The State Bond Commission may sell tobacco assets only with required approvals, and the state treasurer must report the final sale terms and direct proceeds into the Louisiana Fund or Millennium Trust as stated.
§99.12. Sale of tobacco assets A.(1) Subject to the conditions and declarations set forth in Subsection B hereof, the State Bond Commission subject to approval of the Joint Legislative Committee on the Budget and subject to approval by a majority vote of the legislature if the legislature is in session and by mail ballot during the interim, is authorized to sell and convey, from time to time, a portion of the state allocation to the corporation, up to sixty percent thereof from and after such date, and, in particular, to execute and deliver an agreement on the closing date. The agreement shall provide, among other matters, that the purchase price payable by the corporation to the state for the tobacco assets sold, up to sixty percent of the state allocation from and after such date, shall consist of the net proceeds, after financing costs, of the first issue of tobacco bonds and the residual interests to be paid and transferred semiannually pursuant to the provisions of this Subpart. (2)(a) After June 30, 2003, subject to the conditions and declarations set forth in Paragraphs (B)(1) and (2) hereof, the State Bond Commission shall declare its intent by granting preliminary approval and authorization to sell or convey up to one hundred percent of the state allocation to the corporation, in one or more series. Said declaration shall first be approved by the Joint Legislative Committee on the Budget and, if approved by the legislative committee, shall then be approved by a majority of the legislature if the legislature is in session. However, if the legislature is not in session, approval shall be granted by mail ballot. Upon approval of the legislature, the State Bond Commission shall commence with the sale as determined by the rules of the State Bond Commission. Net proceeds, after financing costs, of one or more issues of tobacco bonds and the residual interest to be paid shall be transferred pursuant to the provisions of this Subpart. Immediately upon closing of the sale or sales, the state treasurer shall report to the legislature the final terms and conditions of said sale or sales. (b) In the event a sale or sales authorized in this Paragraph is made during any fiscal year commencing on or after July 1, 2003, the state treasurer, in consultation with the commissioner of administration, shall provide for the deposit into the Louisiana Fund an amount of the net proceeds of any sale or sales that, together with other deposits, will ensure that a sufficient amount is deposited into the Louisiana Fund to fund the appropriations from that fund for that fiscal year. The remainder of such proceeds after deposit into the Louisiana Fund and any residuals received in such state fiscal year shall be deposited into the Millennium Trust. B.(1) The net proceeds of any sale authorized in Subsection A hereof and the residual interests shall constitute monies received as a result of the master settlement agreement, as set forth in Article VII, Sections 10.8 and 10.9, respectively, of the Louisiana Constitution, subject to the deposit and credit requirements thereof. (2) Except as provided in Paragraph (3) of this Subsection, pursuant to and in accordance with Article VII, Section 10.8(A)(5), of the Louisiana Constitution, the amount of the net proceeds of any sale authorized in Subsection A hereof, and of the residual interests, to be deposited in and credited to the Millennium Trust is increased to one hundred percent and the amount thereof to be deposited in and credited to the Louisiana Fund is decreased to zero. (3) In the event a sale or sales authorized in Subsection A of this Section is made during the state fiscal year commencing on July 1, 2001, the state treasurer, in consultation with the commissioner of administration, shall provide for the deposit into the Louisiana Fund an amount of the net proceeds of any such sale or sales that together with other deposits will ensure that fifty million dollars is deposited into the Louisiana Fund in that state fiscal year. The remainder of such proceeds after deposit into the Louisiana Fund, any residuals received in such state fiscal year and the net proceeds of any sale or sales occurring after that state fiscal year shall be deposited in the Millennium Trust. C. Any sale of tobacco assets hereunder shall be treated as a true sale and absolute conveyance and transfer of the property, and all of the right, title and interest in and to such property, so conveyed and transferred, and not as a pledge or any other security interest or lien for borrowing. The characterization of such a sale as an absolute transfer by the parties and herein shall not be negated or adversely affected if less than all of the state allocation is conveyed and transferred, nor by the state's acquisition of residual interests or a subordinate interest in the tobacco assets, nor by any characterization of the corporation or its bonds for purposes of accounting, taxation or securities regulation, nor by any other factor whatsoever. Acts 2001, No. 1145, §1; Acts 2003, No. 1136, §2, eff. July 2, 2003; Acts 2003, No. 1210, §1, eff. July 1, 2003.