The NHS Act of 1995 amended Section 122 of Title 23 of the US Code to make bond-related costs eligible for Federal reimbursement on any Federal-aid project eligible under Title 23, U.S.C. The definition of construction was also revised in 23 U.S.C. 101 to include a reference to bond-related costs. These are the Federal legislative actions that established GARVEE bonds as a tool available to states.
More about GARVEEs in the Financing section of the BATIC Institute website
Before issuing GARVEE bonds states must first enact enabling legislation allowing them to collateralize transportation funds received from the Federal government. The examples below provide summaries of and links to GARVEE enabling legislation passed in several states. The selected legislation is predominantly from the late 1990s or early 2000s; this is due to the fact that many states chose to act quickly after federal legislation granted authority to use GARVEEs as a financial tool. The BATIC Institute is unaware of any "recent" examples of state GARVEE enabling legislation.
The links below provide the sections of the Arizona Code pertaining to the use of GARVEE bonds in the state. Arizona was one of the first states to issue GARVEE bonds.
§28-7611 - Definitions
§28-7612 - Grant anticipation notes
§28-7613 - Refund
§28-7614 - Limitations
§28-7615 - Application of grant revenues; grant anticipation notes fund; payment of notes
§28-7616 - Use of proceeds
§28-7617 - Nature of grant anticipation notes; limited obligation
The 82nd Arkansas General Assembly (1999) first granted GARVEE authority upon the passage of HB 1500 and 1548 (Acts 1027 and 1028). This legislation was developed with broad-based support. Act 1027, which was approved by voters by a nearly 4 to 1 margin in a statewide election June 15, 1999, enables the state to take advantage of the GARVEE provision passed in 1998 by Congress as part of a new Federal highway bill.
Subsequent Arkansas Highway Financing Acts provide authority for the use of GARVEE bonds, most recently the Arkansas Highway Financing Act of 2011 (Ark. Stat. Ann. §§27-64-504 et seq.).
In 1999, the California Legislature, in cooperation with the California Transportation Commission (CTC), the state DOT and regional transportation agencies, passed legislation to authorize the use the GARVEE bonds to accelerate funding for eligible and designated transportation projects. Cal. Government Code §§14550 et seq. established guidelines for project eligibility and the implementation of GARVEE bond funding allocations and enacted related technical provisions.
The Colorado Legislature passed legislation in 1999 creating a section of state code titled Transportation Revenue Anticipation Notes, located in Colo. Rev. Stat. §§43-4-701 et seq.
The General Florida GARVEE Statute (Fla. Stat. §215.616), describes the way in which the GARVEE program is administered in Florida. It was first passed in 1999.
The State Legislature approved S.B. 1183 in April 2005, enabling the state to issue GARVEE bonds. Idaho has used GARVEEs to support the Connecting Idaho Vision providing a 2,076-mile network of high performance roadways in the state. The following are relevant sections of the Idaho Code:
Section 40-315 establishes the duties and powers of the Idaho Transportation Board and list of eligible projects. Subsequent 2007 legislation established sole authority to allocate GARVEE bond proceeds to the Idaho Transportation Board. The legislature retained the authority to approve a total GARVEE bond amount on an annual basis.
Section 40-702 defines procedures for the deposit of Federal transportation funds into Idaho State Highway Account.
Section 40-707 enables the use of State Highway Account fund to pay GARVEE debt service.
Section 40-718 establishes GARVEE debt service and capital project funds.
Section 67-6206 establishes the authority for the Idaho housing and finance association to enter into financial agreements for the purpose of transportation projects. Additionally grants the association the power to issue bonds for transportation as recommended by the transportation board.
Section 67-6210 defines the roles and authority of the Idaho Housing and Finance Association and the Idaho Transportation Board in issuing GARVEE debt.
La. Rev. Stat. Ann. §27 was established by the Grant Anticipation Revenue Vehicle Act of 2002, and provides authority to the State Bond Commission to use GARVEE bonds. Subsequent legislation in 2015 refined this section of code.
