An Act To Preserve Transportation Projects Statewide by Using Federal GARVEE Financing for the Waldo-Hancock Bridge Replacement
Maine Legislature, Session 121, LD 1922
Committee: Transportation
Sponsors: DAMON, ROSEN, WESTON, YOUNGBLOOD, ASH, BERRY, KAELIN, MARLEY, RICHARDSON

Legislative Document 
No. 1922 
S.P.758 
In Senate, March 10,2004 
An Act To Preserve Transportation Projects Statewide by Using 
Federal GARVEE Financing for the Waldo-Hancock Bridge 
Replacement 
Reference to the Committee on Transportation suggested and ordered printed. 
Presented by Senator DAMON of Hancock. (GOVERNOR'S BILL) 
Cosponsored by Representative ROSEN of Bucksport and 
JOY J. O'BRIEN 
Secretary of the Senate 
Senators: SA V AGE of Knox, WESTON of Waldo, YOUNGBLOOD of Penobscot, 
Representatives: ASH of Belfast, BERRY of Belmont, KAELIN of Winterport, MARLEY of 
Portland, RICHARDSON of Brunswick. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. Definitions. 
otherwise 
indicates, 
meanings. 
As used in this Act, 
the 
following 
terms 
unless the context 
have 
the 
following 
1.. 
Bank. 
"Bank" means the Maine Municipal Bond Bank. 
2. 
GARVEE. 
"GARVEE" 
means 
grant 
anticipation 
revenue 
vehicle debt financing. 
3. 
Oua1.ified 
transportation 
project. 
"Qualified 
transportation project" means all projects associated with the 
replacement of the Waldo-Hancock 
Bridge 
and 
approved by 
the 
Federal Highway Administration. 
4. 
Revenues. 
"Revenues" means, in the case of bonds or 
notes issued by the bank to finance the qualified transportation 
project, 
payments 
of 
funds 
derived from 
the Federal 
Highway 
Administration 
and 
other 
investments, 
giftS, 
grants, 
contributions, 
appropriations, 
income 
and 
any 
other 
amounts 
pledged to secure payment of such bonds or notes. 
Sec. 2. Qualified transportation project costs. 
Costs 
of 
the 
qualified transportation project 
include, 
without 
limitation, 
costs related to: 
A. 
The purchase price or acquisition of any property or 
interests in those properties or other rights necessary or 
convenient for such projects; 
B. 
The 
study, 
permitting 
and 
engineering 
project, 
including 
the 
preparation 
of 
specifications, surveys and estimates of cost; 
of 
any 
plans 
such 
and 
C. 
Construction, 
reconstruction, 
paving, 
repaving, 
building, 
alteration, 
repair, 
restoration, 
environmental 
review or remediation, 
enlargement or other 
improvement, 
including all 
labor, 
materials, 
machinery, 
fixtures 
and 
equipment, including rolling stock or vehicles; 
D. 
Engineering, architectural, legal and other professional 
services; 
E. 
Reserves, 
insurance, 
letters 
of 
credit 
or 
other 
financial guarantees for payment of future debt service on 
bonds or notes; and 
F. 
All other costs or expenses necessary or convenient to 
such projects, including the financing or refinancing of the 
projects. 
Sec. 3. 
GARVEE financing authorized. 
Notwithstanding 
any 
other provision of law, upon certification, the bank shall issue 
from time to time up to $50,000,000 of GARVEE bonds to be repaid 
solely 
from 
annual 
federal 
transportation appropriations 
for 
funding 
of 
projects 
associated with 
the 
replacement 
of 
the 
Waldo-Hancock 
Bridge 
and 
approved 
by 
the 
Federal 
Highway 
Administration and any matching funds of the State as provided in 
this Act. 
The bank shall issue GARVEE bonds from time to time pursuant 
to a resolution to be adopted by the bank. 
The GARVEE bonds 
issued must be secured pursuant to 
a 
pledge 
and certificate 
issued by the Department of Transportation and approved by the 
State Budget Officer. 
The pledge and certificate must contain 
prov~s~ons that dedicate and pledge receipt of future federal 
transportation funds to secure the payment of the GARVEE bonds, 
including principal, interest and issuance costs. 
The terms of 
the GARVEE bonds, their repayment schedule and other provisions 
to facilitate their creditworthiness are determined by the bank 
in consultation with the Department of Transportation and the 
State Budget Officer. 
The pledge and certificate are a part of 
the 
contract 
with 
the 
holders 
of 
the 
GARVEE 
bonds 
to 
be 
authorized. 
The 
GARVEE 
bonds must be in the form, 
bear the date or 
dates, mature at the time or times and have such other terms as 
determined 
by 
the 
bank 
and 
approved 
by 
the 
Department 
of 
Transportation and the State Budget Officer, except that a GARVEE 
bond may not mature more than 20 years from the date of its issue. 
GARVEE bonds issued under the provisions of this Act do not 
constitute a debt or liability of the State or of any political 
subdivision of the State, or a pledge of the full faith and 
credit of the State or of any political subdivision of the State, 
but are payable solely from the funds and revenues pledged for 
that purpose. 
The proceeds from the sale of the GARVEE bonds are to be 
deposited into the appropriate highway fund capital account or 
other appropriate dedicated revenue account. 
Sec. 4. Maine Municipal Bond Bank provisions. 
The bank has all 
the powers and duties provided by the Maine Revised Statutes, 
Title 30-A, chapter 225, modified and supplemented as provided in 
this section for the purposes set forth in this section. 
All 
words, terms and phrases have the same meaning as provided in 
Title 30-A, chapter 225, except as modified and supplemented in 
this section for the purposes set forth in this section. 
1. 
Lendinq and borrowinq powers. 
The bank may as sis t the 
State by borrowing money to finance or refinance from time to 
time 
all 
or 
a 
portion 
of 
the 
costs 
of 
the 
qualified 
transportation project and make the proceeds of such borrowing 
available to the Department of Transportation at terms agreed 
upon by the bank, the State Budget Officer and the Department of 
Transportation. 
The principal of and interest on any bonds or 
notes issued by the bank to finance or refinance the qualified 
transportation project must be secured by a pledge of funds paid 
by the Federal Highway Administration and any matching funds of 
the State as necessary and legally available that are allocated 
for 
such 
purpose 
on 
an 
annual 
basis 
by 
the 
Department 
of 
Transportation in its sole discretion and may further be secured 
by 
a 
pledge 
of 
any 
rights, 
grants, 
reserves, 
contracts, 
agreements or other revenues or property as may be determined by 
resolution of the bank. 
Bonds, 
notes, 
leases, 
agreements or 
other forms of debt or liability entered into or issued by the 
bank under this section are not in any way a debt or liability of 
the State and do not constitute a loan of the credit of the State 
or create any debt or liability on behalf of the State or 
consti tute a pledge of the faith and credit of the State. 
Each 
bond, 
note, 
lease, 
agreement 
or 
other 
evidence 
of 
debt 
or 
liability entered into by the bank must contain a statement to 
the effect that the bank is obligated to pay the principal, 
interest, redemption premium, if any, and other amounts payable 
solely from the sources pledged for that purpose by the bank and 
that neither the faith and credit nor the taxing power of the 
State is pledged to the payment of the principal, 
interest, 
premium, charge, fee or other amount on the bond, note, lease, 
agreement or other form of indebtedness. 
2. 
Powers 
with 
respect 
to 
qualified 
transportation 
project. 
In addition to all other powers elsewhere granted to 
the 
bank, 
the 
bank 
may, 
with 
respect 
to 
the 
qualified 
transportation project: 
A. 
Acquire title to, 
or 
an interest in, 
the qualified 
transportation project; 
B. 
Make and execute contracts and all other instruments, 
including any 
amendments 
or modifications to the extent 
permitted under its contract with holders of its bonds or 
notes, with the State, the Federal Highway Administration or 
any other legal entity in furtherance of the purposes of 
this Act; and 
C. 
Lease the qualified transportation project to the State 
or any 
agency, 
political subdivision, 
instrumentality or 
department of the State to further the purposes of this Act, 
as 
long as the obligation of the State or of any such 
agency, political subdivision, instrumentality or department 
to 
make 
any 
rental 
or 
other 
payments 
are 
considered 
executory only to the extent of funds paid by the United 
States Department of Transportation and any matching funds 
of the State as necessary and legally available that are 
allocated for 
such 
purpose 
on 
an 
annual 
basis 
by 
the 
Department of Transportation in its sole discretion, as long 
as the liability on account of the State or any such agency, 
political subdivision, instrumentality or department is not 
incurred 
by 
the 
State 
or 
any 
such 
agency, 
political 
subdivision, instrumentality or department beyond the money 
available for that purpose. 
3. 
Pledqe of federal hiqhway funds. 
The Department of 
Transportation is authorized to transfer, assign or pledge any or 
all of the funds paid to it, directly or indirectly, by the 
Federal 
Highway Administration with respect to the qualified 
transportation project, together with any matching funds of the 
State as necessary and legally available that are allocated for 
such 
purpose 
on 
an 
annual 
basis 
by 
the 
Department 
of 
Transportation in its sole discretion. 
Any such pledge does not 
constitute a debt or liability on behalf of the State or of any 
political subdivision of the State or a loan of the credit of the 
State or of any political subdivision of the State or a pledge of 
the faith and credit of the State or of any political subdivision 
of the State. 
A decision by the Department of Transportation not 
to allocate such federal transportation funds or state matching 
funds as necessary and legally available in any given fiscal year 
for the payment of such bonds or notes or related costs and 
expenses may not be construed to constitute an action impairing 
any contract entered into by the bank under this Act. 
4. 
Contracts 
are 
subject 
to 
continuinq 
federal 
appropriations of federal transportation funds. 
Every contract 
relating to the issuance of bonds or notes to finance all or a 
part of the costs of the qualified transportation project must 
provide that all financial obligations of the State or of any 
agency, political subdivision, instrumentality or department of 
the State in regard to the portion of the principal of and 
interest on 
such 
bonds 
or 
notes 
and 
the 
related costs 
and 
expenses that may 
be paid 
from 
federal 
transportation funds 
pursuant to federal law and any agreement between the Federal 
Highway Administration or 
any 
agency of the Federal 
Highway 
Administration and the Department of Transportation that is or is 
to be the initial recipient of such federal transportation funds 
are 
subject 
to 
continuing 
federal 
appropriations 
of 
federal 
transportation funds at a level equal to or greater than the 
amount needed to pay the federal share of principal, interest and 
costs and expenses on such bonds or notes. 
5. 
State agency powers. 
Each 
agency, 
instrumentality, 
department or other political subdivision of the State, for the 
purpose of aiding and cooperating in the financing, construction, 
operation or maintenance of the qualified transportation project, 
has the power: 
A. 
To sell, lease, 
assign or 
otherwise 
personal property or 
property; and 
loan, donate, 
transfer 
to 
interests in 
grant, convey, 
the 
bank 
any 
any real or 
pledge, 
real 
or 
personal 
B. 
To enter into agreements, 
including loan and pledge 
agreements, 
with 
any 
person 
for 
the 
joint 
financing, 
construction, 
operation or 
maintenance 
of 
the qualified 
transportation 
project 
and 
to 
agree 
to 
make 
payments, 
without limitation as to amount except as set forth in the 
agreement, 
from revenues 
received in one or more fiscal 
years by the Department of Transportation or any person to 
defray the costs of the financing, construction, operation 
or maintenance of the qualified transportation project. 
To 
assist 
in 
the 
financing, 
construction, 
operation 
or 
maintenance 
of 
the 
qualified 
transportation 
project, 
any 
governmental unit or political subdivision may, 
by contract, 
pledge, 
assign 
or 
otherwise 
transfer 
to 
the 
Department 
of 
Transportation or otherwise as directed by the bank all or a 
portion of federal transportation funds paid to the governmental 
unit or political subdivision or the revenues 
from any other 
legally available source. 
6. 
Corporate powers. 
In addition to all other powers 
granted to the bank, for the purpose of carrying out this Act, 
the bank may: 
A. 
Make, enter into and enforce all 
necessary, 
convenient 
or 
desirable 
financing 
or 
refinancing 
the 
transportation project; 
contracts or agreements 
for 
the 
purposes 
of 
qualified 
federal 
B. 
Invest any funds or money of the bank not then required 
for funding costs of the qualified transportation project in 
the same manner as permitted for the investment of funds 
belonging to the State or held by the Treasurer of State, 
except as otherwise permitted or provided by this Act; and 
C. 
Fix and prescribe any form of application or procedure 
to be required of the State or of any agency, political 
subdivision, instrumentality or department of the State with 
respect to the qualified transportation project and fix the 
terms and conditions of the qualified transportation project 
and may enter into agreements with the State or any agency, 
political subdivision, instrumentality or department of the 
State or of 
any political subdivision of 
the State in 
connection with the qualified transportation project. 
1. 
Exception to prohibited acts and limitation of povers. 
Notwithstanding the provisions of the Maine Revised Statutes, 
Title 30-A, section 5958, the bank may make loans to the State or 
any agency, political subdivision, instrumentality or department 
of the State in connection with the financing of the qualified 
transportation project. 
8. 
Bonds and notes of bank. 
Notwithstanding the provisions 
of the Maine Revised Statutes, Title 30-A, section 6003, the bank 
may issue its bonds from time to time in any principal amounts 
that it considers necessary to provide funds for any of the 
purposes authorized by this Act, 
including the financing or 
refinancing of all or a portion of the costs of the qualified 
transportation project. 
9. 
Receipt of federal appropriation money. 
The Treasurer 
of State may receive from the Federal Government any amount of 
money as appropriated, allocated, granted, turned over or in any 
way provided for the purposes of this Act. 
In connection with 
the 
financing of the qualified transportation project, 
these 
amounts must be credited to and deposited in the Highway Fund and 
are available to the bank. 
10. 
Agreements 
with 
financial 
institutions. 
Notwithstanding the provisions of the Maine Revised Statutes, 
Title 30-A, section 6019, the bank may enter into any agreements 
or 
contracts 
with 
any 
commercial 
banks, 
trust 
companies 
or 
banking or other financial institutions within or outside the 
State that are necessary, desirable or convenient in the opinion 
of the bank to provide any other services to the bank to assist 
the bank in effectuating the purposes of this Act. 
11. 
Remedies of holders of bonds and notes. 
In addition to 
all other rights or remedies set forth in the Maine Revised 
Statutes, Title 30-A, section 6023, subsection 2, the trustee as 
appointed pursuant to that section may, and upon written request 
of the holders of 25% in principal amount of all bonds then 
outstanding that have been issued to finance or refinance all or 
a portion of the costs of the qualified transportation project 
shall, in the trustee's or the bank's own name, by mandamus or 
other suit, action or proceeding at law or in equity, enforce all 
rights of such bondholders, including the right to require the 
bank 
to 
collect 
payments 
and 
other 
amounts 
and 
to 
collect 
interest and amortization payments under agreements payable to 
the bank and pledged to payment of such bonds, adequate to carry 
out any agreement as to, or pledge of, those payments and other 
amounts and of such interest and amortization payments and to 
require the bank to carry out any other agreements with the 
bondholders and to perform its duties under this Act. 
Sec. 
5. 
Appropriations 
and 
allocations. 
The 
following 
appropriations and allocations are made. 
TRANSPORTATION, DEPAR1.'MENT OF 
Initiative: 
Provides for the allocation of additional Personal 
Services, All Other and Capital Expenditures funding to support 
the Waldo-Hancock Bridge project. 
Other Special Revenue Funds 
2003-04 
2004-05 
Personal Services 
$0 
$2,000,000 
All Other 
8,000,000 
Capital Expenditures 
40,000,000 
Other Special Revenue Funds Total 
$0 
$50,000,000 
SUMMARY 
This bill authorizes the use of federal Grant Anticipation 
Revenue Vehicles, or GARVEE, 
financing in the amount of up to 
$50,000,000 to fund projects associated with the Waldo-Hancock 
Bridge replacement. 
The GARVEE bonds will be issued by the Maine 
Municipal Bond Bank and will be repaid solely from future federal 
transportation funding apportioned to the State from the Federal 
Highway Administration and any matching funds of the State. 
The 
GARVEE bonds do not constitute a debt or liability of the State 
or a pledge of its full faith and credit.