Committee hears bill to extend bond-validation window to cover issues since March 16, 2023

Representative Julie Darling introduced House Bill 63 at a hearing before the Senate State Administration Committee, asking members to update the Bond Validation Act so it would retroactively validate state and local bond issues with procedural or authorization shortcomings that occurred after March 16, 2023.

The measure, Darling said, is the annual update the Department of Administration requests so that bond issues issued after the last update remain protected. “This is a bill that we bring every year,” Representative Julie Darling said, noting the provision has been updated regularly since 1947.

Proponents described the statute as a safeguard for investors and the broader public-finance market. “Validation act does allow for, protection of investors, in the event of an error for a state and local state and or local bond issuance. That might challenge the validity of that bond,” said Kristen Reynolds during her testimony. Courtney Ellis, an attorney at Dorsey & Whitney who said she serves as bond counsel in the state, added the act “helps provide another important layer of security for investors, which in turn provides stability and predictability in the public finance marketplace for the state and Montana local governments.”

Committee members recorded no questions and no opponents appeared at the hearing. Representative Darling closed by asking the committee for a “due pass.” No committee vote or final action was recorded at the hearing.

Clarifying details from testimony: the bill would update the Bond Validation Act’s effective date to the bill’s effective date to cover bond issues issued since March 16, 2023; proponents described the validation provision as a long-standing, routine statutory extension used in each regular session since 1947.

The committee held the hearing; proponents asked for committee passage but the transcript records no formal committee vote or final disposition of House Bill 63.