SECTION 1. LIMITATION ON PUBLIC INDEBTEDNESS. The legislature shall not in any manner create any debt or debts, liability or liabilities, except in case of war, to repel an invasion, or suppress an insurrection, unless the same shall be authorized by law, for some single object or work, to be distinctly specified therein, which law shall provide ways and means, exclusive of loans, for the payment of the interest on such debt or liability as it falls due, and also for the payment and discharge of the principal of such debt or liability within twenty years of the time of the contracting thereof, and shall be irrepealable until the principal and interest thereon shall be paid and discharged. But no such law shall take effect until at a general election it shall have been submitted to the people, and shall have received a majority of all the votes cast for or against it at such election, and all moneys raised by the authority of such laws shall be applied only to specified objects therein stated or to the payment of the debt thereby created, and such law shall be published prior to the general election at which it is submitted to the people, in the same manner as amendments to this constitution are published. The legislature may at any time after the approval of such law, by the people, if no debts shall have been contracted in pursuance thereof, repeal the same.
This section shall not apply to liabilities incurred for ordinary operating expenses, nor shall it apply to debts or liabilities that are repaid by the end of the fiscal year. The debts or liabilities of the independent public bodies corporate and politic created by law and which have no power to levy taxes or obligate the general fund of the state are not debts or liabilities of the state of Idaho. The provisions of this section shall not make illegal those types of financial transactions that were legal on or before November 3, 1998.
SECTION 2. LOAN OF STATE’S CREDIT PROHIBITED – HOLDING STOCK IN CORPORATION PROHIBITED – DEVELOPMENT OF WATER POWER. (1) The credit of the state shall not, in any manner, be given, or loaned to, or in aid of any individual, association, municipality or corporation; nor shall the state directly or indirectly, become a stockholder in any association or corporation, provided, that the state itself may control and promote the development of the unused water power within this state.
(2) Notwithstanding the provisions of subsection (1), there is hereby created the public school guarantee fund which shall consist of funds provided by law to guarantee the debt of school districts in accordance with law. The state may guarantee the debt of school districts and may guarantee debt incurred to refund the school district debt. Any debt guaranty, the school district debt guaranteed thereby, or any borrowing of the state undertaken to facilitate the payments of the state's obligation under any debt guaranty shall not be included as a debt of the state for the purposes of the limitation of Section 1 of Article VIII. The legislature may provide by law that reimbursement to the state shall be obtained from moneys which otherwise would be used for the support of the educational programs of the school district which incurred the debt with respect to which a payment under the state's guaranty pursuant to this section was made.
SECTION 2A. MUNICIPAL BOND BANK AUTHORITY. (1) Notwithstanding the provisions of subsection (1) of Section 2 of Article VIII, the legislature may enact laws authorizing the state to establish a bond bank authority to purchase the bonds, notes or other obligations of a municipality issued or undertaken for any purpose authorized by law and to lend money to a municipality with such loans to be secured by bonds, notes or other obligations of the municipality issued or undertaken as authorized by law. To enable the authority to obtain funds to purchase municipal bonds, notes or other obligations or to make loans to municipalities, the legislature may enact laws authorizing the bond bank authority to:
(a) Issue revenue bonds, notes or other obligations payable from or secured by bonds, notes or other obligations of one or more municipalities;
(b) Pledge or otherwise obligate, for and in the name and on behalf of the state as its agent and instrumentality, specific funds or revenues of the state, as a source of payment or security for bonds, notes or other obligations issued by the authority, with such priority over other uses of such funds or revenues as the authority shall determine, in accordance with law, to be necessary or appropriate;
(c) Establish debt service reserve funds or other reserve funds;
(d) Obtain private credit enhancement for bonds, notes or other obligations issued by the authority;
(e) Establish a revolving loan program to purchase municipal bonds, notes or other obligations or to lend money to municipalities;
(f) Invest moneys held by the authority, as proceeds or to pay or secure bonds, notes or other obligations issued by the authority, in such securities or obligations as are described in the indenture, trust agreement or other instrument providing for the issuance of the bonds, notes or other obligations;
(g) Invest any moneys held by the authority, in excess of funds described in paragraph (f) of this subsection, in any securities or other obligations in which a trustee may invest as provided by law;
(h) Take any other actions and enter into such other contract and agreements as it may determine to be necessary or appropriate to accomplish the purposes of a bond bank authority or this section.
(2) To provide for the sale of municipal bonds, notes or other obligations to the authority and for the issuance of municipal bonds, notes or other obligations for purchase by the authority or as security for loans from the authority, the legislature may enact laws authorizing a municipality, in addition to any other powers municipalities may have, and without regard to the restrictions or requirements that might otherwise apply under the laws of this state, but subject to the requirements of Section 3 of Article VIII, and any other limitations imposed upon municipalities by the Constitution of the State of Idaho, to:
(a) Issue bonds, notes or other obligations for sale to or as security for loans received from the authority, with such interest rate, maturity, redemption, security, remedies and other terms as the municipality may agree with the authority;
(b) Levy and collect property taxes, fees, rates, charges and other assessments to pay or secure the bonds, notes or other obligations issued by the municipality for sale to or as security for loans received from the authority;
(c) Pledge and assign to the authority or its designee property taxes, fees, rates, charges and other assessments, and rights to enforce the collection and application thereof, to pay or secure the bonds, notes or other obligations issued by the municipality for sale to or as security for loans received from the authority;
(d) Take any other actions and enter into such other contracts and agreements as it may determine with the authority to be necessary or appropriate to accomplish the purposes of a bond bank authority or this section.
(3) The provisions of Section 1 and subsection (1) of Section 2 of Article VIII shall not be construed as a limitation upon the authority granted by this section and any debt or liability of the state arising as a result of the exercise of powers authorized by this section shall not be deemed a debt of the state for purposes of Section 1 of Article VIII. The provisions of this section are supplemental to and shall not be construed as a repeal of or limitation upon any authority of a municipality under Section 3 or 4 of Article VIII, or any other authority lawfully exercisable by a municipality under the Constitution and laws of this state, including, among others, any authority to issue general obligation bonds, revenue bonds or tax anticipation notes or to enter into contracts for or undertake other financial obligations.
(4) For purposes of this section, “municipality” shall include any county, city, municipal corporation, school district, irrigation district, sewer district, water district, highway district or other special purpose district or political subdivision of the state established by law.
SECTION 3. LIMITATIONS ON COUNTY AND MUNICIPAL INDEBTEDNESS. No county, city, board of education, or school district, or other subdivision of the state, shall incur any indebtedness, or liability, in any manner, or for any purpose, exceeding in that year, the income and revenue provided for it for such year, without the assent of two[-]thirds (2/3) of the qualified electors thereof voting at an election to be held for that purpose, nor unless, before or at the time of incurring such indebtedness, provisions shall be made for the collection of an annual tax sufficient to pay the interest on such indebtedness as it falls due, and also to constitute a sinking fund for the payment of the principal thereof, within thirty (30) years from the time of contracting the same. Any indebtedness or liability incurred contrary to this provision shall be void: Provided, that this section shall not be construed to apply to the ordinary and necessary expenses authorized by the general laws of the state and provided further that any city may own, purchase, construct, extend, or equip, within and without the corporate limits of such city, off street parking facilities, public recreation facilities, and air navigation facilities, and for the purpose of paying the cost thereof may, without regard to any limitation herein imposed, with the assent of two[-]thirds (2/3) of the qualified electors voting at an election to be held for that purpose, issue revenue bonds therefor, the principal and interest of which to be paid solely from revenue derived from rates and charges for the use of, and the service rendered by, such facilities as may be prescribed by law, and provided further, that any city or other political subdivision of the state may own, purchase, construct, extend, or equip, within and without the corporate limits of such city or political subdivision, water system, sewage collection systems, water treatment plants, sewage treatment plants, and may rehabilitate existing electrical generating facilities, and for the purpose of paying the cost thereof, may, without regard to any limitation herein imposed, with the assent of a majority of the qualified electors voting at an election to be held for that purpose, issue revenue bonds therefor, the principal and interest of which to be paid solely from revenue derived from rates and charges for the use of, and the service rendered by such systems, plants and facilities, as may be prescribed by law; and provided further that any port district, for the purpose of carrying into effect all or any of the powers now or hereafter granted to port districts by the laws of this state, may contract indebtedness and issue revenue bonds evidencing such indebtedness, without the necessity of the voters of the port district authorizing the same, such revenue bonds to be payable solely from all or such part of the revenues of the port district derived from any source whatsoever excepting only those revenues derived from ad valorem taxes, as the port commission thereof may determine, and such revenue bonds not to be in any manner or to any extent a general obligation of the port district issuing the same, nor a charge upon the ad valorem tax revenue of such port district.
SECTION 3A. ENVIRONMENTAL POLLUTION CONTROL REVENUE BONDS – ELECTION ON ISSUANCE. Counties of the state may in the manner prescribed by law issue revenue bonds for the purpose of acquiring, constructing, installing and equipping facilities designed for environmental pollution control, including the acquisition of all technological facilities and equipment necessary or convenient for pollution control, to be financed for, or to be sold, leased or otherwise disposed of to, persons, associations, or corporations other than municipal corporations or other political subdivisions; provided, that such revenue bonds are issued with the assent of a majority of the qualified electors of the county voting at an election to be called and held for that purpose; and provided further, that such revenue bonds shall not be secured by the full faith and credit or the taxing power of the state or of any political subdivision thereof. No provision of this constitution, including, but not limited to sections 3 and 4 of article VIII and section 4 of article XII, shall be construed as a limitation upon the authority granted under this section. Nothing herein contained shall authorize any county of the state to operate any industrial or commercial enterprise.
SECTION 3B. PORT DISTRICT FACILITIES AND PROJECTS – REVENUE BOND FINANCING. Port districts may acquire, construct, install, and equip facilities or projects to be financed for, or to be leased, sold or otherwise disposed of to persons, associations or corporations other than municipal corporations and may in the manner prescribed by law issue revenue bonds to finance the costs thereof; provided that any such revenue bonds shall be payable solely from charges, rents or payments derived from the facilities or projects financed thereby and shall not be secured by the full faith and credit or the taxing power of the port district, the state, or any other political subdivision. No provision of this Constitution, including, but not limited to Sections 3 and 4 of Article VIII and Section 4 of Article XII, shall be construed as a limitation upon the authority granted under this section.
SECTION 3C. HOSPITALS AND HEALTH SERVICES AUTHORIZED – ACTIVITIES AND FINANCING. Provided that no ad valorem tax revenues shall be used for activities authorized by this section, public hospitals, ancillary to their operations and in furtherance of health care needs in their service areas, may: (i) incur indebtedness or liability to purchase, contract, lease or construct or otherwise acquire facilities, equipment, technology and real property for health care operations as provided by law; (ii) acquire, construct, install and equip facilities or projects to be financed for, or to be leased, sold or otherwise disposed of to persons, associations or corporations other than municipal corporations and may, in the manner prescribed by law, finance the costs thereof; (iii) engage in shared services and other joint or cooperative ventures; (iv) enter into joint ventures and partnerships; (v) form or be a shareholder of corporations or a member of limited liability companies; (vi) have members of its governing body or its officers or administrators serve as directors, managers, officers or employees of any venture, association, partnership, corporation or limited liability company as authorized by this section; (vii) own interests in partnerships, corporations and limited liability companies. Any obligations incurred pursuant to this section shall be payable solely from charges, rent or payments derived from the existing facilities and the facilities or projects financed thereby and shall not be secured by the full faith and credit or the taxing power of the county, hospital taxing district, the state, or any other political subdivision; and provided further, that any county or public hospital taxing district contracting such indebtedness shall own its just proportion to the whole amount so invested. The authority granted by this section shall be exercised for the delivery of health care and related service and with the prior approval of the governing body of the county, hospital district or other governing body of a public hospital. No provisions of this Constitution including, but not limited to Sections 3 and 4 of Article VIII, and Section 4 of Article XII, shall be construed as a limitation upon the authority granted under this section.
SECTION 3D. MUNICIPAL ELECTRIC SYSTEMS – AUTHORIZED INDEBTEDNESS. Notwithstanding the limitations and requirements of Section 3, Article VIII, of the Constitution of the State of Idaho, any city owning a municipal electric system may:
(a) acquire, construct, install and equip electric generating, transmission and distribution facilities for the purpose of supplying electricity to customers located within the service area of each system established by law and for the purpose of paying the cost thereof, may issue revenue bonds with the assent of a majority of the qualified electors voting at an election held as provided by law; and
(b) incur indebtedness or liability under agreements to purchase, share, exchange or transmit wholesale electricity for the use and benefit of customers located within such service area; provided that any revenue bonds, indebtedness or liability shall be payable solely from the rates, charges or revenues derived from the municipal electric system and shall not be secured by the full faith and credit or the taxing power of the city, the state or any political subdivision.
SECTION 3E. AIRPORTS AND AIR NAVIGATION FACILITIES – AIRPORT RELATED PROJECTS – REVENUE AND SPECIAL FACILITY BOND FINANCING. Political subdivisions of the state and regional airport authorities as defined by law, if operating an airport, may acquire, construct, install, and equip land, facilities, buildings, projects or other property, which are hereby deemed to be for a public purpose, to be financed for, or to be leased, sold or otherwise disposed of to persons, associations or corporations, or to be held by the subdivision or regional airport authority, and may in the manner prescribed by law issue revenue and special facility bonds to finance the costs thereof; provided that any such bonds shall be payable solely from fees, charges, rents, payments, grants, or any other revenues derived from the airport or any of its facilities, structures, systems, or projects, or from any land, facilities, buildings, projects or other property financed by such bonds, and shall not be secured by the full faith and credit or the taxing power of the subdivision or regional airport authority. No provision of this constitution including, but not limited to, sections 3 and 4 of article VIII and section 4 of article XII, shall be construed as a limitation upon the authority granted under this section.
SECTION 4. COUNTY, ETC., NOT TO LOAN OR GIVE ITS CREDIT. No county, city, town, township, board of education, or school district, or other subdivision, shall lend, or pledge the credit or faith thereof directly or indirectly, in any manner, to, or in aid of any individual, association or corporation, for any amount or for any purpose whatever, or become responsible for any debt, contract or liability of any individual, association or corporation in or out of this state.
SECTION 5. SPECIAL REVENUE FINANCING. The legislature may enact laws authorizing the creation of public corporations by counties or cities to issue nonrecourse revenue bonds or other nonrecourse revenue obligations and to apply the proceeds thereof in the manner and for the purposes heretofore or hereafter authorized by law, subject to the following limitations:
Nonrecourse revenue bonds and other nonrecourse revenue obligations issued pursuant to this section shall be payable only from money or other property received as a result of projects financed by the nonrecourse revenue bonds or other nonrecourse revenue obligations and from money and other property received from private sources.
Nonrecourse revenue bonds and other nonrecourse revenue obligations issued pursuant to this section shall not be payable from or secured by any tax funds or governmental revenue or by all or part of the faith and credit of the state or any political subdivisions.
Nonrecourse revenue bonds or other nonrecourse revenue obligations issued pursuant to this section may be issued only if the issuer certifies that it reasonably believes that the interest paid on the bonds or obligations will be exempt from income taxation by the federal government.
Nonrecourse revenue bonds or other nonrecourse revenue obligations may only be used to finance industrial development facilities consisting of manufacturing, processing, production, assembly, warehousing, solid waste disposal, recreation and energy facilities, excluding facilities to transmit, distribute or produce electrical energy.
The counties or cities shall never exercise their respective attributes of sovereignty including, but not limited to, the power to tax, the power of eminent domain, and the police power on behalf of any industrial development project authorized pursuant to this section.
Sections 2, 3 and 4 of Article VIII shall not be construed as a limitation upon the authority granted by this section. The proceeds of revenue bonds and other revenue obligations issued pursuant to this section for the purpose of financing privately owned property or loans to private persons or corporations shall be subject to audit by the state but shall not otherwise be deemed to be public money or public property for purposes of this constitution. This section is supplemental to and shall not be construed as a repeal of or limitation on any other authority lawfully exercisable under the constitution and laws of this state, including, among other [others], any existing authority to issue revenue bonds.