Oklahoma Administrative Code Title 90 - Council of Bond Oversight
Detailed Explanation: Oklahoma Administrative Code Title 90 – Council of Bond Oversight
1. Overview of Title 90 – Council of Bond Oversight (CBO)
The Council of Bond Oversight (CBO) is an administrative body created by the Oklahoma Legislature to oversee the issuance of certain state debt obligations, primarily bonds, by state agencies and public entities.
The CBO ensures fiscal responsibility and transparency in the issuance and management of bonds that could impact the state's credit and financial standing.
It reviews, approves, or disapproves bond issuances, leases, and financing agreements to ensure compliance with state law and prudent financial management.
The Council operates under authority granted in the Oklahoma Bond Oversight Act, codified primarily in 62 Oklahoma Statutes §§ 695.1 through 695.14.
Title 90 of the Oklahoma Administrative Code codifies the administrative rules and procedures governing the Council of Bond Oversight’s operations, including meeting procedures, bond review standards, reporting requirements, and appeals.
2. Statutory Authority and Purpose
The Oklahoma Bond Oversight Act (62 O.S. §§ 695.1–695.14) created the CBO to provide independent review of debt issuance proposals by various state agencies and public entities, to prevent excessive or imprudent debt issuance that might threaten the state's financial health.
The Act requires state agencies and political subdivisions to submit bond issuance proposals to the CBO for review and approval before issuance.
The Council also monitors ongoing compliance with bond covenants and financial reporting.
3. Structure and Powers of the Council of Bond Oversight
The Council consists of seven members appointed by the Governor and confirmed by the Senate, including experts in finance, law, and public administration.
The CBO holds regular meetings, follows open meeting laws, and maintains minutes and public records.
The Council has authority to approve or reject bond proposals, request additional information, and require modifications to proposals to protect the state's interests.
It may impose conditions on bond issuance and financing agreements.
4. Key Provisions of OAC Title 90
a. Submission and Review of Bond Issuance Proposals
Agencies must submit detailed proposals, including financial statements, bond terms, repayment plans, and impact analyses.
The Council reviews proposals for compliance with state law, fiscal prudence, and impact on state credit.
Proposals must be submitted sufficiently in advance of issuance to allow proper review.
b. Criteria for Approval or Disapproval
The Council evaluates whether the proposed debt issuance:
Complies with statutory debt limits and constitutional requirements;
Is consistent with the state’s financial policies and budgetary constraints;
Has a reasonable repayment plan and sound financial structure.
c. Monitoring and Reporting Requirements
Approved issuers must submit ongoing financial reports, compliance certifications, and notify the Council of any material changes or defaults.
The Council monitors bond markets and advises the Legislature and Governor on debt management.
d. Administrative Procedures and Appeals
The Code establishes procedures for conducting meetings, providing notice, and documenting decisions.
Agencies or issuers denied approval may request reconsideration or appeal under procedures consistent with Oklahoma’s Administrative Procedures Act.
5. Relevant Oklahoma Case Law
Oklahoma case law regarding the Council of Bond Oversight is relatively sparse, but cases interpreting the Bond Oversight Act and related administrative agency authority provide important guidance:
A. State ex rel. Oklahoma Tax Commission v. City of Norman, 1999 OK CIV APP 7
The Court of Civil Appeals examined the limits on municipal debt issuance and the role of state oversight in controlling public debt.
The case reinforces the principle that entities must comply with statutory requirements and oversight mechanisms, such as review by the Council of Bond Oversight, before issuing bonds.
It supports the Council’s authority to ensure lawful and prudent debt issuance.
B. State ex rel. McGirt v. Oklahoma Development Finance Authority, 2007 OK CIV APP 90
This case dealt with the financing of development projects and the applicability of oversight provisions.
It underscored the need for transparency and adherence to statutory requirements in issuing state-backed obligations.
The case supports the role of the Council in preventing unauthorized or improper debt issuances.
C. State ex rel. Grand River Dam Authority v. State Board of Equalization, 1979 OK 117
While not directly about the Council of Bond Oversight, this case discusses the importance of adherence to statutory mandates in state agencies' financial decisions.
It highlights the courts’ role in upholding statutory limits and administrative oversight as tools of fiscal responsibility.
6. Summary Table of Key Provisions and Case Law
| Topic | Statutory/Code Provision | Relevant Case | Explanation |
|---|---|---|---|
| Bond Issuance Review and Approval | 62 O.S. §§ 695.1-695.14; OAC Title 90 | State ex rel. OTC v. City of Norman | CBO reviews bond proposals for compliance and fiscal prudence; approval required before issuance. |
| Monitoring and Reporting | OAC Title 90 | State ex rel. McGirt v. OK Development Finance Authority | Issuers must report financial compliance; Council monitors ongoing obligations. |
| Administrative Procedure and Appeals | OAC Title 90; Oklahoma APA | State ex rel. Grand River Dam Authority v. State Board of Equalization | Due process and statutory compliance required in Council’s decisions and enforcement. |
7. Practical Implications for Stakeholders
State Agencies and Public Entities: Must plan early for bond issuance, prepare comprehensive proposals, and comply with CBO review and reporting requirements to avoid delays or denials.
Council Members: Must apply statutory criteria, maintain transparency, and exercise discretion to protect the state's fiscal integrity.
Investors and Bondholders: Rely on CBO oversight to ensure that issued bonds meet legal standards and that issuers maintain financial health.
Taxpayers and Legislators: Benefit from oversight mechanisms that prevent excessive or imprudent public debt, ensuring state fiscal sustainability.
Conclusion
Oklahoma Administrative Code Title 90 codifies the procedures and rules governing the Council of Bond Oversight, an essential body for maintaining fiscal responsibility in state and public bond issuances. Supported by statutory authority and Oklahoma case law, the Council plays a critical role in reviewing, approving, monitoring, and enforcing state debt issuance practices to safeguard public interests.
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