Bonds: fine for unauthorized use.

The State General Obligation Bond Law provides procedures for use in authorizing the issuance and sale and providing for the repayment of state general obligation bonds. This bill would incorporate into the State General Obligation Bond Law a provision that provides that if the Department of Finance determines that funds from a bond act are expended for a purpose not authorized by the bond act, and the entity that is authorized to allocate funds from the sale of bonds does not take the corrective action or measure prescribed by the department within 60 days of receiving notice of the corrective action or measure from the department, then the Department of Finance may prohibit the entity that was responsible for the unauthorized use from allocating any additional funds from the sale of those bonds. The bill would provide that its provisions apply only to the allocation of funds that are authorized under a bond act that is adopted on or after January 1, 2013.