Financing Agreements

2025-2026 Bill 891: Financing Agreements - South Carolina Legislature Online

South Carolina General Assembly
126th Session, 2025-2026
Download
This Bill
in Microsoft Word Format
Indicates Matter Stricken
Indicates New Matter
S. 891
STATUS INFORMATION
General Bill
Sponsors: Senators Corbin, Peeler, Garrett and Kennedy
Document Path: SF-0027AA26.docx
Introduced in the Senate on February 4, 2026
Currently residing in the Senate Committee on
Finance
Summary: Financing Agreements
HISTORY OF LEGISLATIVE ACTIONS

Date

Body

Action Description with journal page number

2/4/2026

Senate

Introduced and read first time (
Senate Journal-page 7
)

2/4/2026

Senate

Referred to Committee on
Finance
(
Senate Journal-page 7
)

View the latest
legislative information
at the website
VERSIONS OF THIS BILL
02/04/2026

A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING
SECTION
11-27-110
, RELATING TO LEASE PURCHASE OR FINANCING AGREEMENTS SUBJECT
TO CONSTITUTIONAL DEBT LIMITS, SO AS TO PROVIDE AN EXPANDED DEFINITION OF
FINANCING AGREEMENTS; BY AMENDING SECTION
11-27-40
, RELATING TO THE EFFECT OF
THE NEW ARTICLE X ON BONDS OF POLITICAL SUBDIVISIONS, SO AS TO PROVIDE THAT ANY
MEMBER OF A LOCAL GOVERNING BODY WHO KNOWINGLY VOTES IN FAVOR OF A PROPOSED
ACTION THAT VIOLATES SECTION 14 OF THE NEW ARTICLE X OF THE CONSTITUTION IS
GUILTY OF MISCONDUCT IN OFFICE; AND BY AMENDING SECTION
11-27-50
, RELATING TO
THE EFFECT OF THE NEW ARTICLE X ON BONDS OF SCHOOL DISTRICTS, SO AS TO PROVIDE
THAT ANY MEMBER OF A GOVERNING BODY OF THE STATE'S SCHOOL DISTRICTS WHO VOTES
IN FAVOR OF A PROPOSED ACTION THAT KNOWINGLY VIOLATES SECTION 15 OF THE NEW
ARTICLE X OF THE CONSTITUTION IS GUILTY OF MISCONDUCT IN OFFICE.

B
e it enacted by the
General Assembly of the State of South Carolina:

S
ECTION 1.
S
ection
11-27-110
(A)(6) of the S.C. Code is amended to
read:

(
6) "financing agreement" means, with
respect to any governmental entity, any contract entered into after December
31, 1995, under the terms of which a governmental entity acquires the use of an
asset which provides:

(
a)
for payments to be made in more than one fiscal year, whether by the stated
term of the contract or under any renewal provisions, optional or otherwise;

(
b)
that the payments thereunder are divided into principal and interest components
or which contain any reference to any portion of any payment under the
agreement being treated as interest;

(
c) for payments by the governmental
entity which will be utilized, directly or through any intermediary, to service
all or a portion of indebtedness of such governmental entity, intermediary or
any other entity issued for the purpose of acquiring or improving the asset;

(c)
(
d)
that title to
all or a portion of

the asset will be in the name of or be transferred to the governmental
entity if all
or a portion of the
payments
scheduled or provided for in the financing agreement are made; and

(d)
(
e)
for any contract entered into after December 31, 2006,
pursuant to which installment payments of the purchase price are to be paid by
a school district or other political subdivision to a nonprofit corporation,
political subdivision, or any other entity
.
in order to finance the acquisition, construction, renovation,
or repair of school buildings or other school facilities.
This item
shall apply to any contracts entered into after August 31, 2006, pursuant to
which installment payments of the purchase price are to be paid by a school
district or other political subdivision to a non-profit corporation, political
subdivision, or any other entity, from any source other than the issuance of
general obligation indebtedness
.

by the school district, in order to finance the acquisition,
construction, renovation, or repair of school buildings or other school
facilities.

H
owever, the term
excludes any refinancing agreement and contracts entered into in connection
with issues of general obligation bonds or revenue bonds issued pursuant to
authorization provided in Article X of the Constitution;

S
ECTION 2.
S
ection
11-27-40
of the S.C. Code is amended to read:

S
ection
11-27-40
.
T
he governing body of each of the
political subdivisions of the State shall be empowered to incur general
obligation debt for their respective political subdivisions as permitted by
Section 14, New Article X and in accordance with its provisions and limitations.

Any member of a local governing body who knows or should
have known that a proposed action violates Section 14 of New Article X of the
Constitution or the provisions of this Section and votes in favor of such an
action is guilty of misconduct in office.
All laws shall continue in
force and effect after the ratification date, but each of such laws is amended
as follows:

1
. If no election be
prescribed in such law and an election is required by New Article X, then in
every such instance, a majority vote of the qualified electors of the political
subdivision voting in the referendum herein authorized is declared a condition
precedent to the issuance of bonds pursuant to such law. The governing body of
each of the political subdivisions shall be empowered to order any such
referendum as is required by New Article X or any other provision of the
Constitution, to prescribe the notice thereof and to conduct or cause such
referendum to be conducted in the manner prescribed by Title 7, Code of Laws of
South Carolina, 1976.

2
. If an election be
prescribed by the provisions of such law, but is not required by the provisions
of New Article X, then in every such instance, no election need be held
(notwithstanding the requirement therefor in such law) and the remaining
provisions of such law shall constitute a full and complete authorization to
issue bond in accordance with such remaining provisions.

3
. If a statutory
debt limitation be prescribed by any such law, then in lieu thereof, the debt
limitation shall be that resulting from the provisions of Section 14, New
Article X.

4
. Notwithstanding
any contrary provision in any law, any issue of general obligation bonds
maturing not later than ten years from their date of issuance and in the amount
of not exceeding one million five hundred thousand dollars may be sold at
private sale and without advertisement, if not less than seven days prior to
their delivery, notice of intention to sell such bonds at private sale shall be
given by publication in a newspaper of general circulation in such political
subdivision. Such notice shall set forth the purchaser, the purchase price,
interest rates, and maturity schedule of such bonds.

5
. As permitted by
paragraph 8, Section 14 of New Article X, all political subdivisions are
authorized and empowered to incur general obligation debt in anticipation of
the collection of ad valorem taxes or licenses (tax anticipation notes). Tax
anticipation notes shall be expressed to mature not later than ninety days from
the date on which such taxes or license fees may be paid without penalty. In
the case of counties and incorporated municipalities, tax anticipation notes
shall be issued pursuant to an ordinance adopted in the manner provided by law.
In the case of any special purpose district, tax anticipation notes may be
authorized by a resolution of its governing body but such action shall be
authorized, approved, or ratified by an ordinance of the governing body or
governing bodies (as the case may be) of the county or counties wherein such
special purpose district is situate. The provisions of this item shall take
effect upon May 30, 1977.

6
. The provisions of
Chapter 17, Title 11, relating to the issuance of bond anticipation notes,
shall continue in force and effect after the ratification with respect to all
political subdivisions and the governing body of each political subdivision is
hereby authorized and empowered to issue bond anticipation notes pursuant to
and in accordance with the provisions of that chapter and the limitations
imposed by paragraph 9, Section 14 of New Article X.

7
. All laws now in
force permitting any political subdivisions to incur indebtedness (and to issue
bonds or other evidences of debt) which shall be payable solely from a
revenue-producing project or from a special source, which source does not
involve revenues from any tax or license, shall continue in force and effect
after the ratification date. Evidences of such indebtedness shall contain a
statement on the face thereof specifying the sources from which payment is to
be made and shall state that the full faith, credit, and taxing powers of the
issuer are not pledged therefor.

A
ny law containing
any provisions inconsistent herewith (including Chapter 19, Title 11, as
amended) is herewith amended by the removal therefrom of such inconsistent
provisions.

8
. The initiative and
referendum provisions contained in Article 13, Chapter 9, Title 4 and Chapter
17, Title 5 of the 1976 Code shall not be applicable to any other ordinance
authorizing the issuance of general obligation bonds unless a notice, signed by
not less than five qualified electors, of the intention to seek a referendum,
be filed both in the office of the clerk of court of the county wherein such
political subdivision is situate and with the clerk or other recording officer
of the political subdivision. Such notices of intention to seek a referendum
shall be so filed within twenty days following the publication by the governing
body of the political subdivision of notice in a newspaper of general
circulation in such political subdivision of the adoption of such ordinance.

9
. Notwithstanding
any other provision of law, a political subdivision may issue general
obligation bonds in accordance with one or more of the following provisions:

(
a)
The principal amount of the bonds maturing in a given year shall be in an
amount as prescribed by the governing body of the political subdivision. The
first maturing bonds of an issue shall mature within five years from the date
on which they are issued; and no bond shall mature later than thirty years
from the date on which it is issued.

(
b)
The bonds shall be sold at public sale, after advertisement of the sale in a
newspaper having general circulation in the State or in a financial publication
published in the City of New York. The advertisement must appear not less than
seven days prior to the date set for the sale. The advertisement may set as a
sale date a fixed date not less than seven days following publication, or the
advertisement may advise that the sale date will be at least seven days
following the date of publication. If a fixed date of sale is not set forth in
the notice of sale published in accordance with this subitem, the date selected
for the receipt of bids must be disseminated via an electronic information
service at least forty-eight hours prior to the time set for the receipt of
bids. If a fixed date of sale is set forth in the notice of sale, it may be
modified by notice disseminated via an electronic information service at least
forty-eight hours prior to the time set for the receipt of bids on the modified
date of sale. No bonds may be sold pursuant to this subitem on a date that is
more than sixty days after the date of the most recent publication of the
notice of sale. Bids for the purchase of bonds may be received in such form as
determined by the governing body of the issuer.

(
c)
The bonds may be disposed of at private sale if there are no bids received or
if all bids are rejected. The provisions of this section shall not prevent a
sale at private sale to the United States of America or any agency thereof.

(
d)
Bonds issued pursuant to this section may be issued with a provision for their
redemption prior to their maturity at par and accrued interest, plus such
redemption premium as may be prescribed by the governing body of the issuer,
but no bond shall be redeemable before maturity unless it contains a statement
to that effect. In the proceedings authorizing the issuance of the bonds,
provisions shall be made specifying the manner of call and the notice that must
be given.

S
ECTION 3.
S
ection
11-27-50
of the S.C. Code is amended to read:

S
ection
11-27-50
.
T
he board of trustees or other governing
body (the governing body) of each of the school districts of the State shall be
empowered to incur general obligation debt for their respective school
districts as permitted by Section 15 of New Article X and in accordance with
its provisions and limitations.
Any member of the board of
trustees or of any other governing body of the school districts of the State
who knows or should have known that a proposed action violates Section 15 of
New Article X of the Constitution or the provisions of this Section and votes
in favor of such an action is guilty of misconduct in office.
All laws
relating to such matters shall continue in force and effect after the
ratification date, but all such laws are amended as follows:

1
. If no election be
prescribed in such law and an election is required by New Article X, then in
every such instance, a majority vote of the qualified electors of the school
district voting in the referendum herein authorized is declared a condition
precedent to the issuance of bonds pursuant to such law. The governing body of
each of the school districts shall be empowered to order any such referendum as
is required by New Article X or any other provisions of the Constitution, to
prescribe the notice thereof and to conduct or cause to be conducted such
referendum in the manner prescribed by Article 1, Chapter 71, Title 59, Code of
Laws of South Carolina, 1976.

2
. If an election be
prescribed by the provisions of such law, but is not required by the provisions
of New Article X, then in every such instance, no election need be held and the
remaining provisions of such law shall constitute a full and complete authorization
to issue bonds in accordance with such remaining provisions.

3
. If a statutory
debt limitation be prescribed by any such law, then in lieu thereof, the debt
limitation shall be that resulting from the provisions of Section 15 of New
Article X.

4
. As permitted by
paragraph 7, Section 15 of New Article X, all school districts are authorized
and empowered to incur general obligation debt in anticipation of the
collection of ad valorem taxes (tax anticipation notes). Tax anticipation notes
shall be expressed to mature not later than ninety days from the date as of
which such taxes may be paid without penalty. Tax anticipation notes shall be
issued pursuant to a resolution adopted by the governing body.

5
. The provisions of
Chapter 17, Title 11, relating to the issuance of bond anticipation notes,
shall continue in force and effect after the ratification date with respect to
all school districts, and the governing body of each school district is hereby
authorized and empowered to issue bond anticipation notes pursuant to and in
accordance with the provisions of Chapter 17, Title 11 and the limitations
imposed by paragraph 8, Section 15 of New Article X.

6
. Notwithstanding
provision of law to the contrary, an issue of general obligation bonds maturing
not later than ten years from their date of issuance and in the amount of not
exceeding one million five hundred thousand dollars may be sold at private sale
and without advertisement, if not less than seven days prior to their delivery,
notice of intention to sell such bonds at private sale is given by publication
in a newspaper of general circulation in the school district. Such notice shall
set forth the purchaser, the purchase price, interest rates, and maturity
schedule of such bonds.

7
. Notwithstanding
any other provision of law, a school district may issue general obligation
bonds in accordance with one or more of the following provisions:

(
a)
The principal amount of the bonds maturing in a given year shall be in an
amount as prescribed by the governing body. The first maturing bonds of an
issue shall mature within five years from the date on which they are issued;
and no bond shall mature later than thirty years from the date on which it is
issued.

(
b)
The bonds shall be sold at public sale, after advertisement of the sale in a
newspaper having general circulation in the State or in a financial publication
published in the City of New York or, in the discretion of the authorities, in
both publications. The advertisement must appear not less than seven days prior
to the date set as a sale date for the sale. The advertisement may set a fixed
date not less than seven days following publication, or the advertisement may
advise that the sale date will be at least seven days following the date of
publication. If a fixed date of sale is not set forth in the notice of sale
published in accordance with this subitem, the date selected for the receipt of
bids must be disseminated via an electronic information service at least
forty-eight hours prior to the time set for the receipt of bids. If a fixed
date of sale is set forth in this notice of sale, it may be modified by notice
disseminated via an electronic information service at least forty-eight hours
prior to the time set for the receipt of bids on the modified date of sale. No
bonds may be sold pursuant to this section on a date that is more than sixty
days after the date of the most recent publication of the notice of sale. Bids
for the purchase of bonds may be received in such form as determined by the
governing body of the issuer.

(
c)
The bonds may be disposed of at private sale if there are no bids received or
if all bids are rejected. The provisions of this section shall not prevent a
sale at private sale to the United States of America or any agency thereof.

(
d)
Any bonds issued pursuant to this section may be issued with a provision for
their redemption prior to their maturity at par and accrued interest, plus such
redemption premium as may be prescribed by the governing body of the issuer,
but no bond shall be redeemable before maturity unless it contains a statement
to that effect. In the proceedings authorizing the issuance of the bonds,
provisions shall be made specifying the manner of call and the notice that must
be given.

8
. Notwithstanding
any other provision of law, bonds issued as Qualified School Construction Bonds
in amounts not exceeding one and a half million dollars pursuant to the
provisions of 26 U.S.C. Section 54F may be sold at public or private sale at
the price determined by the governing body of the issuer.

S
ECTION 4. This act takes effect upon approval
by the Governor.

----XX----

This web page was last updated on February 4, 2026 at 6:00 PM