NRS350A.153. Limitations and conditions upon issuance of state securities to acquire revenue securities; exceptions.

      1.  This chapter does not confer upon a municipality authority to pledge revenues for the payment of revenue securities. Any such authority must be derived from other law.

      2.  No state securities may be issued pursuant to this chapter for the purpose of acquiring revenue securities unless the governing body of the municipality issuing the revenue securities includes within the ordinance, resolution or other instrument authorizing the issuance of the revenue securities a statement authorizing the State Treasurer and any other appropriate state officer to withhold from any allocable local revenues to which the municipality is otherwise entitled an amount necessary and legally available to pay the principal and interest due on the revenue securities if the municipality fails to pay timely such principal and interest. The governing body of the municipality shall provide to the State Treasurer:

      (a) A copy of the ordinance, resolution or other instrument authorizing the issuance of the revenue securities;

      (b) A schedule of payments for the revenue securities; and

      (c) The name and address of the person from whom payments of principal and interest on the revenue securities will be received by the State Treasurer.

      3.  Payments of principal and interest on revenue securities must be due not later than 1 working day before the payments of principal and interest are due on the state securities issued to acquire the revenue securities. If a payment of the principal or interest on revenue securities is not received by the State Treasurer by the date on which the payment is due, the State Treasurer shall immediately notify the municipality to determine if the payment will be immediately forthcoming. If the payment will not be immediately forthcoming, the State Treasurer shall:

      (a) Forward the amount necessary to make the payment from any legally available money in the reserve fund created for that purpose in the bond bank fund; and

      (b) Withhold that amount from the next payment to the municipality of allocable local revenues legally available therefor. If the amount so withheld is insufficient to pay the amount due, the State Treasurer may continue to withhold any amounts necessary from subsequent payments to the municipality until the amount due is paid.

      4.  If, after being notified pursuant to this section, a municipality fails to make a payment of principal or interest on any revenue securities issued by it, the State Treasurer shall notify the Department of Taxation and request that action be taken pursuant to the provisions of NRS 354.685.

      5.  The State Controller and the Director of the Department of Administration shall approve requisitions or transfers required pursuant to this section and take such other action as is necessary to carry out the provisions of this section.

      6.  The provisions of subsections 2 to 5, inclusive, do not:

      (a) Apply to municipal bonds issued on or before June 30, 2011, where the bondholder or issuer may claim or receive a tax credit pursuant to the provisions of the Internal Revenue Code.

      (b) Authorize state taxes to be pledged to pay special obligations of the State.

      (Added to NRS by 1993, 2317; A 1995, 1897; 2009, 2660)