(1) As used in this section: (a) "Bonds" means any bond, note, lease, or other obligation of a governmental unit. (b) (i) "General obligation bond" means a bond, note, warrant, certificate of indebtedness, or other obligation of a local political subdivision that: (A) is payable in whole or in part from revenues derived from ad valorem taxes; and (B) constitutes an indebtedness within the meaning of any applicable constitutional or statutory debt limitation. (ii) "General obligation bond" includes a general obligation tax, revenue, or bond anticipation note issued by a local political subdivision that is payable in whole or in part from revenues derived from ad valorem taxes. (c) "Governmental unit" has the meaning assigned in Section 70A-9a-102. (d) "Pledge" means the creation of a security interest of any kind. (e) "Property" means any property or interests in property, other than real property. (f) "Security agreement" means any resolution, ordinance, indenture, document, or other agreement or instrument under which the revenues, fees, rents, charges, taxes, or other property are pledged to secure the bonds. (2) This section expressly governs the creation, perfection, priority, and enforcement of a security interest created by the state or a governmental unit of the state, notwithstanding anything in Title 70A, Chapter 9a, Uniform Commercial Code - Secured Transactions, to the contrary. (3) (a) The revenues, fees, rents, charges, taxes, or other property pledged by a governmental unit for the purpose of securing its bonds are immediately subject to the lien of the pledge. (b) (i) The lien is a perfected lien upon the effective date of the security agreement. (ii) The physical delivery, filing, or recording of a security agreement or financing statement under the Uniform Commercial Code or otherwise, or any other similar act, is not necessary to perfect the lien. (c) The lien of any pledge is valid, binding, perfected, and enforceable from the time the pledge is made. (d) The lien of the pledge has priority: (i) based on the time of the creation of the pledge unless otherwise provided in the security agreement; and (ii) as against all parties having claims of any kind in tort, contract, or otherwise against the governmental unit, regardless of whether or not the parties have notice of the lien. (e) Each pledge and security agreement made for the benefit or security of any of the bonds shall continue to be effective until: (i) the principal, interest, and premium, if any, on the bonds have been fully paid; (ii) provision for payment has been made; or (iii) the lien created by the security agreement has been released by agreement of the parties in interest or as provided by the security agreement that created the lien. (4) (a) General obligation bonds issued and sold by or on behalf of a local political subdivision shall be secured by a first statutory lien on all revenues received pursuant to the levy and collection of ad valorem taxes. (b) The lien described in Subsection (4)(a): (i) arises and attaches immediately to the ad valorem tax revenues without the need for any action or authorization by the local political subdivision; (ii) is valid and binding from the time the general obligation bonds are executed and delivered; and (iii) is effective, binding, and enforceable against the local political subdivision, its successors, transferees, and creditors, and all others asserting rights to the ad valorem tax revenues. (c) A lien described in Subsection (4)(a) is enforceable against the parties described in Subsection (4)(b)(iii): (i) regardless of whether the parties described in Subsection (4)(b)(iii) have notice of the lien; and (ii) without the need for any physical delivery, recordation, filing, or further action. (5) Any amounts appropriated or added to the tax levy to pay principal of and premium and interest on general obligation bonds: (a) shall be applied solely to the payment of those general obligation bonds; and (b) may not be used for any other purpose, except as provided by law. (6) This section applies to all revenues received pursuant to the levy and collection of the ad valorem tax regardless of the date on which the general obligation bonds were issued. (7) This section applies to all bonds, including bonds issued before or after the effective date of this section.
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