§1405. General debt policy and procedures

A. The legislature shall enact laws establishing the general policy concerning the incurring of indebtedness by or on behalf of the state and its boards, departments, commissions, authorities, and agencies and establishing procedures for the issuance and sale of bonds issued by or on behalf of the state of Louisiana and its boards, departments, commissions, authorities and agencies. Such laws shall provide the general policy and procedures of the state to be followed by the state and the State Bond Commission in the issuance and the sale of bonds. All acts authorizing the issuance and sale of bonds by or on behalf of the state or any of its boards, departments, commissions, authorities and agencies shall conform to said general policy as enacted by the legislature and as may be amended by it from time to time, and such bonds shall be issued and sold in accordance with the laws establishing such policy and procedures.

B. No person or entity, public or private, shall incur debt or issue evidences of indebtedness for the purpose of financing any project in the state of Louisiana, the interest upon which indebtedness or evidence thereof is exempt from federal income taxation under Section 103 of the Internal Revenue Code of 1954, without the consent and approval of the State Bond Commission. Any evidence of indebtedness incurred or issued in violation of this Section shall be null and void and no court of this state shall have jurisdiction to enforce the payment thereof pursuant to the provisions of R.S. 47:1806.

C. The State Bond Commission is authorized to publish a report each year detailing its activities for the prior fiscal year and to present such report to the governor and the legislature prior to the beginning of each regular session of the legislature.

D.(1) Every negotiated sale of bonds, notes, or certificates of the state and its boards, departments, commissions, authorities, and agencies shall include a priority order period during which orders will be accepted solely for Louisiana retail purchase orders. "Louisiana retail purchase" shall mean a direct purchase by an individual resident of Louisiana or a company domiciled in Louisiana or a trust department, investment advisor, or money manager acting on behalf of a resident of Louisiana or a company domiciled in Louisiana and shall not include a purchase by an institutional customer. The director of the State Bond Commission may request copies of all initial trade confirmations to verify retail orders.

(2) The provisions of this Subsection shall not apply if the state treasurer or the director of the State Bond Commission determines that such action would be a financial detriment to the issuer.

Acts 1968, Ex.Sess., No. 26, §5. Amended by Acts 1982, No. 512, §1, eff. July 22, 1982; Acts 1991, No. 246, §1; Acts 2005, No. 444, §1.