SB217 Alabama 2025 Session

Summary

Primary Sponsor

Arthur OrrSenator

Republican

Session

2025 Regular Session

Title

Require bond financing agreement documents to include schedule of debt obligation of county

Summary

SB217 would require counties and municipalities to include detailed debt schedules and disclosures in bond documents, have them reviewed and signed by governing officials and officials from the underwriting team, and publish these forms publicly before issuing bonds.

What This Bill Does

If passed, the bill would require bond financing agreements to include a schedule of all debt obligations for the life of the debt and a debt payment schedule, with acknowledgments signed by the county chair and the bond underwriter confirming these items were presented to the county commission. It adds similar requirements to the county's and municipality's bond financing review forms, which must be submitted to the Department of Examiners of Public Accounts and kept publicly available for seven years. The bill also requires itemized costs and fees, added disclosures for swaps, and means for advisers and underwriters to provide thorough information and risk disclosures; it creates an effective date and an exemption for certain utility-related debt, and restricts municipalities from issuing debt before meeting these requirements.

Who It Affects

• Counties and municipalities in Alabama would have to implement new debt schedules, receipts of debt service information, and signed acknowledgments, influencing how they plan and approve bonded debt.
• Bond underwriters, bond counsel, issuer's counsel, trustees, advisers, and other professionals involved in bond issues would be required to provide detailed schedules, disclose costs and fees, supply debt service projections, disclose swap-related risks, and sign the required acknowledgments.

Key Provisions

• Bond financing agreements must include a schedule of all county debt obligations for the life of the debt and a debt payment schedule; the chair of the county commission and the bond underwriter's authorized signatory must sign an acknowledgment that these have been presented and explained to the county commission before bond sale.
• The county government bond financing review form must include a statement that the commission has received a potential debt service schedule and has been advised of the county's ability to pay all debt obligations; similar procedure applies to municipalities.
• Forms must be submitted to the Department of Examiners of Public Accounts and kept on file for public inspection for seven years.
• Bond financing documents must itemize costs and fees payable by the municipality or from bond proceeds, with an acknowledgment signed by the city chair and the underwriter's signatory.
• A schedule of all debt obligations and a debt payment plan for the debt’s maturity must be included, with an acknowledgment that these have been explained to all council members prior to sale.
• For swaps, documentation and risk disclosures must be provided, and the municipality must designate a responsible official to oversee swaps; advisers must review related documents and assess whether swap obligations are general obligation debt and their payment sources.
• The bill provides an exemption from these requirements for debt incurred to improve or expand utility systems if financed by dedicated revenues, and it states a requirement that municipalities cannot enter into bond financings after October 1, 2024 until sections 2-6 are satisfied.
• The act becomes effective October 1, 2024.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Counties & Municipalities