2005-2006 Bill 1427: Dissolution of special purpose districts

South Carolina General Assembly
116th Session, 2005-2006

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A343, R449, S1427

STATUS INFORMATION

General Bill
Sponsors: Senator Matthews
Document Path: l:\s-jud\bills\matthews\jud0089.jwm.doc

Introduced in the Senate on May 17, 2006
Introduced in the House on May 23, 2006
Last Amended on May 30, 2006
Passed by the General Assembly on May 31, 2006
Governor's Action: June 10, 2006, Signed

Summary: Dissolution of special purpose districts

HISTORY OF LEGISLATIVE ACTIONS

     Date      Body   Action Description with journal page number
-------------------------------------------------------------------------------
   5/17/2006  Senate  Introduced, read first time, placed on calendar without 
                        reference SJ-2
   5/17/2006  Senate  Unanimous consent for second and third readings on next 
                        two consecutive legislative days SJ-2
   5/18/2006  Senate  Read second time SJ-53
   5/18/2006          Scrivener's error corrected
   5/19/2006  Senate  Read third time and sent to House SJ-2
   5/23/2006  House   Introduced and read first time HJ-14
   5/23/2006  House   Referred to Committee on Ways and Means HJ-14
   5/25/2006  House   Recalled from Committee on Ways and Means HJ-35
   5/30/2006  House   Amended HJ-166
   5/30/2006  House   Read second time HJ-167
   5/31/2006  House   Read third time and returned to Senate with amendments 
                        HJ-29
   5/31/2006          Scrivener's error corrected
   5/31/2006  Senate  Concurred in House amendment and enrolled SJ-305
    6/7/2006          Ratified R 449
   6/10/2006          Signed By Governor
   6/14/2006          Copies available
   6/14/2006          Effective date 06/10/06
   6/16/2006          Act No. 343

View the latest legislative information at the LPITS web site

VERSIONS OF THIS BILL

5/17/2006
5/17/2006-A
5/18/2006
5/25/2006
5/30/2006
5/31/2006

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A343, R449, S1427)

AN ACT TO AMEND SECTION 4-11-290, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE DISSOLUTION OF SPECIAL PURPOSE DISTRICTS BY THE SECRETARY OF STATE, SO AS TO REVISE THE CONDITIONS AND REQUIREMENTS UNDER WHICH A DISTRICT MAY BE DISSOLVED, AND TO ALLOW A DISTRICT TO BE DISSOLVED IF THE DISTRICT HAS OUTSTANDING INDEBTEDNESS PAYABLE FROM REVENUES DERIVED FROM THE PROVISION OF ONE OR MORE GOVERNMENTAL SERVICES AND TO PROVIDE FOR THE METHOD BY WHICH A DISTRICT WITH OUTSTANDING INDEBTEDNESS MAY BE DISSOLVED.

Be it enacted by the General Assembly of the State of South Carolina:

Method and conditions of dissolution revised

SECTION 1. Section 4-11-290 of the 1976 Code, as last amended by Act 516 of 1992, is further amended to read:

"Section 4-11-290. (A) For purposes of this section, 'special purpose district' or 'district' means any district created by or pursuant to an act of the General Assembly before March 7, 1973, and to which has been committed before March 7, 1973, any governmental function, and includes those districts created by special legislation as well as those districts created by virtue of referenda held pursuant to general legislation.

(B) No special purpose district may be dissolved pursuant to this section if any one or more of the following conditions exists:

(1) the district is presently providing a governmental service within its boundaries;

(2) the district has outstanding general obligation indebtedness;

(3) the district has outstanding indebtedness payable from revenues derived from the provision of one or more governmental services and neither (i) the indebtedness has been assumed, with the consent of the holder of the indebtedness, by a political subdivision of the State of South Carolina that is authorized by law to provide the governmental services and that has agreed to take title to all necessary assets of the system from which revenues are derived, nor (ii) provision for payment or defeasance of the indebtedness has been made;

(4) a receiver has been appointed to manage the affairs of the district or application has been made for the appointment of a receiver;

(5) the district has provided a governmental service within two years of the date of the petition and has formally budgeted funds to resume the provision of a governmental service within the present or succeeding fiscal year; or

(6) the governing body of a county in which the district is located objects to the dissolution of the district.

(C) An individual residing or owning property within the boundaries of a special purpose district may petition the Secretary of State to dissolve the district through the issuance of an order of dissolution.

(D) A petition for dissolution of a special purpose district must contain the following items:

(1) a description of the governmental services which the district is authorized by law to provide;

(2) a statement that the district is not presently providing any authorized governmental service;

(3) identification of the special legislation or the general legislation pursuant to which the district was created. If the district was created pursuant to general legislation, the petition must state the date upon which the approving referendum was held;

(4) a general description of the boundaries of the district. If the boundaries of the district have at any time been enlarged or diminished pursuant to general laws, the date or dates of the action must be stated;

(5) a statement of the reason or reasons for which dissolution of the district is sought;

(6) if indebtedness is to be assumed and assets transferred to another political subdivision of the State of South Carolina as provided for in subsection (B)(3), evidence of official action by the governing body of the political subdivision authorizing the assumption of indebtedness and acceptance of assets;

(7) if provision for the payment or defeasance of indebtedness is to be made as provided for in subsection (B)(3), evidence of the provision for the payment or defeasance of indebtedness.

(E) The petition must be filed with the clerk of court of each county in which the district is located, and a certified copy of the petition shall within ten days after that time be filed with the Secretary of State.

(F) The Secretary of State shall, upon receipt of a petition, commence proceedings as set forth in this subsection for the purpose of investigating the matters set forth in the petition and determining whether a district must be dissolved.

(1) Within twenty days of the receipt of a petition, the Secretary of State shall serve upon the Governor, the State Treasurer, and the governing bodies of the county or counties in which the district is located a copy of the petition, together with a copy of the notice of review authorized by subsection (F)(2). The Governor, the State Treasurer, and the county governing bodies may comment upon the petition, or in the case of county governing bodies, interpose an objection to dissolution of the district, by serving a return to the petition setting forth the comments or grounds for the objection within forty days of the service of the petition.

(2) Within twenty days of the receipt of a petition, the Secretary of State must have published in a newspaper of general circulation in each county in which the district is located once a week for three successive weeks a notice of review which must state:

(a) the name of the district and the boundaries of it;

(b) the statutory authorization for the existence of the district and a brief description of the governmental powers granted by the authorization;

(d) that the petition is available for inspection at the office of the clerks of court in each county in which the district is located;

(e) that the Secretary of State is reviewing the matters set forth in the petition and may undertake to dissolve the district if the matters are found to be true;

(f) the names of the persons shown in the records of the Secretary of State, or, in the case of a district with an elected governing body, the county election commission, who constitute the most recently appointed or elected governing body of the district. In the case of an appointed governing body, there also must be identified the official or officials charged with appointing the members of the governing body; and

(g) that persons wishing to comment upon the dissolution of the district may file a return to the petition within twenty days of the last publication of the notice.

(3) A copy of the petition and the notice of review must be served, in the manner provided by law for service of process upon individuals, upon the persons identified as members of the governing body of the district in subsection (F)(2)(f) and mailed to the last known address, if any, of the office of the governing body.

(G) Upon the expiration of the time periods set forth in subsections (F)(1) and (2), the filing of a return to the petition, the Secretary of State shall determine whether the district must be dissolved. The district must be dissolved if the procedures established by this section have been met and if none of the conditions set forth in subsection (B) are found by the Secretary of State to exist. The findings of the Secretary of State must be published in an order of dissolution. The order of dissolution must state:

(1) the name of the district and the boundaries of it;

(2) the statutory authorization for the existence of the district and a brief description of the governmental powers granted by such authorization;

(3) the date upon which the petition was received by the Secretary of State;

(4) that the petition has been served upon the Governor, the State Treasurer, and the governing bodies of each county in which the district is located;

(5) that the notice of review provided for by subsection (F)(2) was published once a week for three successive weeks in a newspaper of general circulation in each county in which the district is located;

(6) that the persons shown in the records of the Secretary of State, or, in the case of a district with an elected governing body, the county election commission, who constitute the most recently appointed or elected governing body of the district, were served with a copy of the petition and the notice of review; and

(7) that the Secretary of State has caused investigation to be made and has determined that the district must be dissolved pursuant to this act.

(H)(1) The order of dissolution must be filed in the office of the clerk of court in each county in which the district is located. The Secretary of State shall have published once a week for three successive weeks in a newspaper of general circulation in each county in which the district is located a notice of dissolution, which must state:

(a) the date of the filing of the petition;

(b) the statutory authorization for the existence of the district and a brief description of the governmental powers granted by the authorization and the boundaries of the district;

(d) that the order of dissolution is available for inspection in the office of the clerk of court of each county in which the district is located; and

(e) that the order of dissolution will become final on the twenty-first day following the final publication of the notice of dissolution.

(2) The notice of dissolution also must be served upon the Governor and the State Treasurer in the manner provided by law for service of process upon individuals, upon the persons identified as members of the governing body of the district in subsection (F)(2)(f) and be mailed to the last known address, if any, of the office of such governing body.

(3) Any resident or landowner of the district, the Governor, the State Treasurer, or a county governing body may, by action de novo instituted in the court of common pleas in a county in which the district is located, within twenty days following the publication of the notice of dissolution, but not afterwards, challenge the action of the Secretary of State. The scope of any action must be limited to the authorization of the Secretary of State to issue the order of dissolution in accordance with the requirements of this chapter or of the Constitution of this State.

(I) In the event a district is located in more than one county and the Secretary of State declines to issue an order of dissolution solely on the grounds that the governing bodies of one or more of such counties object to dissolution, the governing body of any county which does not object to dissolution is authorized to diminish the boundaries of the district so that it no longer includes any portion of that county. In diminishing the boundaries of a district, the governing body shall utilize the procedure set forth in Article 3, Chapter 11, Title 6. No consent or action by the governing bodies of other counties in which the district is located is required.

(J) In the event the district being dissolved has title to real or personal assets, those assets shall be disposed of as provided in this subsection.

(1) To the extent that the district is authorized by the act creating or establishing the district to provide services and one or more of those services are as of the date of dissolution provided by another political subdivision of the State of South Carolina, the Secretary of State:

(a) must convey to such political subdivision:

( i) any and all assets of the district necessary, useful, or otherwise related to the provision of the service or services by the political subdivision; and

(ii) any assets then being used by the political subdivision to provide the service or services to the political subdivision; and

(b) must execute and deliver any deeds, bills of sale, or other evidence of conveyance of the property as may be required by law to make the asset conveyance effective.

(2) In the event that a political subdivision has assumed indebtedness of the district being dissolved as provided in subsection (B)(3), all assets securing such indebtedness must be conveyed to the political subdivision in accordance with this subsection. The Secretary of State is authorized to convey by his signature title to any and all assets as provided in this subsection, and his signature on any deed, bill of sale, or other instrument of conveyance shall be effective and binding for that purpose.

(3) All other assets of the district shall escheat to the State and shall be disposed of in accordance with Chapter 27 of Title 19."

Time effective

SECTION 2. This act takes effect upon approval by the Governor.

Ratified the 7th day of June, 2006.

Approved the 10th day of June, 2006.

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