion of the annual state ceiling assigned to MIFA pursuant to section 2 which, although allocated, is not used for bonds issued before November 1, shall, unless otherwise authorized by A&F, automatically be deemed reassigned to A&F for further allocation pursuant to section 4 of this order, or for carryforward pursuant to section 6 of this order.
In addition, A&F is hereby authorized to review from time to time the allocations made by MIFA to ensure that MIFA is following its guidelines adopted under section 9 of this order. If A&F determines that MIFA is not following its guidelines or has failed to submit required information concerning an allocation, A&F is authorized to revoke or suspend immediately MIFA's authority to continue to allocate, and to reassign to A&F any portion of the annual state ceiling not allocated. Any allocations made prior to such revocation or suspension shall remain effective. A&F may at its discretion reinstate at any time MIFA's authority to allocate state ceiling.
IDB cap reassigned to A&F may be used for any purpose permitted in section 4.
4. Assignment to the Executive Office for Administration and Finance. The remainder of Massachusetts' annual state ceiling after subtracting the IDB cap is assigned in each year to A&F, which shall in its discretion allocate this amount from time to time to issuers within the state. Such allocations shall be used for the purpose of issuing private activity bonds which are (a) industrial development bonds or (b) student loan bonds. In addition, the twenty percent of IDB cap remaining after the assignment to MIFA in section 2 is assigned to A&F, which shall in its discretion reassign or allocate such state ceiling at such time as it shall determine consistent with and pursuant to federal tax law. A&F shall allocate annual state ceiling only to those bonds which have received preliminary official action, if required by federal tax law, or as to which A&F has received a notice of intent to issue, from the proposed issuer. A&F may also reassign the annual state ceiling assigned to it pursuant to this section or reassigned to it pursuant to section 3 to MIFA for further allocation or for carryforward, in accordance with the provisions of this order. At the time it reassigns any state ceiling to MIFA, A&F shall specify when and if such reassignment shall expire.
5. Allocation Procedures. Each allocation of the annual state ceiling made by MIFA or A&F shall be in writing, shall be made for a specific bond issue and shall specify the date on or before which the bonds must be issued in order for the allocation to be effective. No allocation, except for carryforwards described in section 6, shall have an expiration date later than December 31. Allocations by MIFA from the amounts assigned to it in section 2 of this order shall be made no later than September 30, and shall expire no later than October 31, unless otherwise authorized by A&F.
6. Carryforwards. A&F may carry forward any unused portion of the remaining annual state ceiling assigned or reassigned to it pursuant to sections 3 or 4 of this order for any private activity bonds eligible for a carryforward of state ceiling under federal tax law. If A&F reassigns any of such amounts to MIFA, MIFA may allocate any unused portion of state ceiling to projects eligible for a carryforward, subject to such conditions as A&F may determine. No annual state ceiling may be allocated to carryforward projects prior to November 1.
7. Delegations. The following individuals are authorized to make all representations, file all documents and take all other actions in the name and on behalf of the entities listed below as may be required for compliance with federal tax law and to implement this order: (a) with respect to MIFA, the executive director or, with the express designation from time to time for the purpose by MIFA, any member of the board of directors or any officer, and (b) with respect to A&F, the Secretary of Administration or his or her designee. All designations made pursuant to this section shall be evidenced by a writing.
8. Recordkeeping. MIFA shall make such reports to A&F from time to time as A&F may require. In addition, each of MIFA and A&F shall make reasonably available to the public information as to the amount of its state ceiling not yet allocated and the expiration dates for all state ceiling allocated by it, and shall confirm upon request an allocation of state ceiling to a particular bond issue and the duration thereof.
9. Guidelines. Prior to making any allocations, each of MIFA and A&F shall adopt guidelines governing allocation of state ceiling assigned to it, provided that any such guidelines adopted by MIFA shall be approved by A&F before they become effective.
10. Transition Rules. Any bonds issued pursuant to an allocation by MIFA granted on or prior to February 20, 1986 shall be considered to have received an allocation of state ceiling pursuant to this order, which shall be counted against the state ceiling assigned to MIFA in section 2.
11. H.R. 3838. An allocation of state ceiling made pursuant to this order does not constitute an allocation pursuant to H.R. 3838 as passed by the United States of Representatives on December 17, 1985.
12. Effective Date. This order shall be deemed to be effective as of the date hereof and shall remain effective until the earlier of its termination as a matter of federal tax law or the effective date of any legislation enacted by the General Court with respect to the allocation of state ceiling under the Act.
Given at the Executive Chamber in Boston this 17th day of April in the year of our Lord, one thousand nine hundred and eighty-six, and of the Independence of the United States of America two hundred and eleven.
Michael S. Dukakis, Governor
Commonwealth of Massachusetts
Michael Joseph Connolly
Secretary of the Commonwealth