1-1 By: Duncan S.B. No. 721 1-2 (In the Senate - Filed February 24, 1997; February 26, 1997, 1-3 read first time and referred to Committee on State Affairs; 1-4 March 18, 1997, reported adversely, with favorable Committee 1-5 Substitute by the following vote: Yeas 13, Nays 0; March 18, 1997, 1-6 sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 721 By: Carona 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to the issuance of certificates of obligation for the 1-11 payment of a municipality's contractual interests in certain 1-12 utilities. 1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-14 SECTION 1. Section 271.045, Local Government Code, is 1-15 amended by adding Subsections (c) and (d) to read as follows: 1-16 (c) The governing body of a municipality may issue 1-17 certificates of obligation to pay all or part of a municipality's 1-18 obligations incurred by contract for interests in and rights to 1-19 water or sewer treatment capacity in connection with a water supply 1-20 and transmission project or sewer treatment or collection project 1-21 to be constructed in whole or in part on behalf of the municipality 1-22 by another governmental entity or political subdivision pursuant to 1-23 a written agreement expressly authorized under Section 402.014 of 1-24 this code or Section 791.026, Government Code. 1-25 (d) In exercising its authority to issue certificates of 1-26 obligation for the purposes specified in Subsection (c), the 1-27 municipality must limit the principal amount of certificates to be 1-28 issued for the purpose of funding its contractual obligations to an 1-29 amount equal to (i) the aggregate of the contractual payments or 1-30 the total costs allocated or attributed, under generally accepted 1-31 accounting principles, to the capital costs of the project, as 1-32 opposed to any maintenance or operating costs to be paid under the 1-33 written agreement or (ii) the total cost of the project multiplied 1-34 by the percentage of the nameplate capacity of the project acquired 1-35 or conveyed by the written agreement to the municipality, whichever 1-36 limitation is applicable to the contractual interests or rights 1-37 being conveyed or identified in the written agreement. 1-38 SECTION 2. The importance of this legislation and the 1-39 crowded condition of the calendars in both houses create an 1-40 emergency and an imperative public necessity that the 1-41 constitutional rule requiring bills to be read on three several 1-42 days in each house be suspended, and this rule is hereby suspended, 1-43 and that this Act take effect and be in force from and after its 1-44 passage, and it is so enacted. 1-45 * * * * *