§6.  State Debt; Full Faith and Credit Obligations

Section 6.(A)  Authorization.  Unless otherwise authorized by this constitution, the state shall have no power, directly or indirectly, or through any state board, agency, commission, or otherwise, to incur debt or issue bonds except by law enacted by two-thirds of the elected members of each house of the legislature.  The debt may be incurred or the bonds issued only if the funds are to be used to repel invasion; suppress insurrection; provide relief from natural catastrophes; refund outstanding indebtedness at the same or a lower effective interest rate; or make capital improvements, but only in accordance with a comprehensive capital budget, which the legislature shall adopt.

(B)  Capital Improvements.  (1)  If the purpose is to make capital improvements, the nature and location and, if more than one project, the amount allocated to each and the order of priority shall be stated in the comprehensive capital budget which the legislature adopts.

(2)  The estimated amount of debt service to be paid for capital improvements for the next fiscal year shall be stated as a separate item and by budget unit in the budget estimate required to be submitted by the governor in accordance with Section 11 of this Article.

(C)  Full Faith and Credit.  The full faith and credit of the state shall be pledged to the repayment of all bonds or other evidences of indebtedness issued by the state directly or through any state board, agency, or commission pursuant to the provisions of Paragraphs (A) and (B) hereof.  The full faith and credit of the state is not hereby pledged to the repayment of bonds of a levee district, political subdivision, or local public agency.  In addition, any state board, agency, or commission authorized by law to issue bonds, in the manner so authorized and with the approval of the State Bond Commission or its successor, may issue bonds which are payable from fees, rates, rentals, tolls, charges, grants, or other receipts or income derived by or in connection with an undertaking, facility, project, or any combination thereof, without a pledge of the full faith and credit of the state.  Such revenue bonds may, but are not required to, be issued in accordance with the provisions of Paragraphs (A) and (B) hereof.  If issued other than as provided in Paragraphs (A) and (B), such revenue bonds shall not carry the pledge of the full faith and credit of the state and the issuance of the bonds shall not constitute the incurring of state debt under this constitution.  The rights granted to deep-water port commissions or deep-water port, harbor, and terminal districts under this constitution shall not be impaired by this Section.

(D)  Referendum.  The legislature, by law enacted by two-thirds of the elected members of each house, may propose a statewide public referendum to authorize incurrence of debt for any purpose for which the legislature is not herein authorized to incur debt.

(E)  Exception.  Nothing in this Section shall apply to any levee district, political subdivision, or local public agency unless the full faith and credit of the state is pledged to the payment of the bonds of the levee district, political subdivision, or local public agency.

(F)  Limitation.  (1)  The legislature shall provide for the determination of a limit to the amount of net state tax supported debt which may be issued by the state in any fiscal year.  Net state tax supported debt shall be defined by law.  When enacted, such definition shall not be changed except by specific legislative instrument which receives a favorable vote of two-thirds of the elected members of each house of the legislature.  The limitation shall be established so that by Fiscal Year 2003-2004 and thereafter the amount necessary to service outstanding net state tax supported debt shall not exceed six percent of the estimate of money to be received by the state general fund and dedicated funds contained in the official forecast adopted by the Revenue Estimating Conference at its first meeting after the beginning of each fiscal year and any other money required to be included in the estimate by this Paragraph.  In making such estimate, the conference shall include all amounts which are to be used to service net state tax supported debt.  For purposes of this Paragraph, servicing outstanding net state tax supported debt includes payments of principal, interest, and sinking fund requirements.  The limitation established pursuant to this Paragraph shall not be construed to prevent the payment of debt service on net state tax supported debt.

(2)  The limitation established pursuant to this Paragraph may be changed by passage of a specific legislative instrument by a favorable vote of two-thirds of the elected members of each house of the legislature.  The limitation may be exceeded by passage of a specific legislative instrument for a project or related projects by a favorable vote of two-thirds of the elected members of each house of the legislature, provided that any debt service payment required for such projects shall, once bonds have been issued in connection therewith, not be impaired in any future year by application of this limitation.  The limitation established pursuant to this Subparagraph shall be deemed to be increased as necessary to accommodate any projects approved to exceed this limit if approved as provided in this Paragraph, but only as long as there are bonds outstanding for the projects.

(3)  Except as provided in Subparagraph (2) of this Paragraph, the State Bond Commission shall not approve the issuance of any net state tax supported debt, the debt service requirement of which would cause the limit herein established to be exceeded.

Amended by Acts 1993, No. 1043, §1, approved Oct. 16, 1993, eff. Nov. 18, 1993; Acts 1993, No. 1044, §1, approved Oct. 16, 1993, eff. Nov. 18, 1993.