By:  Sims                                              S.B. No. 968
                                 A BILL TO BE ENTITLED
                                        AN ACT
    1-1  relating to the creation, re-creation, administration, powers and
    1-2  duties including the power to issue bonds and the power of eminent
    1-3  domain, validation, and dissolution of rural rail transportation
    1-4  districts.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  Chapter 623, Acts of the 67th Legislature,
    1-7  Regular Session, 1981 (Article 6550c, Vernon's Texas Civil
    1-8  Statutes), is amended by amending Sections 1 through 6 and adding
    1-9  Section 6A to read as follows:
   1-10        Sec. 1.  Findings.  The legislature finds that:
   1-11              (1)  the state contains many rural areas that are
   1-12  heavily dependent on agriculture for economic survival;
   1-13              (2)  transportation of agricultural and industrial
   1-14  products is essential to the continued economic vitality of rural
   1-15  areas;
   1-16              (3)  the rail transportation systems in some rural
   1-17  areas are threatened by railroad bankruptcies and abandonment
   1-18  proceedings that would cause the cessation of rail services to the
   1-19  areas; <and>
   1-20              (4)  it is in the interest of all citizens of the state
   1-21  that existing rail systems be maintained for the most efficient and
   1-22  economical movement of essential agricultural products from the
   1-23  areas of production to the local, national, and export markets;
   1-24              (5)  rural rail transportation districts are
    2-1  appropriate political subdivisions to provide for the continued
    2-2  operation of railroads, which are declared by Article X, Section 2,
    2-3  of the Texas Constitution to be public highways;
    2-4              (6)  the creation, re-creation, financing, maintenance,
    2-5  and operation of rural rail transportation districts and facilities
    2-6  acquired by the districts under this Act will help develop,
    2-7  maintain, and diversify the economy of the state, eliminate
    2-8  unemployment or underemployment, foster the growth of enterprises
    2-9  based on agriculture, and serve to develop and expand
   2-10  transportation and commerce within the state under the authority
   2-11  granted by Article III, Section 52-a, of the Texas Constitution;
   2-12  and
   2-13              (7)  financing by rural rail transportation districts
   2-14  for the purposes provided by this Act is a lawful and valid public
   2-15  purpose.
   2-16        Sec. 2.  Definitions.  In this Act:
   2-17              (1)  "Board" means the board of directors of a rural
   2-18  rail transportation district <system>.
   2-19              (2)  "Bonds" means bonds; notes, including bond
   2-20  anticipation notes, revenue anticipation notes, and grant
   2-21  anticipation notes; warrants; certificates of obligation;
   2-22  interest-bearing contracts; interest-bearing leases of property;
   2-23  equipment trust certificates; commercial paper; and any obligation
   2-24  issued to refund any type of bond.
   2-25              (3)  "Concurrent orders" means the orders adopted by
   2-26  eligible counties that contain identical provisions regarding the
   2-27  creation or re-creation of a district.
    3-1              (4)  "District" means a rural rail transportation
    3-2  district created under this Act.
    3-3              (5)  "Earthworks and structures" includes the clearing
    3-4  and grubbing of right-of-way; demolition of structures; relocation
    3-5  of utilities, pipelines, and any other obstacles in right-of-way;
    3-6  stripping and stockpiling; removal of subsoils for embankment or
    3-7  spoil; borrow pits; dressing and seeding of slopes; construction of
    3-8  culverts; road crossings; bridges; restoration of roadway; drainage
    3-9  within a right-of-way or along road networks; and restoration of a
   3-10  hydrologic system.
   3-11              (6)  "Eligible counties" means two or more counties
   3-12  that meet the requirements of Sections 3(a) and (b) of this Act.
   3-13              (7)  "Operating contract" means a professional services
   3-14  contract executed by a district and another person under which the
   3-15  person agrees to provide:
   3-16                    (A)  all or part of the rolling stock required
   3-17  for operation as a common carrier over all or a part of the rail
   3-18  facilities of the district; and
   3-19                    (B)  all or part of the personnel required for
   3-20  the operation of the rolling stock owned or leased by the district
   3-21  or for the operation of the rail facilities of the district.
   3-22              (8)  "Maintenance and operating expenses" means all
   3-23  expenses of operating and maintaining a district and its rail
   3-24  facilities, including all compensation, labor, materials, repairs,
   3-25  and extensions necessary, required, or convenient in the discretion
   3-26  of the board to render efficient service or to maintain and operate
   3-27  the district, and taxes or other amounts paid, payable, or to be
    4-1  paid to the United States pursuant to Section 148(f) of the
    4-2  Internal Revenue Code of 1986 (26 U.S.C. Section 148), or any
    4-3  similar law.
    4-4              (9)  "Maintenance facility" includes a workshop, a
    4-5  service, storage, security, or personnel facility, temporary or
    4-6  transient lodging for district employees, and equipment for any
    4-7  type of facility.
    4-8              (10)  "Person" has the meaning assigned by Section
    4-9  311.005, Government Code.
   4-10              (11)  "Rail facilities" means any real, personal, or
   4-11  mixed property, or any interest in that property that is determined
   4-12  by the board to be necessary or convenient for the provision of a
   4-13  rural rail transportation system and all property or interests
   4-14  necessary or convenient for the acquiring, providing, constructing,
   4-15  enlarging, remodeling, renovating, improving, furnishing, using, or
   4-16  equipping of the system, including rights-of-way, earthworks and
   4-17  structures, trackwork, train controls, stations, rolling stock, and
   4-18  maintenance facilities.
   4-19              (12)  "Revenues" means all income, receipts, and
   4-20  collections received by, to be received by, or pledged to the
   4-21  district from or by any source, except a restricted gift or a grant
   4-22  in aid of construction.
   4-23              (13)  "Right-of-way" means a right of passage over
   4-24  property; a strip of land in length and width determined required,
   4-25  necessary, or convenient by the board over, on, or under which
   4-26  trackwork is or is to be constructed or acquired; or a right of
   4-27  precedential passing.
    5-1              (14)  "Rolling stock" means locomotives, engines, rail
    5-2  cars, repair construction cars, or other cars designed to operate
    5-3  on trackwork.
    5-4              (15)  "Station" means a passenger or freight service
    5-5  building, terminal, or station, ticketing facility, waiting area,
    5-6  platform, concession, elevator, escalator, facility for handicapped
    5-7  access, access road, parking facility for passengers, baggage
    5-8  handling facility, local maintenance facility, and offices for
    5-9  district purposes, together with any interest in real property
   5-10  necessary or convenient for any of the listed items.
   5-11              (16)  "Trackwork" means track, track beds, track bed
   5-12  preparation, ties, rail fasteners, slabs, rails, emergency
   5-13  crossovers, setout tracks, storage track, and switches.
   5-14              (17)  "Train controls" includes signalling,
   5-15  interlocking equipment, speed monitoring equipment, emergency
   5-16  braking systems, central traffic control facilities, and
   5-17  communication systems.
   5-18              <(3)  "System" means all real and personal property
   5-19  held or used for rail transportation purposes, including land,
   5-20  easements, rights-of-way, other interests in land, franchises,
   5-21  stations, platforms, terminals, garages, shops, control houses,
   5-22  other buildings and structures, rolling stock, tracks, signals,
   5-23  other equipment, supplies, and other facilities necessary or
   5-24  convenient for the use of or access to rail transportation.>
   5-25        Sec. 3.  CREATION, RE-CREATION, OR DISSOLUTION OF DISTRICT.
   5-26  (a)  The commissioners courts of two or more eligible counties
   5-27  that, taken together, constitute a contiguous geographic area may
    6-1  by order create or re-create a rural rail transportation district
    6-2  consisting of the territory of the counties whose commissioners
    6-3  courts adopt the order.
    6-4        (b)  <After approval by the board of directors of a district,
    6-5  the commissioners court of an eligible county by order may include
    6-6  the territory of that county in the district.>
    6-7        <(c)>  A county eligible to create or re-create <form or
    6-8  join> a district is one in which is located a rail line that is in
    6-9  the process of being or has been abandoned through a bankruptcy
   6-10  court or Interstate Commerce Commission proceeding, or any line
   6-11  carrying 3 million gross tons per mile per year or less.
   6-12        (c)  The commissioners courts of two or more eligible
   6-13  counties that create a district or provide for the re-creation of a
   6-14  district by the addition of one or more counties shall by
   6-15  concurrent order at the time of creation or re-creation:
   6-16              (1)  declare the boundaries of the district as the
   6-17  boundaries of the counties included;
   6-18              (2)  designate the name of the district; and
   6-19              (3)  designate the number of board members, which may
   6-20  not be less than four, and the manner of their appointment.
   6-21        (d)  The commissioners courts of all counties included within
   6-22  a district by order may provide for the dissolution of the district
   6-23  if:
   6-24              (1)  the commissioners courts determine that the
   6-25  dissolution will not impair an obligation of any contract of the
   6-26  district; and
   6-27              (2)  the dissolution order will become effective only
    7-1  on the creation or re-creation of another district in which each
    7-2  county included within the dissolving district is included.
    7-3        (e)  A district created or re-created under this section
    7-4  automatically assumes any obligation of a contract executed by the
    7-5  district or a predecessor district and in force on the date of the
    7-6  creation or re-creation unless the contract expressly expires on
    7-7  the date of dissolution or re-creation of the district that
    7-8  executed the contract.
    7-9        Sec. 4.  Board of Directors; Employees.  (a)  <Each
   7-10  commissioners court that participates in the creation of or joins a
   7-11  district shall appoint one person to be a member of the board of
   7-12  directors of the district.  Provided however, that if the district
   7-13  shall be composed of three counties or less, then each
   7-14  commissioners court shall appoint two directors to the board of
   7-15  directors.>  The board of directors is responsible for the
   7-16  management, operation, and control of the district.
   7-17        (b)  To be eligible for appointment to the board, a person
   7-18  must be a resident of the district.  A board member serves for a
   7-19  term of two years ending on the second anniversary of the latest
   7-20  date a concurrent order was adopted creating or re-creating the
   7-21  district.  A vacancy on the board shall be filled for the remainder
   7-22  of the term by the commissioners court that appointed the member
   7-23  who vacated the position.  A board member may be removed from
   7-24  office for neglect of duty or malfeasance in office by the
   7-25  commissioners court that appointed the member, after at least 10
   7-26  days' written notice to the member and a hearing before the
   7-27  commissioners court.  At a hearing on the question of removal of a
    8-1  board member, the board member is entitled to be heard in person or
    8-2  through counsel.
    8-3        (c)  Members of the board shall select a president,
    8-4  vice-president, treasurer, and secretary.  The secretary is not
    8-5  required to be a board member <their presiding officers>.  The
    8-6  board shall hold at least one regular meeting each month for the
    8-7  purpose of transacting business of the district.  The president
    8-8  <presiding officer> may call special meetings of the board.  A
    8-9  majority of the members is a quorum.
   8-10        (d)  The board shall adopt rules for its proceedings and may
   8-11  employ and compensate persons to carry out the powers and duties of
   8-12  the district.  The right to control and regulate the affairs of the
   8-13  district is vested exclusively in the board except as specifically
   8-14  otherwise provided by this Act.
   8-15        (e)  A board member or employee of a district may not be
   8-16  pecuniarily interested, directly or indirectly, in any contract or
   8-17  agreement to which the district is a party.
   8-18        (f)  Notice of a meeting of the board shall be posted at the
   8-19  administrative office of the district and at the courthouse in the
   8-20  county in which that office is located.  In all other respects
   8-21  Chapter 271, Acts of the 60th Legislature, Regular Session, 1967
   8-22  (Article 6252-17, Vernon's Texas Civil Statutes), applies to
   8-23  meetings of the board.
   8-24        Sec. 5.  POWERS AND DUTIES OF DISTRICT.  (a)  A rural rail
   8-25  transportation district is a public body and a  political
   8-26  subdivision of the state exercising public and essential
   8-27  governmental functions and having all the powers necessary or
    9-1  convenient to carry out the purposes of this Act, including the
    9-2  powers granted in this section.  A district, in the exercise of
    9-3  powers under this Act, is performing only governmental functions
    9-4  and is a "governmental unit" within the meaning of Chapter 101,
    9-5  Civil Practice and Remedies Code.  A district is a "local
    9-6  government" under Chapter 1084, Acts of the 70th Legislature,
    9-7  Regular Session, 1987 (Article 715c, Vernon's Texas Civil
    9-8  Statutes); an "issuer" under Chapter 503, Acts of the 54th
    9-9  Legislature, 1955 (Article 717k, Vernon's Texas Civil Statutes),
   9-10  Chapter 784, Acts of the 61st Legislature, Regular Session, 1969
   9-11  (Article 717k-3, Vernon's Texas Civil  Statutes), the Bond
   9-12  Procedures Act of 1981 (Article 717k-6, Vernon's Texas Civil
   9-13  Statutes), Chapter 53, Acts of the 70th Legislature, 2nd Called
   9-14  Session, 1987 (Article 717k-8, Vernon's Texas Civil Statutes), and
   9-15  Chapter 656, Acts of the 68th Legislature, Regular Session, 1983
   9-16  (Article 717q, Vernon's Texas Civil Statutes); and a "public
   9-17  agency" under Chapter 3, Acts of the 61st Legislature, Regular
   9-18  Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes), and
   9-19  Chapter 400, Acts of the 66th Legislature, 1979 (Article 717m-1,
   9-20  Vernon's Texas Civil Statutes).  The acquisition, improvement, or
   9-21  repair of rail facilities by a district is an "eligible project"
   9-22  under Chapter 656, Acts of the 68th Legislature, Regular Session,
   9-23  1983 (Article 717q, Vernon's Texas Civil Statutes).
   9-24        (b)  A district has perpetual succession.
   9-25        (c)  A district may sue and be sued in all courts of
   9-26  competent jurisdiction, may institute and prosecute suits without
   9-27  giving security for costs, and may appeal from a judgment without
   10-1  giving supersedeas or cost bond.  An action at law or in equity
   10-2  against the district shall be brought in the county in which the
   10-3  principal office of the district is located, except that in eminent
   10-4  domain proceedings suit shall be brought in the county in which the
   10-5  land is located.
   10-6        (d)  A district may acquire by grant, purchase, gift, devise,
   10-7  lease, or otherwise and may hold, use, sell, lease, or dispose of
   10-8  real and personal property, licenses, patents, rights, and
   10-9  interests necessary, convenient, or useful for the full exercise of
  10-10  any of its powers under this Act.
  10-11        (e)  A district may plan, acquire, construct, complete,
  10-12  develop, own, operate, and maintain rail facilities inside or
  10-13  outside the district, and for those purposes subject to a grant
  10-14  previously secured or with the consent of any municipality, county,
  10-15  or other political subdivision may use streets, alleys, roads,
  10-16  highways, and other public ways of any municipality, county, or
  10-17  other political subdivision and may relocate, raise, reroute,
  10-18  change the grade of, or alter, at the expense of the district, the
  10-19  construction of any street, alley, highway, road, railroad,
  10-20  electric lines and facilities, telegraph and telephone properties
  10-21  and facilities, pipelines and facilities, conduits and facilities,
  10-22  and other properties, whether publicly or privately owned, as
  10-23  necessary or useful in the construction, reconstruction, repair,
  10-24  maintenance, and operation of rail facilities.  A district may
  10-25  acquire by purchase, whenever it considers the purchase expedient,
  10-26  any land, property rights, right-of-way, franchises, easements, and
  10-27  other interests in land as it considers necessary for the
   11-1  acquisition, construction, or operation of any rail facility on
   11-2  such terms and at such price as agreed to between the district and
   11-3  the owner and may take title in the name of the district.  The
   11-4  governing body of every municipality, county, other political
   11-5  subdivision, or public agency is authorized without any form of
   11-6  advertisement to make conveyance of title or rights and easements
   11-7  to any property needed by the district to effect its purposes in
   11-8  connection with the acquisition, construction, or operation of rail
   11-9  facilities <a system within its boundaries, both inside and outside
  11-10  the limits of incorporated cities, towns, and villages, and has the
  11-11  right to use the streets, alleys, roads, highways, and other public
  11-12  ways and to relocate, raise, lower, reroute, regulate, change the
  11-13  grade of, and alter the construction of any street, alley, highway,
  11-14  or road; any railroad track, bridge, or other facility or property;
  11-15  any gas transmission or distribution pipes, pipelines, mains, or
  11-16  other facility or property; any water, sanitary sewer, or storm
  11-17  sewer pipes, pipelines, or other facility or property; any electric
  11-18  lines, telegraph or telephone facility or property; any cable
  11-19  television lines, cables, conduits, or other facility or property;
  11-20  and pipelines and facilities, conduits and facilities, or other
  11-21  property whether publicly or privately owned, in the construction,
  11-22  reconstruction, repair, maintenance, or operation of the system.  A
  11-23  district shall pay the cost of any change made under this
  11-24  subsection and is liable for any damage to property occurring
  11-25  because of the change>.
  11-26        (f)  A district has the right of eminent domain to acquire
  11-27  lands in fee simple and any interest less than fee simple in, on,
   12-1  under, or above lands, including, without limitation, easements,
   12-2  rights-of-way, rights of use of airspace or subsurface space.  The
   12-3  right may not be exercised in a manner that would unduly interfere
   12-4  with interstate commerce <or unduly impair the neighborhood
   12-5  character of property surrounding or adjacent to the property
   12-6  sought to be condemned>.  Eminent domain proceedings brought by a
   12-7  district are governed by Title 52, Revised <Civil> Statutes <of
   12-8  Texas, 1925>, except as it is inconsistent with this Act.
   12-9  Proceedings for the exercise of the power of eminent domain are
  12-10  commenced by the adoption by the board of a resolution declaring
  12-11  the public necessity for the acquisition by the district of the
  12-12  property or interest described in the resolution, and that the
  12-13  acquisition is necessary and proper for the construction,
  12-14  extension, improvement, or development of rail facilities <the
  12-15  system> and is in the public interest.  The resolution of the
  12-16  district is conclusive evidence of the public necessity of the
  12-17  proposed acquisition and that the real or personal property or
  12-18  interest in property is necessary for public use.
  12-19        (g)  A district may enter into agreements with any other
  12-20  public utility, private utility, communication system, common
  12-21  carrier, or transportation system for the joint use of its
  12-22  facilities, installations, or properties within or outside the
  12-23  district and establish through routes, joint fares, and, subject to
  12-24  approval of any tariff-regulating body having jurisdiction,
  12-25  divisions of tariffs.
  12-26        (h)  A district may adopt rules to govern the operation of
  12-27  the district, its employees, the rail facilities, service provided
   13-1  by the district, and any other necessary matter concerning its
   13-2  purposes, including rules regarding health, safety, alcohol or
   13-3  beverage service, food service, and telephone and utility services,
   13-4  to protect the health, safety, and general welfare of the state.
   13-5        (i)  A district may enter into joint ownership agreements
   13-6  with any person.
   13-7        (j)  A district shall establish and maintain rents or other
   13-8  compensation for the use of the facilities of the system acquired,
   13-9  constructed, operated, regulated, or maintained by the district
  13-10  that are reasonable and nondiscriminatory and, together with grants
  13-11  received by the district, are sufficient to produce revenues
  13-12  adequate:
  13-13              (1)  to pay all expenses necessary to the operation and
  13-14  maintenance of the properties and facilities of the district;
  13-15              (2)  to pay the interest on and principal of all bonds
  13-16  issued by the district under this Act payable in whole or in part
  13-17  from the revenues, as they become due and payable; and
  13-18              (3)  to fulfill the terms of any agreements made with
  13-19  the holders of bonds or with any person in their behalf.
  13-20        (k) <(i)>  A district may make contracts, leases, and
  13-21  agreements with, and accept grants and loans from the United States
  13-22  of America, its departments and agencies, the state, its agencies,
  13-23  and political subdivisions, and public or private corporations and
  13-24  persons, and may generally perform all acts necessary for the full
  13-25  exercise of the powers vested in it.  A district may acquire
  13-26  rolling stock or other property under conditional sales contracts,
  13-27  leases, equipment trust certificates, or any other form of contract
   14-1  or trust agreement.  Any revenue bond indenture may provide
   14-2  limitations on the exercise of the powers granted by this section,
   14-3  and the limitations apply so long as any of the revenue bonds
   14-4  issued pursuant to the indenture are outstanding and unpaid.
   14-5        (l) <(j)>  A district may sell, lease, convey, or otherwise
   14-6  dispose of any of its rights, interests, or properties not needed
   14-7  for or, in the case of leases, not inconsistent with the efficient
   14-8  operation and maintenance of the system.  It may, on adoption of an
   14-9  order by the board, sell, lease, or otherwise dispose of, at any
  14-10  time, any surplus materials or personal or real property not needed
  14-11  for its requirements or for the purpose of carrying out its power
  14-12  under this Act.
  14-13        (m) <(k)>  A district by resolution may adopt rules and
  14-14  regulations governing the use, operation, and maintenance of the
  14-15  system and shall determine all routings and change them whenever
  14-16  the board considers it advisable.
  14-17        (n) <(l)>  A district may lease the rail facilities <system>
  14-18  or any part to, or contract for the use or operation of the rail
  14-19  facilities <system> or any part by, any operator.  A district shall
  14-20  encourage to the maximum extent practicable the participation of
  14-21  private enterprise in the operation of rail facilities <the
  14-22  system>.  The term of an operating contract under this subsection
  14-23  may not exceed 20 years.
  14-24        (o) <(m)>  A district may contract with any county or other
  14-25  political subdivision of the state for the district to provide rail
  14-26  transportation services to any area outside the boundaries of the
  14-27  district on such terms and conditions as may be agreed to by the
   15-1  parties.
   15-2        (p)  Before beginning the operation of rail facilities the
   15-3  board of a district shall adopt an annual operating budget
   15-4  specifying the anticipated revenues and expenses of the district
   15-5  for the remainder of the fiscal year, and the district shall adopt
   15-6  an operating budget for each succeeding fiscal year.  The fiscal
   15-7  year of the district ends September 30 unless changed by the board
   15-8  not more than once in any three-year period.  The board shall hold
   15-9  a public hearing before adopting each budget except the initial
  15-10  budget.  Notice of each hearing must be published at least seven
  15-11  days before the date of the hearing in a newspaper of general
  15-12  circulation in the district.  A budget may be amended at any time
  15-13  if notice of the proposed amendment is given in the notice of
  15-14  meeting.  An expenditure that is not budgeted may not be made.
  15-15        (q)  The board of a district shall by resolution name one or
  15-16  more banks for the deposit of district funds.  District funds are
  15-17  public funds and may be invested in securities permitted by the
  15-18  Public Funds Investment Act of 1987 (Article 842a-2, Vernon's Texas
  15-19  Civil Statutes).  To the extent funds of the district are not
  15-20  insured by the Federal Deposit Insurance Corporation or its
  15-21  successor, they shall be collateralized in the manner provided for
  15-22  county funds.
  15-23        Sec. 6.  Bonds and Notes.  (a)  A district may issue revenue
  15-24  bonds and notes from time to time and in such amounts as its board
  15-25  considers necessary or appropriate for the acquisition, purchase,
  15-26  construction, reconstruction, repair, equipping, improvement, or
  15-27  extension of its rail facilities <system>.  All bonds and notes are
   16-1  fully negotiable and may be made redeemable before maturity, at the
   16-2  option of the issuing district, at such price or prices and under
   16-3  such terms and conditions as may be fixed by the issuing district
   16-4  in the resolution authorizing the bonds or notes, and may be sold
   16-5  at public or private sale, as determined by the board.
   16-6        (b)  Before delivery, all bonds and notes authorized to be
   16-7  issued, except notes issued to an agency of the federal or state
   16-8  government, and the records relating to their issuance shall be
   16-9  submitted to the attorney general for examination.  If the attorney
  16-10  general finds that they have been issued in accordance with the
  16-11  constitution and this Act, and that they will be binding
  16-12  obligations of the district issuing them, the attorney general
  16-13  shall approve them, and they shall be registered by the state
  16-14  comptroller of public accounts.   After approval, registration, and
  16-15  sale and delivery of the bonds to the purchaser, they are
  16-16  incontestable.
  16-17        (c)  In order to secure the payment of the bonds or notes,
  16-18  the district may encumber and pledge all or any part of the
  16-19  revenues of its rail facilities <system>, may mortgage and encumber
  16-20  all or any part of the properties of the rail facilities <system>,
  16-21  and everything pertaining to them acquired or to be acquired, and
  16-22  may prescribe the terms and provisions of the bonds and notes in
  16-23  any manner not inconsistent with this Act.  If not prohibited by
  16-24  the resolution or indenture relating to outstanding bonds or notes,
  16-25  any district may encumber separately any item or items of real
  16-26  estate or personalty.
  16-27        (d)  All bonds and notes are legal and authorized investments
   17-1  for banks, trust companies, savings and loan associations, and
   17-2  insurance companies.  The bonds and notes are eligible to secure
   17-3  the deposit of public funds of the state, cities, towns, villages,
   17-4  counties, school districts, or other political corporations or
   17-5  subdivisions of the state.  The bonds and notes are lawful and
   17-6  sufficient security for the deposits to the extent of the bonds'
   17-7  principal amount or market value, whichever is less<, when
   17-8  accompanied by all unmatured coupons appurtenant to them>.
   17-9        (e)  Bonds payable solely from revenues may be issued by
  17-10  resolution of the board.
  17-11        Sec. 6A.  ALTERNATIVE FINANCING.  (a)  A district may use the
  17-12  procedures provided by Chapter 271, Local Government Code, to
  17-13  finance rail facilities of the district, except to the extent of
  17-14  conflict with this Act and except that the district may not levy or
  17-15  collect ad valorem taxes.
  17-16        (b)  A district may issue nonnegotiable purchase money notes,
  17-17  payable in installments and secured by the property being acquired
  17-18  or constructed, to acquire or construct rail facilities.  A
  17-19  district may also secure the obligation of the notes by a pledge or
  17-20  undertaking to issue bonds or bond anticipation notes.  A district
  17-21  may covenant with the purchaser of bond anticipation notes that the
  17-22  proceeds of one or more particular series of bonds will be used for
  17-23  the ultimate payment of the purchase money notes or  bond
  17-24  anticipation notes.
  17-25        SECTION 2.  All orders by the commissioners courts of
  17-26  eligible counties, as defined by Chapter 623, Acts of the 67th
  17-27  Legislature, Regular Session, 1981 (Article 6550c, Vernon's Texas
   18-1  Civil Statutes), as amended by this  Act, that were adopted before
   18-2  the effective date of this Act and have not been repealed, that
   18-3  purported to create a rural rail transportation district under that
   18-4  Act, that named the counties to be included in the district, and
   18-5  that are not the subject of litigation as to their validity on the
   18-6  effective date of this Act are validated, ratified, and confirmed
   18-7  as if they were adopted in compliance with  all applicable law.
   18-8        SECTION 3.  The board of each rural rail transportation
   18-9  district that was created or re-created before the effective date
  18-10  of this Act or is validated by this Act shall, not later than the
  18-11  90th day after the effective date of this Act, file with the
  18-12  Railroad Commission of Texas a  certified copy of the orders
  18-13  creating or re-creating the district.
  18-14        SECTION 4.  The importance of this legislation and the
  18-15  crowded condition of the calendars in both houses create an
  18-16  emergency and an imperative public necessity that the
  18-17  constitutional rule requiring bills to be read on three several
  18-18  days in each house be suspended, and this rule is hereby suspended,
  18-19  and that this Act take effect and be in force from and after its
  18-20  passage, and it is so enacted.