Sinking funds; requiring levy sufficient for timely redemption; prohibiting issuance for certain period if redeemed below par. Effective date.

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SENATE FLOOR VERSION
February 17, 2025

COMMITTEE SUBSTITUTE
FOR
SENATE BILL NO. 1124 By: Sacchieri and Hamilton

[ sinking funds - levy - bond - obligation - rules -
noncompliance - codification - effective date ]

BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 452 of Title 62, unless there is
created a duplication in numbering, reads as follows:
A. For every sinking fund created for bonds issued by any
school district, not including technology center school districts,
for which an ad valorem tax is levied for the redemption of such
obligations, the millage rate shall be sufficient for the redemption
of the bond and the payment of interest or judgment in the same
period for which the bond was proposed by the district.
B. If the revenues collected from the levy and deposited to the
sinking fund are in amounts that provide for redemption of the bond
prior to the date of maturity and such bond is redeemed below par
prior to the date of maturity of the obligation, the tax levied for
the redemption of such bond shall be reduced to zero for at least

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one (1) full tax year subsequent to the year in which such bond was
redeemed. The district shall not issue any new bond, for the same
purpose or by the same authorization for which the previous bond
redeemed below par prior to the date of maturity was issued, for at
least one (1) year from the date the previous bond was redeemed.
C. The State Auditor and Inspector shall enforce the provisions
of this section. The State Auditor and Inspector may promulgate
rules and require the submission of certain documentation to enforce
the provisions of this section.
D. Any school district that does not comply with the provisions
of subsection B of this section shall receive a notice of
noncompliance from the State Auditor and Inspector. Any school
district that receives any subsequent notice of noncompliance shall
transfer five percent (5%) of the allocation of State Aid of such
district, pursuant to the provisions of Section 18-200.1 of Title 70
of the Oklahoma Statutes, to the Education Reform Revolving Fund,
created pursuant to Section 18-400 of Title 70 of the Oklahoma
Statutes, for the school year subsequent to the year of
noncompliance. Provided, for a school district receiving any
subsequent notice of noncompliance that does not receive an
allocation of State Aid, no issuance of any bond or obligation shall
exceed an amount that would necessitate the levy of a tax exceeding
a rate equal to fifty percent (50%) of the maximum levy rate

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authorized by the district for such levy, until such time the
district becomes compliant.
SECTION 2. This act shall become effective November 1, 2025.
COMMITTEE REPORT BY: COMMITTEE ON REVENUE AND TAXATION
February 17, 2025 - DO PASS AS AMENDED BY CS