By Wolens                                             H.B. No. 3157
         76R5344 ESH-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the adoption of a nonsubstantive revision of statutes
 1-3     relating to public securities, including conforming amendments,
 1-4     repeals, and penalties.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  ADOPTION OF PUBLIC SECURITIES TITLE.  The
 1-7     Government Code is amended by adding Title 9 to read as follows:
 1-8                         TITLE 9.  PUBLIC SECURITIES
 1-9                       SUBTITLE A.  GENERAL PROVISIONS
1-10     CHAPTER 1201.  PUBLIC SECURITY PROCEDURES ACT
1-11     CHAPTER 1202.  EXAMINATION AND REGISTRATION OF PUBLIC
1-12                      SECURITIES
1-13     CHAPTER 1203.  REGISTRAR FOR PUBLIC SECURITY
1-14     CHAPTER 1204.  INTEREST RATE
1-15     CHAPTER 1205.  PUBLIC SECURITY DECLARATORY JUDGMENT ACTIONS
1-16     CHAPTER 1206.  REPLACEMENT FOR DAMAGED, DESTROYED, LOST,
1-17                      OR STOLEN PUBLIC SECURITIES
1-18     CHAPTER 1207.  REFUNDING BONDS
1-19                 (Chapters 1208-1230 reserved for expansion)
1-20              SUBTITLE B.  PROVISIONS APPLICABLE TO SECURITIES
1-21                         ISSUED BY STATE GOVERNMENT
1-22     CHAPTER 1231.  BOND REVIEW BOARD
1-23     CHAPTER 1232.  TEXAS PUBLIC FINANCE AUTHORITY
1-24     CHAPTER 1233.  COLLEGE OPPORTUNITY ACT
 2-1                 (Chapters 1234-1250 reserved for expansion)
 2-2           SUBTITLE C.  PROVISIONS APPLICABLE TO SECURITIES ISSUED
 2-3                  BY MORE THAN ONE TYPE OF LOCAL GOVERNMENT
 2-4     CHAPTER 1251.  BOND ELECTIONS 
 2-5     CHAPTER 1252.  REVOCATION OF AUTHORITY TO ISSUE BONDS 
 2-6     CHAPTER 1253.  BOND AND WARRANT LAW 
 2-7                 (Chapters 1254-1300 reserved for expansion)
 2-8             SUBTITLE D.  PROVISIONS  APPLICABLE TO  SECURITIES
 2-9                             ISSUED BY COUNTIES
2-10     CHAPTER 1301.  COUNTY BONDS
2-11     CHAPTER 1302.  DESTRUCTION OF COUNTY SECURITY 
2-12                 (Chapters 1303-1330 reserved for expansion)
2-13              SUBTITLE E.  PROVISIONS APPLICABLE TO SECURITIES
2-14                          ISSUED BY MUNICIPALITIES
2-15     CHAPTER 1331.  MUNICIPAL BONDS
2-16     CHAPTER 1332.  USE OF MUNICIPAL BOND PROCEEDS FOR OTHER
2-17                      PURPOSES 
2-18     CHAPTER 1333.  REVOCATION OF UNSOLD MUNICIPAL BONDS BY PETITION
2-19                 (Chapters 1334-1370 reserved for expansion)
2-20                 SUBTITLE F. SPECIFIC AUTHORITY FOR STATE OR
2-21                    LOCAL GOVERNMENT TO ISSUE SECURITIES
2-22     CHAPTER 1371.  OBLIGATIONS FOR CERTAIN PUBLIC IMPROVEMENTS
2-23     CHAPTER 1372.  PRIVATE ACTIVITY BONDS
2-24                 (Chapters 1373-1400 reserved for expansion)
 3-1                       SUBTITLE G.  SPECIFIC AUTHORITY
 3-2                  FOR STATE GOVERNMENT TO ISSUE SECURITIES
 3-3     CHAPTER 1401.  BONDS FOR CERTAIN CRIMINAL JUSTICE OR MENTAL
 3-4                      HEALTH AND MENTAL RETARDATION FACILITIES
 3-5     CHAPTER 1402.  PUBLIC SCHOOL FACILITIES FUNDING ACT
 3-6                 (Chapters 1403-1430 reserved for expansion)
 3-7              SUBTITLE H.  SPECIFIC AUTHORITY FOR MORE THAN ONE
 3-8                TYPE OF LOCAL GOVERNMENT TO ISSUE SECURITIES
 3-9     CHAPTER 1431.  ANTICIPATION NOTES
3-10     CHAPTER 1432.  BONDS FOR LOCAL GOVERNMENT SPORTS CENTERS
3-11     CHAPTER 1433.  BONDS FOR DEVELOPMENT OF EMPLOYMENT, INDUSTRIAL,
3-12                      AND HEALTH RESOURCES
3-13     CHAPTER 1434.  COUNTY AND MUNICIPAL HIGHER EDUCATION
3-14                      IMPROVEMENT BONDS
3-15     CHAPTER 1435.  BONDS FOR PARKS AND FAIRGROUND FACILITIES IN
3-16                      CERTAIN MUNICIPALITIES AND COUNTIES
3-17                 (Chapters 1436-1470 reserved for expansion)
3-18                SUBTITLE I.  SPECIFIC AUTHORITY FOR COUNTIES
3-19                             TO ISSUE SECURITIES
3-20     CHAPTER 1471.  BONDS FOR COUNTY ROADS
3-21     CHAPTER 1472.  REFUNDING OF COUNTY BONDS FOR CAUSEWAYS
3-22     CHAPTER 1473.  OBLIGATIONS FOR COUNTY BUILDINGS
3-23     CHAPTER 1474.  BONDS FOR COUNTY WATER IMPROVEMENTS
3-24     CHAPTER 1475.  COUNTY BONDS AND WARRANTS FOR NAVIGATION PURPOSES
3-25     CHAPTER 1476.  CERTIFICATES OF INDEBTEDNESS IN COUNTIES WITH
3-26                      POPULATION OF MORE THAN 1.5 MILLION
3-27     CHAPTER 1477.  OBLIGATIONS FOR OTHER COUNTY PURPOSES
 4-1                 (Chapters 1478-1500 reserved for expansion)
 4-2             SUBTITLE J.  SPECIFIC AUTHORITY FOR MUNICIPALITIES
 4-3                             TO ISSUE SECURITIES
 4-4     CHAPTER 1501.  OBLIGATIONS FOR MUNICIPAL UTILITIES
 4-5     CHAPTER 1502.  OBLIGATIONS FOR MUNICIPAL UTILITIES, PARKS, OR
 4-6                      POOLS 
 4-7     CHAPTER 1503.  OBLIGATIONS FOR MUNICIPAL AIRPORTS
 4-8     CHAPTER 1504.  OBLIGATIONS FOR MUNICIPAL BUILDINGS
 4-9     CHAPTER 1505.  OBLIGATIONS FOR COASTAL MUNICIPALITIES FOR
4-10                      COASTAL MATTERS
4-11     CHAPTER 1506.  BONDS FOR MUNICIPAL PARKING AND TRANSPORTATION
4-12                      FACILITIES
4-13     CHAPTER 1507.  OBLIGATIONS RELATING TO MUNICIPAL DEBT AND
4-14                      EXPENSES
4-15     CHAPTER 1508.  OBLIGATIONS FOR MUNICIPAL PARKS, RECREATIONAL
4-16                      FACILITIES, AND AIRPORTS
4-17     CHAPTER 1509.  OBLIGATIONS FOR OTHER MUNICIPAL PURPOSES
4-18                         TITLE 9.  PUBLIC SECURITIES
4-19                       SUBTITLE A. GENERAL PROVISIONS
4-20                CHAPTER 1201.  PUBLIC SECURITY PROCEDURES ACT
4-21                      SUBCHAPTER A.  GENERAL PROVISIONS
4-22     Sec. 1201.001.  SHORT TITLE
4-23     Sec. 1201.002.  DEFINITIONS
4-24     Sec. 1201.003.  APPLICABILITY
4-25     Sec. 1201.004.  CONSTRUCTION
4-26     Sec. 1201.005.  CONTENTS OF PUBLIC SECURITY AUTHORIZATION
4-27             (Sections 1201.006-1201.020 reserved for expansion)
 5-1           SUBCHAPTER B.  ISSUANCE AND APPROVAL OF PUBLIC SECURITY
 5-2     Sec. 1201.021.  CHARACTERISTICS OF PUBLIC SECURITY
 5-3     Sec. 1201.022.  TERMS OF ISSUANCE
 5-4     Sec. 1201.023.  UNCERTIFICATED BOOK-ENTRY ISSUANCE
 5-5     Sec. 1201.024.  FORM OF PUBLIC SECURITY
 5-6     Sec. 1201.025.  RATE OF INTEREST
 5-7     Sec. 1201.026.  EXECUTION OF PUBLIC SECURITY OR INTEREST
 5-8                       COUPON
 5-9     Sec. 1201.027.  AUTHORITY OF POLITICAL SUBDIVISION OR
5-10                       MUNICIPAL CORPORATION TO CONTRACT FOR
5-11                       SERVICES
5-12             (Sections 1201.028-1201.040 reserved for expansion)
5-13             SUBCHAPTER C.  FINANCIAL ASPECTS OF PUBLIC SECURITY
5-14     Sec. 1201.041.  PUBLIC SECURITY AS NEGOTIABLE INSTRUMENT AND
5-15                       INVESTMENT SECURITY
5-16     Sec. 1201.042.  USE OF CERTAIN PROCEEDS
5-17     Sec. 1201.043.  USE OF INVESTMENT INCOME
5-18     Sec. 1201.044.  PLEDGE OR LIEN ON RESOURCES, ASSETS, OR FUND
5-19                       OF ISSUER
5-20             (Sections 1201.045-1201.060 reserved for expansion)
5-21          SUBCHAPTER D.  CHANGE OR CONVERSION OF PUBLIC SECURITIES
5-22     Sec. 1201.061.  CONVERSION, RECONVERSION, TRANSFER, OR EXCHANGE OF
5-23                       PUBLIC SECURITY
5-24     Sec. 1201.062.  CHANGE OR CONVERSION OF PUBLIC SECURITY
5-25     Sec. 1201.063.  EXECUTION AND EXCHANGE OF NEW PUBLIC
5-26                       SECURITY
 6-1     Sec. 1201.064.  SUBMISSION OF NEW PUBLIC SECURITY TO ATTORNEY
 6-2                       GENERAL
 6-3     Sec. 1201.065.  APPROVAL OF NEW PUBLIC SECURITY BY ATTORNEY
 6-4                       GENERAL
 6-5     Sec. 1201.066.  REGISTRATION OF NEW PUBLIC SECURITY BY
 6-6                       COMPTROLLER
 6-7     Sec. 1201.067.  EXCEPTION TO APPROVAL REQUIREMENT
 6-8                CHAPTER 1201.  PUBLIC SECURITY PROCEDURES ACT
 6-9                      SUBCHAPTER A.  GENERAL PROVISIONS
6-10           Sec. 1201.001.  SHORT TITLE.  This chapter may be cited as
6-11     the Public Security Procedures Act.  (V.A.C.S. Art. 717k-6, Sec.
6-12     1(c).)
6-13           Sec. 1201.002.  DEFINITIONS.  In this chapter:
6-14                 (1)  "Issuer" means:
6-15                       (A)  an agency, authority, board, body politic,
6-16     department, district, instrumentality, municipal corporation,
6-17     political subdivision, public corporation, or subdivision of this
6-18     state; or
6-19                       (B)  a nonprofit corporation acting for or on
6-20     behalf of an entity described by Paragraph (A).
6-21                 (2)  "Public security" means an instrument, including a
6-22     bond, certificate, note, or other type of obligation authorized to
6-23     be issued by an issuer under a statute, a municipal home-rule
6-24     charter, or the constitution of this state.
6-25                 (3)  "Public security authorization" means a
6-26     resolution, order, or ordinance that is approved or adopted, or any
6-27     other action taken in a proceeding, by the governing body of an
 7-1     issuer in authorizing the issuance of a public security.  (V.A.C.S.
 7-2     Art. 717k-6, Secs. 1(a), (b); Art. 717k-9, Sec. 1; New.)
 7-3           Sec. 1201.003.  APPLICABILITY.  This chapter applies to:
 7-4                 (1)  an original public security;
 7-5                 (2)  a refunding public security;
 7-6                 (3)  an exchanged or converted public security; or
 7-7                 (4)  any combination of those securities.  (V.A.C.S.
 7-8     Art. 717k-6, Sec. 2 (part).)
 7-9           Sec. 1201.004.  CONSTRUCTION.  This chapter shall be
7-10     liberally construed to achieve the legislative intent and purposes
7-11     of this chapter.  A power granted by this chapter shall be broadly
7-12     interpreted to achieve that intent and those purposes.  (V.A.C.S.
7-13     Art. 717k-6, Sec. 10.)
7-14           Sec. 1201.005.  CONTENTS OF PUBLIC SECURITY AUTHORIZATION.
7-15     To the extent applicable to an authorized public security, the
7-16     public security authorization for the public security must contain
7-17     each item or other matter authorized or described by Subchapter B
7-18     and Sections 1201.061 and 1201.063.  (V.A.C.S. Art. 715b, Secs.
7-19     3(a) (part), (b) (part); Art. 717k-6, Secs. 3 (part); 4 (part);
7-20     5(a) (part), (b) (part); 6(a) (part), (b) (part).)
7-21             (Sections 1201.006-1201.020 reserved for expansion)
7-22           SUBCHAPTER B.  ISSUANCE AND APPROVAL OF PUBLIC SECURITY
7-23           Sec. 1201.021.  CHARACTERISTICS OF PUBLIC SECURITY.  A public
7-24     security may:
7-25                 (1)  be issued in any denomination;
7-26                 (2)  bear no interest or bear interest at one or more
7-27     specified rates;
 8-1                 (3)  be issued with one or more interest coupons or
 8-2     without a coupon;
 8-3                 (4)  be issued as redeemable before maturity at one or
 8-4     more specified times; and
 8-5                 (5)  be payable:
 8-6                       (A)  at one or more times;
 8-7                       (B)  in installments or a specified amount or
 8-8     amounts;
 8-9                       (C)  at a specified place or places;
8-10                       (D)  under specified terms; and
8-11                       (E)  in a specified form or manner.  (V.A.C.S.
8-12     Art. 717k-6, Sec. 3 (part).)
8-13           Sec. 1201.022.  TERMS OF ISSUANCE.  (a)  A public security
8-14     may be:
8-15                 (1)  issued singly or in a series;
8-16                 (2)  made payable in a specified amount or amounts or
8-17     installments to:
8-18                       (A)  the bearer;
8-19                       (B)  a registered or named person;
8-20                       (C)  the order of a registered or named person;
8-21     or
8-22                       (D)  a successor or assign of a registered or
8-23     named person; and
8-24                 (3)  issued with other specified characteristics, on
8-25     additional specified terms, or in a specified manner.
8-26           (b)  The governing body of a county or municipality that
8-27     issues bonds that are to be paid from ad valorem taxes may provide
 9-1     that the bonds are to mature serially over a specified number of
 9-2     years, not to exceed 40.  (V.A.C.S. Art. 706; Art. 717k-6, Sec.
 9-3     5(a) (part).)
 9-4           Sec. 1201.023.  UNCERTIFICATED BOOK-ENTRY ISSUANCE.  (a)  The
 9-5     governing body of an issuer may provide for a book-entry record of
 9-6     ownership of a public security issued by the issuer.  A public
 9-7     security may be issued in uncertificated book-entry form.
 9-8           (b)  The record of ownership of a public security issued in
 9-9     uncertificated book-entry form may be kept by the issuer or an
9-10     agent of the issuer.  (V.A.C.S. Art. 717k-6, Sec. 5(b) (part).)
9-11           Sec. 1201.024.  FORM OF PUBLIC SECURITY.  (a)  A public
9-12     security may be:
9-13                 (1)  issued in a specified form or forms;
9-14                 (2)  issued with one or more interest coupons;
9-15                 (3)  registrable as to principal and interest or only
9-16     as to principal; and
9-17                 (4)  changed in form in a specific manner.
9-18           (b)  A public security issued with one or more interest
9-19     coupons may have:
9-20                 (1)  a specified form of a coupon; and
9-21                 (2)  a form of a coupon that may be changed in a
9-22     specified manner.
9-23           (c)  An issuer may provide that a public security:
9-24                 (1)  has a coupon and is not registrable;
9-25                 (2)  has a coupon and is registrable only as to
9-26     principal;
9-27                 (3)  is fully registrable; or
 10-1                (4)  initially has a coupon but may become a fully
 10-2    registrable security under Section 1203.041.
 10-3          (d)  An issuer may provide that public securities of the same
 10-4    issue or series are:
 10-5                (1)  of one or more types described by Subsection (c);
 10-6    and
 10-7                (2)  exchangeable in whole or in part for one or more
 10-8    of those types. (V.A.C.S. Art. 715b, Secs. 3(a) (part), (b) (part);
 10-9    Art. 717k-6, Sec. 4 (part).)
10-10          Sec. 1201.025.  RATE OF INTEREST.  (a)  An interest rate on a
10-11    public security that accrues interest may be fixed, variable,
10-12    floating, adjustable, or computed by another method.
10-13          (b)  If an interest rate is not specified by the governing
10-14    body of an issuer issuing a public security, the interest rate is
10-15    determined by a formula or contractual arrangement for the periodic
10-16    determination of the rate.  (V.A.C.S. Art. 717k-6, Sec. 3 (part).)
10-17          Sec. 1201.026.  EXECUTION OF PUBLIC SECURITY OR INTEREST
10-18    COUPON.  (a)  A public security or an interest coupon may be
10-19    executed, with or without a seal, with a manual or facsimile
10-20    signature.
10-21          (b)  The signature on a public security or on an interest
10-22    coupon of a person who is no longer an officer when the security or
10-23    coupon is delivered to a purchaser is valid and sufficient for all
10-24    purposes.
10-25          (c)  A person's successor in office may complete the
10-26    execution, authentication, or delivery of the public security or
10-27    interest coupon.  (V.A.C.S.  Art. 717k-6, Sec. 3 (part).)
 11-1          Sec. 1201.027.  AUTHORITY OF POLITICAL SUBDIVISION OR
 11-2    MUNICIPAL CORPORATION TO CONTRACT FOR SERVICES.  (a)  The governing
 11-3    body of a home-rule municipality or other political subdivision or
 11-4    municipal corporation of this state or of an instrumentality of
 11-5    such an entity has exclusive authority to select and contract with
 11-6    a person to provide a service in connection with a public security
 11-7    being issued, including legal counsel, an underwriter, or a
 11-8    financial advisor.
 11-9          (b)  To the extent of a conflict between this section and
11-10    another law or a municipal charter, this section controls.
11-11    (V.A.C.S. Art. 717k-6, Sec. 3A (part); Art. 717k-8, Sec. 3.002(g).)
11-12            (Sections 1201.028-1201.040 reserved for expansion)
11-13            SUBCHAPTER C.  FINANCIAL ASPECTS OF PUBLIC SECURITY
11-14          Sec. 1201.041.  PUBLIC SECURITY AS NEGOTIABLE INSTRUMENT AND
11-15    INVESTMENT SECURITY.  A public security is:
11-16                (1)  a negotiable instrument;
11-17                (2)  an investment security to which Chapter 8,
11-18    Business & Commerce Code, applies; and
11-19                (3)  a legal and authorized investment for:
11-20                      (A)  an insurance company;
11-21                      (B)  a fiduciary or trustee; or
11-22                      (C)  a sinking fund of a municipality or other
11-23    political subdivision or public agency of this state.  (V.A.C.S.
11-24    Art. 717k-6, Sec. 9 (part).)
11-25          Sec. 1201.042.  USE OF CERTAIN PROCEEDS.  (a) If an issuer is
11-26    authorized by law to secure and pay any portion of a public
11-27    security with revenue derived from the ownership or operation of a
 12-1    project or facility, the issuer may use the proceeds of the public
 12-2    security to:
 12-3                (1)  pay interest on the public security while the
 12-4    project or facility is being acquired or constructed and for the
 12-5    year after it is acquired or constructed;
 12-6                (2)  operate and maintain the project or facility
 12-7    during the estimated period of acquisition or construction of the
 12-8    project or facility and for one year after it is acquired or
 12-9    constructed;
12-10                (3)  finance other funds relating to the public
12-11    security, including debt service reserve and contingency; and
12-12                (4)  pay the cost or expense of the issuance of the
12-13    public security.
12-14          (b)  To the extent and in the manner provided in a public
12-15    security authorization, until the proceeds from a public security
12-16    described by Subsection (a) are needed the proceeds may be:
12-17                (1)  placed on time deposit; or
12-18                (2)  invested in an obligation authorized for the
12-19    investment of money of the issuer.
12-20          (c)  Proceeds from the sale of a public security issued to
12-21    finance the acquisition, construction, equipping, or furnishing of
12-22    a project or facility may be used to reimburse the issuer for a
12-23    cost that is:
12-24                (1)  attributable to the project or facility; and
12-25                (2)  paid or incurred before the date of the public
12-26    security's issuance.  (V.A.C.S. Art. 717k-6, Sec. 7.)
12-27          Sec. 1201.043.  USE OF INVESTMENT INCOME.  An issuer
 13-1    authorized to invest proceeds from the sale of a public security,
 13-2    including by placing the proceeds on time deposit, may use money
 13-3    earned from the investment for the purpose for which the public
 13-4    security was issued.  (V.A.C.S. Art. 717k-9, Sec. 2.)
 13-5          Sec. 1201.044.  PLEDGE OR LIEN ON RESOURCES, ASSETS, OR FUND
 13-6    OF ISSUER.  (a)  A pledge or lien provided for in a public security
 13-7    authorization on a resource of an issuer, including revenue or
 13-8    income, on an asset of an issuer, or on a fund maintained by an
 13-9    issuer:
13-10                (1)  is valid without further action by the issuer
13-11    according to its terms and without being filed or recorded, except
13-12    in the records of the issuer;
13-13                (2)  is effective from the time of payment for and
13-14    delivery of the public security until the public security is paid
13-15    or payment of the public security has been provided for; and
13-16                (3)  is effective as to an item on hand or later
13-17    received, and the item is subject to the lien or pledge without
13-18    physical delivery of the item or other act.
13-19          (b)  This section does not exempt an issuer from a duty to:
13-20                (1)  record a lien on real property; or
13-21                (2)  submit a public security to the attorney general
13-22    for approval and registration by the comptroller.  (V.A.C.S.
13-23    Art. 717k-6, Sec. 12.)
13-24            (Sections 1201.045-1201.060 reserved for expansion)
13-25         SUBCHAPTER D.  CHANGE OR CONVERSION OF PUBLIC SECURITIES
13-26          Sec. 1201.061.  CONVERSION, RECONVERSION, TRANSFER, OR
13-27    EXCHANGE OF PUBLIC SECURITY.  (a) The governing body of an issuer
 14-1    may:
 14-2                (1)  provide and covenant for:
 14-3                      (A)  conversion of one form of a public security
 14-4    or an interest coupon to another form or forms; and
 14-5                      (B)  reconversion of the public security or
 14-6    interest coupon to another form or forms; and
 14-7                (2)  provide procedures for transferring or exchanging
 14-8    a public security for a previously issued public security.
 14-9          (b)  A public security or an interest coupon may be
14-10    converted, on request of a bearer or owner, in an aggregate
14-11    principal amount equal to the unpaid principal amount of the public
14-12    security being converted, bearing interest at the same rate or
14-13    rates as the security being converted, to:
14-14                (1)  a public security with interest coupons, payable
14-15    to the bearer, and registrable as to principal and interest or only
14-16    as to principal;
14-17                (2)  a fully registered public security without
14-18    interest coupons; or
14-19                (3)  any other form, in any denomination.  (V.A.C.S.
14-20    Art. 717k-6, Secs.  5(a) (part), 6(b) (part).)
14-21          Sec. 1201.062.  CHANGE OR CONVERSION OF PUBLIC SECURITY.  If
14-22    a public security authorization provides a procedure for changing
14-23    or converting a public security, an additional resolution, order,
14-24    or ordinance is not required to change or convert the security.
14-25    (V.A.C.S. Art. 717k-6, Sec. 6(a) (part).)
14-26          Sec. 1201.063.  EXECUTION AND EXCHANGE OF NEW PUBLIC
14-27    SECURITY.  (a)  On request of the bearer or owner of a public
 15-1    security, if required or necessary, an appropriate officer of the
 15-2    issuer shall execute and exchange an appropriate new public
 15-3    security for the changed or converted public security.
 15-4          (b)  If a public security that is changed or converted has
 15-5    interest coupons, appropriate new coupons shall also be executed
 15-6    and exchanged.  (V.A.C.S.  Art. 717k-6, Sec. 6(a) (part).)
 15-7          Sec. 1201.064.  SUBMISSION OF NEW PUBLIC SECURITY TO ATTORNEY
 15-8    GENERAL.  Except as provided by Section 1201.067, an issuer that
 15-9    changes or converts a public security that has been registered by
15-10    the comptroller shall submit the new public security to the
15-11    attorney general for approval.  (V.A.C.S. Art. 717k-6, Sec. 6(a)
15-12    (part).)
15-13          Sec. 1201.065.  APPROVAL OF NEW PUBLIC SECURITY BY ATTORNEY
15-14    GENERAL.  The attorney general shall approve a new public security
15-15    if the attorney general finds that the new public security has been
15-16    printed or entered on the books of the registrar and executed and
15-17    issued as provided by law and a public security authorization
15-18    relating to the public security being changed or converted.
15-19    (V.A.C.S. Art. 717k-6, Sec. 6(a) (part).)
15-20          Sec. 1201.066.  REGISTRATION OF NEW PUBLIC SECURITY BY
15-21    COMPTROLLER.  (a)  The comptroller shall register and deliver a new
15-22    public security after:
15-23                (1)  approval of the new public security by the
15-24    attorney general; and
15-25                (2)  the surrender to and the cancellation by the
15-26    comptroller of each changed or converted public security.
15-27          (b)  On registration the new public security is valid and
 16-1    incontestable for all purposes.  (V.A.C.S. Art. 717k-6, Sec. 6(a)
 16-2    (part).)
 16-3          Sec. 1201.067.  EXCEPTION TO APPROVAL REQUIREMENT.  (a)  If
 16-4    the duty to convert or reconvert a public security or interest
 16-5    coupon or to transfer or exchange a public security is imposed on a
 16-6    corporate trustee under a trust agreement or indenture securing the
 16-7    public security or on a paying agent for the public security, the
 16-8    attorney general is not required to approve and the comptroller is
 16-9    not required to register:
16-10                (1)  the converted or reconverted public security or
16-11    interest coupon; or
16-12                (2)  the public security delivered on transfer or
16-13    exchange of the previously issued public security.
16-14          (b)  A converted or reconverted public security or interest
16-15    coupon, or a transferred or exchanged public security, is valid and
16-16    incontestable in the same manner and with the same effect as the
16-17    previously issued public security.  (V.A.C.S. Art. 717k-6, Sec.
16-18    6(b) (part).)
16-19     CHAPTER 1202.  EXAMINATION AND REGISTRATION OF PUBLIC SECURITIES
16-20    Sec. 1202.001.  DEFINITIONS
16-21    Sec. 1202.002.  AUTHORITY TO DEFINE TERMS
16-22    Sec. 1202.003.  REVIEW AND APPROVAL OF PUBLIC SECURITIES
16-23    Sec. 1202.004.  FEE FOR EXAMINATION OF PUBLIC SECURITY
16-24                      BY ATTORNEY GENERAL
16-25    Sec. 1202.005.  REGISTRATION
16-26    Sec. 1202.006.  VALIDITY AND INCONTESTABILITY
16-27    Sec. 1202.007.  EXEMPTIONS; CONSTRUCTION OF EXEMPTIONS
 17-1    Sec. 1202.008.  COLLECTION AND REPORT OF INFORMATION ON
 17-2                      PUBLIC SECURITIES OF POLITICAL SUBDIVISIONS
 17-3     CHAPTER 1202.  EXAMINATION AND REGISTRATION OF PUBLIC SECURITIES
 17-4          Sec. 1202.001.  DEFINITIONS.  In this chapter:
 17-5                (1)  "Issuance" means the initial delivery by an issuer
 17-6    of evidence of an obligation of a public security issued by the
 17-7    issuer to the initial purchaser in exchange for the purchase price
 17-8    of the public security.
 17-9                (2)  "Issuer" means:
17-10                      (A)  an agency, authority, board, body politic,
17-11    department, district, instrumentality, municipal corporation,
17-12    political subdivision, public corporation, or subdivision of this
17-13    state; or
17-14                      (B)  a nonprofit corporation acting for or on
17-15    behalf of an entity described by Paragraph (A).
17-16                (3)  "Public security" means an instrument, including a
17-17    bond, note, certificate of obligation, certificate of participation
17-18    or other instrument evidencing a proportionate interest in payments
17-19    due to be paid by an issuer, or other type of obligation that:
17-20                      (A)  is issued or incurred by an issuer under the
17-21    issuer's borrowing power, without regard to whether it is subject
17-22    to annual appropriation; and
17-23                      (B)  is represented by an instrument issued in
17-24    bearer or registered form or is not represented by an instrument
17-25    but the transfer of which is registered on books maintained for
17-26    that purpose by or on behalf of the issuer.
17-27                (4)  "Record of proceedings" means the record of an
 18-1    issuer's proceedings relating to the authorization of a public
 18-2    security.  (V.A.C.S. Art. 717k-8, Sec. 3.001(a); New.)
 18-3          Sec. 1202.002.  AUTHORITY TO DEFINE TERMS.  The attorney
 18-4    general may determine, by application of accepted legal principles,
 18-5    the meaning of a term used in this chapter, other than "issuance,"
 18-6    "issuer," or "public security," and by rule define that term.
 18-7    (V.A.C.S.  Art. 717k-8, Sec. 3.001(b).)
 18-8          Sec. 1202.003.  REVIEW AND APPROVAL OF PUBLIC SECURITIES.
 18-9    (a)  Before the issuance of a public security, the issuer shall
18-10    submit the public security and the record of proceedings to the
18-11    attorney general.
18-12          (b)  If the attorney general finds that the public security
18-13    has been authorized to be issued in conformity with law, the
18-14    attorney general shall:
18-15                (1)  approve the public security; and
18-16                (2)  deliver to the comptroller:
18-17                      (A)  a copy of the attorney general's legal
18-18    opinion stating that approval; and
18-19                      (B)  the record of proceedings.
18-20          (c)  Unless exempted by Section 1202.007, the issuance of a
18-21    public security except in compliance with this chapter is
18-22    prohibited.  (V.A.C.S. Art. 717k-8, Secs.  3.002(a), (b), 3.003(b)
18-23    (part), 3.004; Art. 4398.)
18-24          Sec. 1202.004.  FEE FOR EXAMINATION OF PUBLIC SECURITY BY
18-25    ATTORNEY GENERAL.  (a)  Except as provided by this section, when an
18-26    issuer submits a public security to the attorney general for
18-27    examination and approval as provided by law, the issuer shall pay a
 19-1    nonrefundable examination fee to the attorney general, in an amount
 19-2    computed according to the principal amount of the public security,
 19-3    as follows:
 19-4                Principal Amount                                    Fee
 19-5          not more than $500,000                                   $500
 19-6          more than $500,000 but not more than $5 million          $750
 19-7          more than $5 million but not more than $20 million     $1,000
 19-8          more than $20 million                                  $1,250
 19-9          (b)  If a nonprofit corporation or governmental entity
19-10    issuing the public security for the benefit of nongovernmental
19-11    entities submits the public security to the attorney general as
19-12    required by law, the fee is $1,250.
19-13          (c)  If the issuer is issuing multiple series of a single
19-14    public security, the issuer shall pay the fee prescribed by
19-15    Subsection (a) or (b) for each series, not to exceed $2,500 for one
19-16    issue in which all series are issued simultaneously.  (V.A.C.S.
19-17    Art. 717k-6, Secs. 6A(a), (b), (c), (d) (part).)
19-18          Sec. 1202.005.  REGISTRATION.  On receipt of documents
19-19    required by Section 1202.003(b)(2) from the attorney general, the
19-20    comptroller shall register:
19-21                (1)  the public security; and
19-22                (2)  the record of proceedings.  (V.A.C.S. Art. 710;
19-23    Art. 711 (part); Art. 717k-8, Sec. 3.002(c).)
19-24          Sec. 1202.006.  VALIDITY AND INCONTESTABILITY.  (a)  A public
19-25    security and any contract the proceeds of which are pledged to the
19-26    payment of the public security are valid and incontestable in a
19-27    court or other forum and are binding obligations for all purposes
 20-1    according to their terms:
 20-2                (1)  after the public security is approved by the
 20-3    attorney general and registered by the comptroller; and
 20-4                (2)  on issuance of the public security.
 20-5          (b)  In any action brought to enforce the collection of
 20-6    county or municipal bonds that are payable from ad valorem taxes
 20-7    and that have been approved by the attorney general and registered
 20-8    by the comptroller, the certificate of the attorney general shall
 20-9    be admitted as evidence of the validity of the bonds and the
20-10    interest coupons pertaining to the bonds.  (V.A.C.S. Art. 715
20-11    (part); Art. 717k-6, Sec. 2 (part); Art. 717k-8, Sec.  3.002(d).)
20-12          Sec. 1202.007.  EXEMPTIONS; CONSTRUCTION OF EXEMPTIONS.
20-13    (a)  The following are exempt from the approval and registration
20-14    requirements of this chapter:
20-15                (1)  a public security that is:
20-16                      (A)  not subject to mandatory renewal or renewal
20-17    at the option of any person, including the issuer, a holder, or a
20-18    bearer; and
20-19                      (B)  payable only out of:
20-20                            (i)  current revenues or taxes collected in
20-21    the year the public security is issued; or
20-22                            (ii)  the proceeds of other public
20-23    securities;
20-24                (2)  a certificate in evidence of benefit assessments;
20-25                (3)  a certificate of obligation, including a claim or
20-26    account that represents an undivided interest in a certificate of
20-27    obligation, that under Subchapter C, Chapter 271, Local Government
 21-1    Code, an issuer is authorized to deliver to a contractor;
 21-2                (4)  a time warrant issued under Chapter 252 or 262,
 21-3    Local Government Code;
 21-4                (5)  a public security authorized by Chapter 1371;
 21-5                (6)  a lease, lease-purchase, or installment sale
 21-6    obligation, except as provided by Subsection (b); and
 21-7                (7)  a public security that by rule the attorney
 21-8    general exempts because it is not practical to require approval
 21-9    before the public security's issuance.
21-10          (b)  A municipality with a population of less than 50,000 may
21-11    not for any purpose issue or have issued on its behalf an
21-12    installment sale obligation or lease-purchase obligation with a
21-13    principal amount of $1 million or more without complying with this
21-14    chapter, regardless of whether the obligation:
21-15                (1)  is issued individually or in a series of related
21-16    transactions; or
21-17                (2)  is issued without recourse to the municipality.
21-18          (c)  The exemptions provided by Subsection (a) shall be
21-19    narrowly construed.
21-20          (d)  An issuer that issues a public security that is exempt
21-21    under Subsection (a) may submit the public security to the attorney
21-22    general as provided by this chapter.  (V.A.C.S. Art. 717k-8, Secs.
21-23    3.003(a), (b) (part), (c); Sec.  2256.056, Gov. Code.)
21-24          Sec. 1202.008.  COLLECTION AND REPORT OF INFORMATION ON
21-25    PUBLIC SECURITIES OF POLITICAL SUBDIVISIONS.  (a)  In reviewing
21-26    public securities under this chapter, the attorney general may
21-27    collect, in the form required by the Bond Review Board, information
 22-1    on public securities issued by a municipal corporation or political
 22-2    subdivision of this state.
 22-3          (b)  The information must include:
 22-4                (1)  the terms of the public securities;
 22-5                (2)  the debt service payable on the public securities;
 22-6    and
 22-7                (3)  other information required by the Bond Review
 22-8    Board.
 22-9          (c)  The attorney general shall send the information to the
22-10    Bond Review Board for inclusion in the board's report of debt
22-11    statistics under Section 1231.062.  (V.A.C.S. Art. 717k-8, Sec.
22-12    3.002(h).)
22-13               CHAPTER 1203.  REGISTRAR FOR PUBLIC SECURITY
22-14                     SUBCHAPTER A.  GENERAL PROVISIONS
22-15    Sec. 1203.001.  DEFINITIONS
22-16    Sec. 1203.002.  EFFECT ON UNIFORM COMMERCIAL CODE
22-17    Sec. 1203.003.  CONFLICT WITH MUNICIPAL CHARTER
22-18            (Sections 1203.004-1203.020 reserved for expansion)
22-19              SUBCHAPTER B.  REGISTRATION OF PUBLIC SECURITY
22-20    Sec. 1203.021.  REGISTRAR FOR PUBLIC SECURITY; DESIGNATION IN
22-21                      PROCEEDINGS
22-22    Sec. 1203.022.  REGISTRATION OF PUBLIC SECURITY; CONFLICT WITH
22-23                      PUBLIC SECURITY AUTHORIZATION
22-24    Sec. 1203.023.  MAINTENANCE OF REGISTRAR RECORDS BY TRUST COMPANY
22-25                      OR COMMERCIAL BANK
22-26    Sec. 1203.024.  CHANGE OF NAME OR ADDRESS OF REGISTERED OWNER
22-27    Sec. 1203.025.  COST AND EXPENSES FOR REGISTRATION OR EXCHANGE OF
 23-1                      PUBLIC SECURITY
 23-2    Sec. 1203.026.  COMPTROLLER'S RULES AND FEE SCHEDULE
 23-3            (Sections 1203.027-1203.040 reserved for expansion)
 23-4         SUBCHAPTER C.  CONVERSION OR EXCHANGE OF PUBLIC SECURITY
 23-5    Sec. 1203.041.  CONVERSION OF PUBLIC SECURITY
 23-6    Sec. 1203.042.  APPROVAL AND REGISTRATION OF CONVERTED OR
 23-7                      EXCHANGED PUBLIC SECURITY
 23-8               CHAPTER 1203.  REGISTRAR FOR PUBLIC SECURITY
 23-9                     SUBCHAPTER A.  GENERAL PROVISIONS
23-10          Sec. 1203.001.  DEFINITIONS.  In this chapter:
23-11                (1)  "Fully registrable," with respect to a public
23-12    security, means that:
23-13                      (A)  the principal of and interest on the public
23-14    security are payable only to the registered owner of the public
23-15    security;
23-16                      (B)  the principal of the public security is
23-17    payable on presentation of the public security at the place of
23-18    payment; and
23-19                      (C)  the interest on the public security is
23-20    payable to the registered owner of the public security at the most
23-21    recent address of that owner as shown on the books of the
23-22    registrar.
23-23                (2)  "Issuer" means this state or a department, board,
23-24    authority, agency, district, municipal corporation, political
23-25    subdivision, instrumentality, or other political corporation of
23-26    this state that is authorized to issue public securities.
23-27                (3)  "Public security" means a bond, note, certificate
 24-1    of obligation, certificate of indebtedness, or other obligation for
 24-2    the payment of money lawfully issued by an issuer.
 24-3                (4)  "Public security authorization" means the
 24-4    resolution, order, or ordinance authorizing the issuance of a
 24-5    public security.
 24-6                (5)  "Registered owner" means:
 24-7                      (A)  the payee named in a fully registrable
 24-8    public security; or
 24-9                      (B)  the legal representative of or successor to
24-10    that payee.  (V.A.C.S. Art. 715b, Secs. 2(2), (3), (4), (5); New.)
24-11          Sec. 1203.002.  EFFECT ON UNIFORM COMMERCIAL CODE.  This
24-12    chapter does not:
24-13                (1)  qualify Title 1, Business & Commerce Code; or
24-14                (2)  limit the negotiability of a public security as
24-15    provided by that title.  (V.A.C.S. Art. 715b, Sec. 9(a) (part).)
24-16          Sec. 1203.003.  CONFLICT WITH MUNICIPAL CHARTER.  To the
24-17    extent of a conflict between this chapter and a municipal charter,
24-18    this chapter controls.  (V.A.C.S. Art. 715b, Sec. 9(b).)
24-19            (Sections 1203.004-1203.020 reserved for expansion)
24-20              SUBCHAPTER B.  REGISTRATION OF PUBLIC SECURITY
24-21          Sec. 1203.021.  REGISTRAR FOR PUBLIC SECURITY; DESIGNATION IN
24-22    PROCEEDINGS.  (a)  The public security authorization that
24-23    authorizes a fully registrable public security shall designate the
24-24    registrar for the security.
24-25          (b)  The registrar may be:
24-26                (1)  the comptroller;
24-27                (2)  a home-rule municipality with a population of more
 25-1    than 100,000, as to a security of the municipality;
 25-2                (3)  a county with a population of more than 100,000,
 25-3    as to a security of the county;
 25-4                (4)  a bank, including a commercial bank, at which the
 25-5    principal of the security is payable; or
 25-6                (5)  a trust company organized under a law of this
 25-7    state.
 25-8          (c)  Designation of a county as registrar for a public
 25-9    security issued by the county is effective only if the
25-10    commissioners court of the county makes the designation with regard
25-11    to an issuance of debt.
25-12          (d)  The county treasurer or the county officer who has the
25-13    powers and duties of the county treasurer shall perform the
25-14    registration duties for a county that is designated a registrar.
25-15    (V.A.C.S. Art. 715b, Secs. 2(6), (7); 4(a) (part); 4A.)
25-16          Sec. 1203.022.  REGISTRATION OF PUBLIC SECURITY; CONFLICT
25-17    WITH PUBLIC SECURITY AUTHORIZATION.  (a)  A fully registrable
25-18    public security may be registered as provided by the public
25-19    security authorization relating to the security.
25-20          (b)  To the extent of a conflict between this chapter and a
25-21    public security authorization that provides that a public security
25-22    is fully registrable, this chapter prevails.  (V.A.C.S. Art. 715b,
25-23    Sec. 4(a) (part).)
25-24          Sec. 1203.023.  MAINTENANCE OF REGISTRAR RECORDS BY TRUST
25-25    COMPANY OR COMMERCIAL BANK.  A trust company or a commercial bank
25-26    acting as a registrar under this chapter shall maintain the
25-27    registrar records in this state.  (V.A.C.S. Art. 715b, Sec.  4(b).)
 26-1          Sec. 1203.024.  CHANGE OF NAME OR ADDRESS OF REGISTERED
 26-2    OWNER.  If the comptroller is designated under this chapter as
 26-3    registrar of a public security and the comptroller's registration
 26-4    book reflects the change of name or address of a registered owner
 26-5    of the security, the comptroller shall notify each paying agent of
 26-6    the change.  (V.A.C.S. Art. 715b, Sec.  7(a).)
 26-7          Sec. 1203.025.  COST AND EXPENSES FOR REGISTRATION OR
 26-8    EXCHANGE OF PUBLIC SECURITY.  A public security authorization that
 26-9    authorizes the issuance of a public security that is, initially or
26-10    by exchange or conversion, fully registrable shall state the part
26-11    of the cost and expense of registering or exchanging the security
26-12    that the issuer will pay, including fees of the registrar named in
26-13    the public security authorization.  (V.A.C.S.  Art. 715b, Sec. 8
26-14    (part).)
26-15          Sec. 1203.026.  COMPTROLLER'S RULES AND FEE SCHEDULE.  The
26-16    comptroller shall:
26-17                (1)  adopt rules for the comptroller's performance of
26-18    services under this chapter; and
26-19                (2)  publish a schedule of fees for performing those
26-20    services.  (V.A.C.S. Art. 715b, Sec. 8 (part).)
26-21            (Sections 1203.027-1203.040 reserved for expansion)
26-22         SUBCHAPTER C.  CONVERSION OR EXCHANGE OF PUBLIC SECURITY
26-23          Sec. 1203.041.  CONVERSION OF PUBLIC SECURITY.  (a)  This
26-24    section applies to a public security only if the public security
26-25    authorization relating to the security:
26-26                (1)  provides for conversion of the security; and
26-27                (2)  names the comptroller as registrar.
 27-1          (b)  A public security that is issued with one or more
 27-2    coupons becomes fully registrable if:
 27-3                (1)  the security is presented to the comptroller; and
 27-4                (2)  the comptroller removes each coupon.
 27-5          (c)  A public security that is issued as a fully registrable
 27-6    security becomes a security with one or more coupons if:
 27-7                (1)  the security is presented to the comptroller; and
 27-8                (2)  the comptroller attaches an unmatured coupon or
 27-9    coupons to the security.
27-10          (d)  Attachment and removal of a coupon or coupons may occur
27-11    successively from time to time.  (V.A.C.S. Art. 715b, Sec. 5.)
27-12          Sec. 1203.042.  APPROVAL AND REGISTRATION OF CONVERTED OR
27-13    EXCHANGED PUBLIC SECURITY.  (a)  This section applies to a public
27-14    security only if:
27-15                (1)  the public security authorization relating to the
27-16    security provides that the security is fully registrable or is of
27-17    the type that has one or more coupons and that the security may be
27-18    exchanged; or
27-19                (2)  the security has been converted under Section
27-20    1203.041.
27-21          (b)  If the public security was initially approved by the
27-22    attorney general and registered by the comptroller, on exchange or
27-23    conversion of the security:
27-24                (1)  a public security that results from the exchange
27-25    or conversion is considered to have been approved by the attorney
27-26    general and registered by the comptroller;
27-27                (2)  the attorney general is not required to approve
 28-1    the resulting security; and
 28-2                (3)  the comptroller is not required to register the
 28-3    resulting security.
 28-4          (c)  If a public security is exchanged, the registrar shall
 28-5    have an appropriate inscription placed on the public security
 28-6    received in exchange verifying that the security received in
 28-7    exchange is in place of the security presented for exchange.  The
 28-8    inscription must be manually signed.  (V.A.C.S. Art. 715b, Sec. 6.)
 28-9                       CHAPTER 1204.  INTEREST RATE
28-10    Sec. 1204.001.  DEFINITIONS
28-11    Sec. 1204.002.  APPLICABILITY
28-12    Sec. 1204.003.  COMPUTATION OF PUBLIC SECURITY YEARS
28-13    Sec. 1204.004.  COMPUTATION OF NET INTEREST COST
28-14    Sec. 1204.005.  COMPUTATION OF NET EFFECTIVE INTEREST RATE
28-15    Sec. 1204.006.  MAXIMUM INTEREST RATE
28-16    Sec. 1204.007.  MAXIMUM INTEREST RATE FOR CERTAIN PUBLIC
28-17                      SECURITIES
28-18                       CHAPTER 1204.  INTEREST RATE
28-19          Sec. 1204.001.  DEFINITIONS.  In this chapter:
28-20                (1)  "Floating rate public security" means a public
28-21    security or a portion of a public security that bears a rate of
28-22    interest determined in accordance with a clearly stated formula,
28-23    computation, or method, under which the net interest cost of the
28-24    security or portion at any future date cannot be determined on the
28-25    date of delivery of the security or portion.
28-26                (2)  "Public agency" means:
28-27                      (A)  this state or a department, board, agency,
 29-1    district, municipal corporation, political subdivision, body
 29-2    politic and corporate, or instrumentality of this state; or
 29-3                      (B)  a nonprofit corporation or not-for-profit
 29-4    entity that is an instrumentality of or is acting on behalf of an
 29-5    entity described by Paragraph (A).
 29-6                (3)  "Public security" means a bond, note, or other
 29-7    obligation that a public agency is authorized to issue.  (V.A.C.S.
 29-8    Art. 717k-2, Secs. 1(a), (b) (part), (e).)
 29-9          Sec. 1204.002.  APPLICABILITY.  (a)  A provision of this
29-10    chapter concerning the sale price of a public security or the
29-11    maximum rate of interest that a public security may bear applies to
29-12    any public security without regard to a contrary provision in
29-13    another law or a charter.
29-14          (b)  A provision of this chapter concerning the sale price of
29-15    a public security does not apply to a public security whose maximum
29-16    rate of interest or maximum net effective interest rate is, at the
29-17    time the public security is issued, specifically set by the
29-18    constitution of this state.  (V.A.C.S. Art. 717k-2, Sec. 3.)
29-19          Sec. 1204.003.  COMPUTATION OF PUBLIC SECURITY YEARS.  (a)
29-20    Public security years are computed for each separate public
29-21    security that is part of an issue or series of public securities by
29-22    dividing the principal amount at par value of the public security
29-23    by 100 and multiplying the resulting quotient by:
29-24                (1)  the number of years from the date interest begins
29-25    to accrue on the public security to the date the security is
29-26    scheduled to mature; or
29-27                (2)  for a floating rate public security, the number of
 30-1    years from the date net interest cost begins to accrue on the
 30-2    public security to the earlier of:
 30-3                      (A)  the date the security is scheduled to
 30-4    mature; or
 30-5                      (B)  any date interest on the security is
 30-6    computed.
 30-7          (b)  If any portion of an issue or series of public
 30-8    securities is subject to a mandatory redemption before the
 30-9    scheduled maturity that at the time of delivery of the public
30-10    securities is scheduled to occur on a specific date or dates, the
30-11    public security years are computed as if the face amount of public
30-12    securities required to be redeemed on each earlier date were
30-13    scheduled to mature on that earlier date.  (V.A.C.S. Art. 717k-2,
30-14    Sec. 1(c) (part).)
30-15          Sec. 1204.004.  COMPUTATION OF NET INTEREST COST.  (a)  In
30-16    this section:
30-17                (1)  "Discount" means an amount equal to the principal
30-18    amount at par value of an issue or series of public securities plus
30-19    any accrued interest to the date of delivery minus the total sum of
30-20    money paid to the public agency.
30-21                (2)  "Premium" means an amount equal to the total
30-22    amount of money paid to the public agency for an issue or series of
30-23    public securities minus:
30-24                      (A)  the principal amount at par value of the
30-25    issue or series; and
30-26                      (B)  any accrued interest to the date of
30-27    delivery.
 31-1          (b)  The net interest cost of an issue or series of public
 31-2    securities is the total of all interest to become payable on the
 31-3    issue or series through the final scheduled maturity date of the
 31-4    issue or series, plus any discount or minus any premium included in
 31-5    the price paid for the issue or series.
 31-6          (c)  The net interest cost of an issue or series of floating
 31-7    rate public securities is the total of all interest to accrue from
 31-8    the date of delivery and become payable on the issue or series
 31-9    through any date net interest cost is computed on the issue or
31-10    series:
31-11                (1)  plus, in the case of a discount, the figure
31-12    obtained by multiplying the dollar amount of the discount by a
31-13    fraction, the numerator of which is the aggregate number of public
31-14    security years to the date of the net interest cost computation and
31-15    the denominator of which is the aggregate number of public security
31-16    years to the scheduled final maturity date of the floating rate
31-17    public securities; or
31-18                (2)  minus, in the case of a premium, the figure
31-19    obtained by multiplying the dollar amount of the premium by a
31-20    fraction, the numerator of which is the aggregate number of public
31-21    security years to the date of the net interest cost computation and
31-22    the denominator of which is the aggregate number of public security
31-23    years to the scheduled final maturity date of the floating rate
31-24    public securities.
31-25          (d)  If any portion of an issue or series of public
31-26    securities is subject to a mandatory redemption before the
31-27    scheduled maturity that at the time of delivery of the public
 32-1    securities is scheduled to occur on a specific date or dates:
 32-2                (1)  the net interest cost is computed as if the face
 32-3    amount of public securities required to be redeemed on each earlier
 32-4    date were scheduled to mature on that earlier date;
 32-5                (2)  the net interest cost includes any redemption
 32-6    premium required to be paid on any mandatory redemption date; and
 32-7                (3)  any other form of compensation, whether due on an
 32-8    optional or mandatory prepayment or redemption, may not be included
 32-9    in the net interest cost.  (V.A.C.S. Art. 717k-2, Sec. 1(c)
32-10    (part).)
32-11          Sec. 1204.005.  COMPUTATION OF NET EFFECTIVE INTEREST RATE.
32-12    (a)  The net effective interest rate of an issue or series of
32-13    public securities is computed by dividing the net interest cost of
32-14    the issue or series by the aggregate total number of public
32-15    security years of all public securities that comprise the issue or
32-16    series and expressing the result as a rate of interest in percent
32-17    per year.
32-18          (b)  In computing the net effective interest rate of an issue
32-19    or series of public securities that includes one or more public
32-20    securities on which interest accruing before the maturity of the
32-21    public security is compounded, the public security years with
32-22    reference to each separate compounding public security are
32-23    increased by an amount obtained by dividing the amount of interest
32-24    that is periodically compounded by 100 and multiplying the
32-25    resulting quotient by the number of years from the date on which
32-26    interest begins to accrue on the amount that is being compounded
32-27    to:
 33-1                (1)  the scheduled date for payment of the amount that
 33-2    is being compounded; or
 33-3                (2)  with respect to a floating rate public security,
 33-4    the date interest on the public security is next computed, if that
 33-5    date is earlier than the scheduled date for payment of the amount
 33-6    that is being compounded.
 33-7          (c)  For purposes of this chapter, interest compounded under
 33-8    Subsection (b) is considered as principal.  (V.A.C.S. Art. 717k-2,
 33-9    Secs.  1(d), (f).)
33-10          Sec. 1204.006.  MAXIMUM INTEREST RATE.  (a)  The maximum rate
33-11    of interest for any issue or series of public securities, including
33-12    an issue or series that is issued in exchange for property, labor,
33-13    services, materials, or equipment under another law, is a net
33-14    effective interest rate of 15 percent.
33-15          (b)  Except as provided by Section 1204.007, a public agency
33-16    may issue and sell any issue or series of its public securities at
33-17    any price and bearing interest at any rate or rates determined by
33-18    the agency's governing body that does not exceed the maximum rate
33-19    under Subsection (a).  (V.A.C.S. Art. 717k-2, Secs. 2(a), 4.)
33-20          Sec. 1204.007.  MAXIMUM INTEREST RATE FOR CERTAIN PUBLIC
33-21    SECURITIES.  (a)  Public securities authorized by an election held
33-22    before April 15, 1981, may be issued, may be sold, and may bear
33-23    interest as provided by Section 1204.006, except that public
33-24    securities authorized by an election required by the constitution
33-25    of this state may not be issued at an interest rate greater than
33-26    the rate authorized at that election unless an additional election
33-27    is held at which the issuance of the public securities at a price
 34-1    and at a rate authorized by Section 1204.006 is approved.
 34-2          (b)  A public agency shall hold and give notice of an
 34-3    additional election under Subsection (a) in the manner provided by
 34-4    law applicable to the election that authorized the public
 34-5    securities.  (V.A.C.S. Art. 717k-2, Sec. 2(b).)
 34-6        CHAPTER 1205.  PUBLIC SECURITY DECLARATORY JUDGMENT ACTIONS
 34-7                     SUBCHAPTER A.  GENERAL PROVISIONS
 34-8    Sec. 1205.001.  DEFINITIONS
 34-9    Sec. 1205.002.  CONFLICT OR INCONSISTENCY WITH OTHER
34-10                      LAWS
34-11            (Sections 1205.003-1205.020 reserved for expansion)
34-12                SUBCHAPTER B.  DECLARATORY JUDGMENT ACTION
34-13    Sec. 1205.021.  AUTHORITY TO BRING ACTION
34-14    Sec. 1205.022.  VENUE
34-15    Sec. 1205.023.  PROCEEDING IN REM; CLASS ACTION
34-16    Sec. 1205.024.  PLEADING CONTENTS
34-17    Sec. 1205.025.  TIME FOR BRINGING ACTION; PENDENCY OF
34-18                      OTHER PROCEEDINGS
34-19            (Sections 1205.026-1205.040 reserved for expansion)
34-20           SUBCHAPTER C.  NOTICE OF DECLARATORY JUDGMENT ACTION
34-21    Sec. 1205.041.  NOTICE TO INTERESTED PARTIES
34-22    Sec. 1205.042.  SERVICE OF NOTICE ON ATTORNEY GENERAL;
34-23                      WAIVER OF SERVICE
34-24    Sec. 1205.043.  PUBLICATION OF NOTICE
34-25    Sec. 1205.044.  EFFECT OF PUBLICATION
34-26            (Sections 1205.045-1205.060 reserved for expansion)
34-27                SUBCHAPTER D.  TRIAL AND APPEAL PROCEEDINGS
 35-1    Sec. 1205.061.  COURT'S POWER TO ENJOIN OTHER PROCEEDINGS
 35-2    Sec. 1205.062.  ANSWER OR INTERVENTION BY INTERESTED PARTIES
 35-3    Sec. 1205.063.  DUTIES OF ATTORNEY GENERAL
 35-4    Sec. 1205.064.  INSPECTION OF RECORDS OF ISSUER
 35-5    Sec. 1205.065.  TRIAL OF ACTION
 35-6    Sec. 1205.066.  COURT COSTS AND OTHER EXPENSES
 35-7    Sec. 1205.067.  MILEAGE AND TRAVEL EXPENSES OF ATTORNEY
 35-8                      GENERAL
 35-9    Sec. 1205.068.  APPEALS
35-10    Sec. 1205.069.  LEGISLATIVE CONTINUANCES
35-11            (Sections 1205.070-1205.100 reserved for expansion)
35-12                    SUBCHAPTER E.  SECURITY FOR ISSUER
35-13    Sec. 1205.101.  SECURITY AGAINST SUIT
35-14    Sec. 1205.102.  STANDARD FOR GRANTING OF MOTION
35-15    Sec. 1205.103.  AMOUNT OF BOND
35-16    Sec. 1205.104.  FAILURE TO FILE BOND
35-17    Sec. 1205.105.  APPEAL
35-18            (Sections 1205.106-1205.150 reserved for expansion)
35-19               SUBCHAPTER F.  EFFECT OF DECLARATORY JUDGMENT
35-20    Sec. 1205.151.  EFFECT OF JUDGMENT
35-21    Sec. 1205.152.  STATEMENT ON VALIDATED PUBLIC SECURITY
35-22        CHAPTER 1205.  PUBLIC SECURITY DECLARATORY JUDGMENT ACTIONS
35-23                     SUBCHAPTER A.  GENERAL PROVISIONS
35-24          Sec. 1205.001.  DEFINITIONS.  In this chapter:
35-25                (1)  "Issuer" means an agency, authority, board, body
35-26    politic, commission, department, district, instrumentality,
35-27    municipality or other political subdivision, or public corporation
 36-1    of this state.  The term includes a state-supported institution of
 36-2    higher education and any other type of political or governmental
 36-3    entity of this state.
 36-4                (2)  "Public security" means an interest-bearing
 36-5    obligation, including a bond, bond anticipation note, certificate,
 36-6    note, warrant, or other evidence of indebtedness, regardless of
 36-7    whether the obligation is:
 36-8                      (A)  general or special;
 36-9                      (B)  negotiable;
36-10                      (C)  in bearer or registered form;
36-11                      (D)  in temporary or permanent form;
36-12                      (E)  issued with interest coupons; or
36-13                      (F)  to be repaid from taxes, revenue, both taxes
36-14    and revenue, or in another manner.
36-15                (3)  "Public security authorization" means an action or
36-16    proceeding by an issuer taken, made, or proposed to be taken or
36-17    made in connection with or affecting a public security.  (V.A.C.S.
36-18    Art. 717m-1, Sec. 1; New.)
36-19          Sec. 1205.002.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS.
36-20    (a)  To the extent of a conflict or inconsistency between this
36-21    chapter and another law, this chapter controls.
36-22          (b)  This chapter does not prohibit an issuer from applying
36-23    to the Texas Supreme Court for a writ of mandamus to the attorney
36-24    general for the approval of a bond, and the court is authorized to
36-25    issue the writ.  (V.A.C.S. Art. 717m-1, Sec. 13 (part).)
36-26            (Sections 1205.003-1205.020 reserved for expansion)
36-27                SUBCHAPTER B.  DECLARATORY JUDGMENT ACTION
 37-1          Sec. 1205.021.  AUTHORITY TO BRING ACTION.  An issuer may
 37-2    bring an action under this chapter to obtain a declaratory judgment
 37-3    as to:
 37-4                (1)  the authority of the issuer to issue the public
 37-5    securities;
 37-6                (2)  the legality and validity of each public security
 37-7    authorization relating to the public securities, including if
 37-8    appropriate:
 37-9                      (A)  the election at which the public securities
37-10    were authorized;
37-11                      (B)  the organization or boundaries of the
37-12    issuer;
37-13                      (C)  the imposition of an assessment, a tax, or a
37-14    tax lien;
37-15                      (D)  the execution or proposed execution of a
37-16    contract;
37-17                      (E)  the imposition of a rate, fee, charge, or
37-18    toll or the enforcement of a remedy relating to the imposition of
37-19    that rate, fee, charge, or toll; and
37-20                      (F)  the pledge or encumbrance of a tax, revenue,
37-21    receipts, or property to secure the public securities;
37-22                (3)  the legality and validity of each expenditure or
37-23    proposed expenditure of money relating to the public securities;
37-24    and
37-25                (4)  the legality and validity of the public
37-26    securities.  (V.A.C.S.  Art. 717m-1, Secs. 2 (part), 13 (part).)
37-27          Sec. 1205.022.  VENUE.  An issuer may bring an action under
 38-1    this chapter in a district court of Travis County or of the county
 38-2    in which the issuer has its principal office.  (V.A.C.S.
 38-3    Art. 717m-1, Sec. 2 (part).)
 38-4          Sec. 1205.023.  PROCEEDING IN REM; CLASS ACTION.  An action
 38-5    under this chapter is:
 38-6                (1)  a proceeding in rem; and
 38-7                (2)  a class action against all persons who:
 38-8                      (A)  reside in the territory of the issuer;
 38-9                      (B)  own property located within the boundaries
38-10    of the issuer;
38-11                      (C)  are taxpayers of the issuer; or
38-12                      (D)  have or claim a right, title, or interest in
38-13    any property or money to be affected by the public security
38-14    authorization or the issuance of the public securities.  (V.A.C.S.
38-15    Art. 717m-1, Sec. 2 (part).)
38-16          Sec. 1205.024.  PLEADING CONTENTS.  The petition in an action
38-17    under this chapter must briefly set out, by allegation, reference,
38-18    or exhibit:
38-19                (1)  the issuer's authority to issue the public
38-20    securities;
38-21                (2)  the purpose of the public securities;
38-22                (3)  the holding and result of any required election;
38-23                (4)  a copy of or a pertinent excerpt from each public
38-24    security authorization, including any essential action or
38-25    expenditure of money;
38-26                (5)  the amount or proposed maximum amount of the
38-27    public securities;
 39-1                (6)  the interest rate or rates or the proposed maximum
 39-2    interest rate of the public securities;
 39-3                (7)  in a suit relating to the validity or organization
 39-4    of an issuer, the authority for and the proceedings relating to the
 39-5    creation of the issuer or a boundary change; and
 39-6                (8)  any other pertinent matter.  (V.A.C.S.
 39-7    Art. 717m-1, Sec. 3.)
 39-8          Sec. 1205.025.  TIME FOR BRINGING ACTION; PENDENCY OF OTHER
 39-9    PROCEEDINGS.  An issuer may bring an action under this chapter:
39-10                (1)  concurrently with or after the use of another
39-11    procedure to obtain a declaratory judgment, approval, or
39-12    validation;
39-13                (2)  before or after the public securities are
39-14    authorized, issued, or delivered;
39-15                (3)  before or after the attorney general approves the
39-16    public securities; and
39-17                (4)  regardless of whether another proceeding is
39-18    pending in any court relating to a matter to be adjudicated in the
39-19    suit.  (V.A.C.S. Art. 717m-1, Secs. 2 (part), 13 (part).)
39-20            (Sections 1205.026-1205.040 reserved for expansion)
39-21           SUBCHAPTER C.  NOTICE OF DECLARATORY JUDGMENT ACTION
39-22          Sec. 1205.041.  NOTICE TO INTERESTED PARTIES.  (a)  The court
39-23    in which an action under this chapter is brought shall, on receipt
39-24    of the petition, immediately issue an order, in the form of a
39-25    notice, directed to all persons who:
39-26                (1)  reside in the territory of the issuer;
39-27                (2)  own property located within the boundaries of the
 40-1    issuer;
 40-2                (3)  are taxpayers of the issuer; or
 40-3                (4)  have or claim a right, title, or interest in any
 40-4    property or money to be affected by a public security authorization
 40-5    or the issuance of the public securities.
 40-6          (b)  The order must, in general terms and without naming
 40-7    them, require the persons described by Subsection (a) and the
 40-8    attorney general to:
 40-9                (1)  appear for trial at 10 a.m. on the first Monday
40-10    after the 20th day after the date of the order; and
40-11                (2)  show cause why the petition should not be granted
40-12    and the public securities or the public security authorization
40-13    validated and confirmed.
40-14          (c)  The order must give a general description of the
40-15    petition but is not required to contain the entire petition or any
40-16    exhibit attached to the petition.  (V.A.C.S. Art. 717m-1, Sec. 4
40-17    (part).)
40-18          Sec. 1205.042.  SERVICE OF NOTICE ON ATTORNEY GENERAL; WAIVER
40-19    OF SERVICE.  (a)  A copy of the issuer's petition with all attached
40-20    exhibits and a copy of the order issued under Section 1205.041(a)
40-21    shall be served on the attorney general before the 20th day before
40-22    the trial date.
40-23          (b)  The attorney general may waive the service if the
40-24    attorney general has been provided a certified copy of the
40-25    petition, order, and a transcript of each pertinent public security
40-26    authorization relating to the matters described in the petition.
40-27    (V.A.C.S. Art. 717m-1, Sec. 4 (part).)
 41-1          Sec. 1205.043.  PUBLICATION OF NOTICE.  (a)  The clerk of the
 41-2    court shall give notice by publishing a substantial copy of the
 41-3    order issued under Section 1205.041(a) in a newspaper of general
 41-4    circulation in:
 41-5                (1)  Travis County;
 41-6                (2)  the county where the issuer has its principal
 41-7    office; and
 41-8                (3)  if the issuer has defined boundaries, each county
 41-9    in which the issuer has territory.
41-10          (b)  The notice shall be published once in each of two
41-11    consecutive calendar weeks, with the date of the first publication
41-12    before the 14th day before the trial date.
41-13          (c)  If the issuer is this state, Subsection (a)(3) does not
41-14    apply.  (V.A.C.S. Art. 717m-1, Sec. 6 (part).)
41-15          Sec. 1205.044.  EFFECT OF PUBLICATION.  The effect of notice
41-16    given under Sections 1205.041 and 1205.043 is that:
41-17                (1)  each person described by Section 1205.041(a) is a
41-18    defendant to the action; and
41-19                (2)  the court has jurisdiction over each person to the
41-20    same extent as if that person were individually named as a
41-21    defendant and personally served in the action.  (V.A.C.S.
41-22    Art. 717m-1, Sec. 6 (part).)
41-23            (Sections 1205.045-1205.060 reserved for expansion)
41-24                SUBCHAPTER D.  TRIAL AND APPEAL PROCEEDINGS
41-25          Sec. 1205.061.  COURT'S POWER TO ENJOIN OTHER PROCEEDINGS.
41-26    (a)  On the issuer's motion, before or after the trial date set
41-27    under Section 1205.041, the court may enjoin the commencement,
 42-1    prosecution, or maintenance of any proceeding by any person that
 42-2    contests the validity of:
 42-3                (1)  any organizational proceeding or boundary change
 42-4    of the issuer;
 42-5                (2)  public securities that are described in the
 42-6    petition for declaratory judgment action;
 42-7                (3)  a public security authorization relating to the
 42-8    public securities;
 42-9                (4)  an action or expenditure of money relating to the
42-10    public securities, a proposed action or expenditure, or both;
42-11                (5)  a tax, assessment, toll, fee, rate, or other
42-12    charge authorized to be imposed or made for the payment of the
42-13    public securities or interest on the public securities; or
42-14                (6)  a pledge of any revenue, receipt, or property, or
42-15    an encumbrance on a tax, assessment, toll, fee, rate, or other
42-16    charge, to secure that payment.
42-17          (b)  The court may:
42-18                (1)  order a joint trial on all issues pending in any
42-19    other proceeding in a court in this state and the consolidation of
42-20    the proceeding with the action under this chapter; and
42-21                (2)  issue necessary or proper orders to effect the
42-22    consolidation that will avoid unnecessary costs or delays or a
42-23    multiplicity of proceedings.
42-24          (c)  An interlocutory order issued under this section is
42-25    final and may not be appealed.  (V.A.C.S. Art. 717m-1, Sec. 5.)
42-26          Sec. 1205.062.  ANSWER OR INTERVENTION BY INTERESTED PARTIES.
42-27    A person described by Section 1205.041(a) may become a named party
 43-1    to an action brought under this chapter by:
 43-2                (1)  filing an answer with the court at or before the
 43-3    time set for trial under Section 1205.041; or
 43-4                (2)  intervening, with leave of court, after the trial
 43-5    date.  (V.A.C.S. Art. 717m-1, Sec. 7 (part).)
 43-6          Sec. 1205.063.  DUTIES OF ATTORNEY GENERAL.  (a)  The
 43-7    attorney general shall examine a petition filed under Section
 43-8    1205.021, and shall raise appropriate defenses if the attorney
 43-9    general believes that:
43-10                (1)  the petition is defective, insufficient, or
43-11    untrue; or
43-12                (2)  the public securities are, or the public security
43-13    authorization or an expenditure of money relating to the public
43-14    securities is, or will be invalid or unauthorized.
43-15          (b)  If the attorney general does not question the validity
43-16    of the public securities, the public security authorization, or an
43-17    expenditure of money relating to the public securities or the
43-18    security or provisions for the payment of the public securities,
43-19    the attorney general may:
43-20                (1)  state that belief; and
43-21                (2)  on a finding by the court to that effect, be
43-22    dismissed as a party.  (V.A.C.S. Art. 717m-1, Sec. 4 (part); New.)
43-23          Sec. 1205.064.  INSPECTION OF RECORDS OF ISSUER.  (a)  Each
43-24    record of an issuer relating to the public securities, a public
43-25    security authorization, or an expenditure of money relating to the
43-26    public securities is open to inspection at reasonable times to any
43-27    party to an action under this chapter.
 44-1          (b)  Each officer, agent, or employee with possession,
 44-2    custody, or control of any book, paper, or record of the issuer
 44-3    shall, on demand of the attorney general:
 44-4                (1)  allow examination of the book, paper, or record;
 44-5    and
 44-6                (2)  without cost, provide an authenticated copy that
 44-7    pertains to or may affect the legality of the public securities,
 44-8    public security authorization, or an expenditure of money relating
 44-9    to the public securities.  (V.A.C.S. Art. 717m-1, Sec. 4 (part);
44-10    New.)
44-11          Sec. 1205.065.  TRIAL OF ACTION.  (a)  The court shall with
44-12    the least possible delay:
44-13                (1)  hear and determine each legal or factual question
44-14    in the declaratory judgment action; and
44-15                (2)  render a final judgment.
44-16          (b)  Regardless of the pendency of an appeal from an order
44-17    entered under Subchapter E, on motion of the issuer, the trial
44-18    judge shall proceed under Subsection (a).  (V.A.C.S. Art. 717m-1,
44-19    Secs. 7 (part), 8 (part).)
44-20          Sec. 1205.066.  COURT COSTS AND OTHER EXPENSES.  (a)  An
44-21    issuer that brings an action under this chapter shall pay costs of
44-22    the action, except as provided by Subsection (b).
44-23          (b)  The court may require a person other than the attorney
44-24    general who appears and contests or intervenes in the action to pay
44-25    all or part of the costs as the court determines equitable and
44-26    just.  (V.A.C.S. Art. 717m-1, Sec. 12.)
44-27          Sec. 1205.067.  MILEAGE AND TRAVEL EXPENSES OF ATTORNEY
 45-1    GENERAL.  (a)  If an action under this chapter is brought in a
 45-2    county other than Travis County, the issuer shall pay any mileage
 45-3    or travel expense of the attorney general or an assistant attorney
 45-4    general in the amount this state allows to an official of this
 45-5    state for travel on official business.
 45-6          (b)  A claim for an expense under Subsection (a):
 45-7                (1)  must be filed in duplicate with the clerk of the
 45-8    court in which the action is pending; and
 45-9                (2)  shall be taxed as a cost against the issuer.
45-10    (V.A.C.S. Art. 717m-1, Sec. 4 (part).)
45-11          Sec. 1205.068.  APPEALS.  (a)  Any party to an action under
45-12    this chapter may appeal to the appropriate court of appeals:
45-13                (1)  an order entered by the trial court under Section
45-14    1205.103 or 1205.104; or
45-15                (2)  the judgment rendered by the trial court.
45-16          (b)  A party may take a direct appeal to the supreme court as
45-17    provided by Section 22.001(c).
45-18          (c)  An order or judgment from which an appeal is not taken
45-19    is final.
45-20          (d)  An order or judgment of a court of appeals may be
45-21    appealed to the supreme court.
45-22          (e)  An appeal under this section takes priority over any
45-23    other matter, other than writs of habeas corpus, pending in the
45-24    appellate court.  The appellate court shall render its final order
45-25    or judgment with the least possible delay.  (V.A.C.S. Art. 717m-1,
45-26    Sec. 9 (part).)
45-27          Sec. 1205.069.  LEGISLATIVE CONTINUANCES.  Rule 254, Texas
 46-1    Rules of Civil Procedure, and Section 30.003, Civil Practice and
 46-2    Remedies Code, do not apply to a suit or an appeal under this
 46-3    chapter.  (V.A.C.S. Art. 717m-1, Sec. 7 (part).)
 46-4            (Sections 1205.070-1205.100 reserved for expansion)
 46-5                    SUBCHAPTER E.  SECURITY FOR ISSUER
 46-6          Sec. 1205.101.  SECURITY AGAINST SUIT.  (a)  Before the entry
 46-7    of final judgment in an action under this chapter, the issuer may
 46-8    file a motion with the court for an order that any opposing party
 46-9    or intervenor, other than the attorney general, be dismissed unless
46-10    that person posts a bond with sufficient surety, approved by the
46-11    court, and payable to the issuer for any damage or cost that may
46-12    occur because of the delay caused by the continued participation of
46-13    the opposing party or intervenor in the action if the issuer
46-14    finally prevails and obtains substantially the judgment requested
46-15    in its petition.
46-16          (b)  On receipt of a motion under Subsection (a), the court
46-17    shall issue an order directed to the opposing party or intervenor,
46-18    with a copy of the motion, to be served on the opposing party, the
46-19    intervenor, or the party's attorney, personally or by registered
46-20    mail, requiring the opposing party or intervenor to:
46-21                (1)  appear at the time and place directed by the
46-22    court, not before the sixth or later than the 10th day after the
46-23    date the order is entered; and
46-24                (2)  show cause why the motion should not be granted.
46-25          (c)  The court may direct that motions relating to more than
46-26    one party or intervenor be heard together.  (V.A.C.S. Art. 717m-1,
46-27    Sec. 8 (part).)
 47-1          Sec. 1205.102.  STANDARD FOR GRANTING OF MOTION.  The court
 47-2    shall grant an issuer's motion for security under Section 1205.101
 47-3    unless, at the hearing on the motion, the opposing party or
 47-4    intervenor establishes that the person is entitled to a temporary
 47-5    injunction against the issuance of the public securities.
 47-6    (V.A.C.S. Art. 717m-1, Sec. 8 (part).)
 47-7          Sec. 1205.103.  AMOUNT OF BOND.  (a)  The court that grants a
 47-8    motion under this subchapter as to a particular opposing party or
 47-9    intervenor shall in the order set the amount of the bond to be
47-10    posted by that person.
47-11          (b)  The bond must be in an amount determined by the court to
47-12    be sufficient to cover any damage or cost, including an anticipated
47-13    increase in interest rates or in a construction or financing cost,
47-14    that may occur because of the delay caused by the continued
47-15    participation of the opposing party or intervenor in the acts if
47-16    the issuer finally prevails and obtains substantially the judgment
47-17    requested in its petition.
47-18          (c)  The court may receive evidence at the hearing or during
47-19    any adjournment relating to the amount of the potential damage or
47-20    cost.
47-21          (d)  The court may allocate the amount of the bond among
47-22    opposing parties and intervenors according to the extent of their
47-23    participation.  (V.A.C.S. Art. 717m-1, Sec. 8 (part).)
47-24          Sec. 1205.104.  FAILURE TO FILE BOND.  (a)  The court shall
47-25    dismiss an opposing party or intervenor who does not file a
47-26    required bond before the 11th day after the date of the entry of
47-27    the order setting the amount of the bond.
 48-1          (b)  A dismissal under this section is a final judgment of
 48-2    the court, unless appealed under Section 1205.068.
 48-3          (c)  No court has further jurisdiction over any action to the
 48-4    extent that action involves any issue that was or could have been
 48-5    raised in the action under this chapter, other than an issue that
 48-6    may have been raised by an opposing party or intervenor who was not
 48-7    subject to the motion.  (V.A.C.S. Art. 717m-1, Sec. 8 (part).)
 48-8          Sec. 1205.105.  APPEAL.  (a)  An order setting the amount of
 48-9    a bond denying the motion of an issuer for a bond, or dismissing a
48-10    party for failure to file a bond may be appealed under Section
48-11    1205.068.
48-12          (b)  An appellate court may:
48-13                (1)  modify an order of a lower court; and
48-14                (2)  enter the modified order as the final order.
48-15          (c)  If an appeal is not taken or if the appeal is taken and
48-16    the order of the lower court is affirmed or affirmed as modified,
48-17    and the required bond is not posted before the 11th day after the
48-18    date of the entry of the appropriate order, no court has further
48-19    jurisdiction over any action to the extent it involves an issue
48-20    that was or could have been raised in the action under this
48-21    chapter, other than an issue that may have been raised by an
48-22    opposing party or intervenor who was not subject to the motion.
48-23    (V.A.C.S. Art. 717m-1, Sec. 8 (part).)
48-24            (Sections 1205.106-1205.150 reserved for expansion)
48-25               SUBCHAPTER F.  EFFECT OF DECLARATORY JUDGMENT
48-26          Sec. 1205.151.  EFFECT OF JUDGMENT.  (a)  This section
48-27    applies to a final judgment of a district court in an action under
 49-1    this chapter that holds that under the terms set out in the
 49-2    petition:
 49-3                (1)  the issuer had or has the authority to:
 49-4                      (A)  issue the public securities; or
 49-5                      (B)  take each public security authorization; and
 49-6                (2)  each public security authorization and expenditure
 49-7    of money relating to the public securities was legal.
 49-8          (b)  The judgment, as to each adjudicated matter and each
 49-9    matter that could have been raised, is binding and conclusive
49-10    against:
49-11                (1)  the issuer;
49-12                (2)  the attorney general;
49-13                (3)  the comptroller; and
49-14                (4)  any party to the action, whether:
49-15                      (A)  named and served with the notice of the
49-16    proceedings; or
49-17                      (B)  described by Section 1205.041(a).
49-18          (c)  The judgment is a permanent injunction against the
49-19    filing by any person of any proceeding contesting the validity of:
49-20                (1)  the public securities, a public security
49-21    authorization, or an expenditure of money relating to the public
49-22    securities described in the petition;
49-23                (2)  each provision made for the payment of the public
49-24    securities or of any interest on the public securities; and
49-25                (3)  any adjudicated matter and any matter that could
49-26    have been raised in the action.  (V.A.C.S. Art. 717m-1, Sec. 10
49-27    (part); New.)
 50-1          Sec. 1205.152.  STATEMENT ON VALIDATED PUBLIC SECURITY.  (a)
 50-2    The issuer of a public security validated under this chapter may
 50-3    have written on the public security the following certificate:
 50-4                "This obligation was validated and confirmed by a
 50-5          judgment entered ______________ (date when the judgment
 50-6          was entered; the court entering the judgment; and the
 50-7          style and number of the declaratory judgment action),
 50-8          which perpetually enjoins the commencement of any suit,
 50-9          action, or proceeding involving the validity of this
50-10          obligation, or the provision made for the payment of
50-11          the principal and interest of the obligation."
50-12          (b)  The clerk, secretary, or other official of the issuer
50-13    may sign the certificate.  (V.A.C.S.  Art. 717m-1, Sec. 11 (part).)
50-14        CHAPTER 1206.  REPLACEMENT FOR DAMAGED, DESTROYED, LOST, OR
50-15                         STOLEN PUBLIC SECURITIES
50-16      SUBCHAPTER A.  REPLACEMENT PROCEDURES IN ABSENCE OF PROCEDURES
50-17        PRESCRIBED IN ORIGINAL BOND RESOLUTION, ORDER, OR ORDINANCE
50-18    Sec. 1206.001.  DEFINITION
50-19    Sec. 1206.002.  ISSUANCE OF REPLACEMENT BOND
50-20    Sec. 1206.003.  EFFECT AND FORM OF REPLACEMENT BOND
50-21    Sec. 1206.004.  ATTORNEY GENERAL APPROVAL
50-22    Sec. 1206.005.  REGISTRATION
50-23    Sec. 1206.006.  FORM AND IDENTITY CHANGES
50-24            (Sections 1206.007-1206.020 reserved for expansion)
50-25          SUBCHAPTER B.  REPLACEMENT PROCEDURES AS PRESCRIBED IN
50-26                  ORIGINAL PUBLIC SECURITY AUTHORIZATION
50-27    Sec. 1206.021.  DEFINITIONS
 51-1    Sec. 1206.022.  PRESCRIPTION OF PROCEDURES IN ORIGINAL PUBLIC
 51-2                      SECURITY AUTHORIZATION
 51-3    Sec. 1206.023.  EXCEPTION TO APPROVAL REQUIREMENT
 51-4        CHAPTER 1206.  REPLACEMENT FOR DAMAGED, DESTROYED, LOST, OR
 51-5                         STOLEN PUBLIC SECURITIES
 51-6      SUBCHAPTER A.  REPLACEMENT PROCEDURES IN ABSENCE OF PROCEDURES
 51-7        PRESCRIBED IN ORIGINAL BOND RESOLUTION, ORDER, OR ORDINANCE
 51-8          Sec. 1206.001.  DEFINITION.  In this subchapter, "issuer"
 51-9    means this state, a department, agency, or instrumentality of this
51-10    state, or a municipal corporation or other political subdivision of
51-11    this state that is authorized to borrow money and issue bonds.
51-12    (V.A.C.S. Art. 715a, Sec. 1.)
51-13          Sec. 1206.002.  ISSUANCE OF REPLACEMENT BOND.  (a)  An issuer
51-14    may, without an election, issue a bond:
51-15                (1)  to be exchanged for a damaged bond; or
51-16                (2)  to replace a destroyed, lost, or stolen bond.
51-17          (b)  A replacement bond may be issued under this subchapter
51-18    only for a bond that is outstanding and that was lawfully issued.
51-19          (c)  A replacement bond issued under Subsection (a)(2) must
51-20    be issued on indemnity satisfactory to:
51-21                (1)  the issuer; and
51-22                (2)  the trustee if the bond being replaced is secured
51-23    by a trust indenture.
51-24          (d)  An issuer may require an affidavit or another form of
51-25    evidence satisfactory to the issuer to establish ownership and the
51-26    circumstances of the damage, destruction, loss, or theft of the
51-27    bond.  (V.A.C.S. Art. 715a, Sec. 2.)
 52-1          Sec. 1206.003.  EFFECT AND FORM OF REPLACEMENT BOND.  (a)  A
 52-2    replacement bond issued under this subchapter must be of like tenor
 52-3    and effect as the bond that it is issued to replace.
 52-4          (b)  A replacement bond issued under this subchapter must
 52-5    bear a date specified by the issuer and must be signed as provided
 52-6    by law by the officers of the issuer holding office when the
 52-7    replacement bond is issued.  (V.A.C.S.  Art. 715a, Sec. 3.)
 52-8          Sec. 1206.004.  ATTORNEY GENERAL APPROVAL.  (a)  A
 52-9    replacement bond issued under this subchapter must be submitted to
52-10    the attorney general for approval.
52-11          (b)  If the attorney general finds that the replacement bond
52-12    has been issued in accordance with this subchapter, the attorney
52-13    general shall:
52-14                (1)  approve the bond; and
52-15                (2)  send the bond to the comptroller for registration.
52-16    (V.A.C.S. Art. 715a, Sec. 4 (part).)
52-17          Sec. 1206.005.  REGISTRATION.  (a)  The comptroller shall
52-18    register a replacement bond received under Section 1206.004 in the
52-19    same manner as the original bond was registered, giving it the same
52-20    registration number as the original bond, except that the
52-21    registration number must be preceded by the letter "R."
52-22          (b)  The comptroller shall date the registration certificate
52-23    as of the date of registration of the replacement bond.
52-24          (c)  Before registering a bond issued to replace a damaged
52-25    bond, the comptroller shall cancel the bond being replaced and
52-26    return that bond to the issuer.  The comptroller shall register
52-27    another bond authorized under this subchapter on certification from
 53-1    the attorney general that the bond is being issued to replace a
 53-2    lost, stolen, or destroyed bond.  (V.A.C.S.  Art. 715a, Sec. 4
 53-3    (part).)
 53-4          Sec. 1206.006.  FORM AND IDENTITY CHANGES.  (a)  An applicant
 53-5    to the comptroller for replacement under this subchapter of a bond
 53-6    that is damaged, destroyed, lost, or stolen and that, as described
 53-7    in the application, does not appear in the comptroller's records in
 53-8    the form and bear the identity originally registered by the
 53-9    comptroller must provide to the comptroller a chronology of the
53-10    changes from the original, registered form and identity.
53-11          (b)  The chronology must enable the comptroller, under the
53-12    comptroller's rules, to trace the changes in form and identity of
53-13    the bond to the original, registered form and identity.  (V.A.C.S.
53-14    Art. 715b, Sec.  7(b).)
53-15            (Sections 1206.007-1206.020 reserved for expansion)
53-16          SUBCHAPTER B.  REPLACEMENT PROCEDURES AS PRESCRIBED IN
53-17                  ORIGINAL PUBLIC SECURITY AUTHORIZATION
53-18          Sec. 1206.021.  DEFINITIONS.  In this subchapter, "issuer,"
53-19    "public security," and "public security authorization" have the
53-20    meanings assigned by Section 1201.002.  (New.)
53-21          Sec. 1206.022.  PRESCRIPTION OF PROCEDURES IN ORIGINAL PUBLIC
53-22    SECURITY AUTHORIZATION.  The governing body of an issuer may
53-23    provide procedures for the replacement of lost, stolen, destroyed,
53-24    or mutilated public securities or interest coupons in the manner
53-25    prescribed in the public security authorization.  (V.A.C.S.
53-26    Art. 717k-6, Sec. 6(b) (part).)
53-27          Sec. 1206.023.  EXCEPTION TO APPROVAL REQUIREMENT.  (a)  If
 54-1    the duty to replace a public security or interest coupon is imposed
 54-2    on a corporate trustee under a trust agreement or indenture or on a
 54-3    paying agent for the public security, the attorney general is not
 54-4    required to approve and the comptroller is not required to
 54-5    register:
 54-6                (1)  the replacement public security or interest
 54-7    coupon; or
 54-8                (2)  the public security delivered on exchange of the
 54-9    previously issued public security.
54-10          (b)  A replacement public security or interest coupon is
54-11    valid and incontestable in the same manner and with the same effect
54-12    as the previously issued public security.  (V.A.C.S. Art. 717k-6,
54-13    Sec. 6(b) (part).)
54-14                      CHAPTER 1207.  REFUNDING BONDS
54-15                     SUBCHAPTER A.  GENERAL PROVISIONS
54-16    Sec. 1207.001.  DEFINITIONS
54-17    Sec. 1207.002.  AUTHORITY TO ISSUE
54-18    Sec. 1207.003.  ELECTION
54-19    Sec. 1207.004.  COMBINATION ISSUANCE
54-20    Sec. 1207.005.  SOURCES AVAILABLE FOR PAYMENT
54-21    Sec. 1207.006.  MATURITY
54-22            (Sections 1207.007-1207.020 reserved for expansion)
54-23                SUBCHAPTER B.  ADVANCE REFUNDING PROCEDURES
54-24    Sec. 1207.021.  AUTHORITY TO DEPOSIT WITH COMPTROLLER
54-25    Sec. 1207.022.  LIMITATION
54-26    Sec. 1207.023.  AMOUNT OF PRINCIPAL
54-27    Sec. 1207.024.  METHODS AND TERMS OF SALE
 55-1    Sec. 1207.025.  REGISTRATION BEFORE DEPOSIT; REGISTRATION
 55-2                      WITHOUT CANCELLATION OF OBLIGATIONS TO BE
 55-3                      REFUNDED
 55-4    Sec. 1207.026.  USE OF SALE PROCEEDS TO MAKE DEPOSIT;
 55-5                      RIGHTS NOT DEPENDENT ON CANCELLATION OF
 55-6                      OBLIGATIONS TO BE REFUNDED
 55-7    Sec. 1207.027.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS
 55-8    Sec. 1207.028.  COMPTROLLER TO SEND AND RECORD DEPOSIT OR
 55-9                      PAYMENT
55-10    Sec. 1207.029.  SELECTION OF PAYING AGENT
55-11    Sec. 1207.030.  ESTABLISHMENT AND USE OF TRUST FUND
55-12    Sec. 1207.031.  WITHDRAWAL OF DEPOSIT
55-13    Sec. 1207.032.  COMPTROLLER FEES
55-14    Sec. 1207.033.  DISCHARGE
55-15    Sec. 1207.034.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT
55-16    Sec. 1207.035.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS
55-17            (Sections 1207.036-1207.060 reserved for expansion)
55-18              SUBCHAPTER C.  DIRECT DEPOSIT WITH PAYING AGENT
55-19    Sec. 1207.061.  AUTHORITY TO DEPOSIT DIRECTLY
55-20    Sec. 1207.062.  ESCROW AGREEMENT
55-21    Sec. 1207.063.  DUTY TO COMPLY
55-22    Sec. 1207.064.  INCONTESTABILITY OF CERTAIN ESCROW
55-23                      AGREEMENTS AND CONTRACTS
55-24            (Sections 1207.065-1207.080 reserved for expansion)
55-25               SUBCHAPTER D.  EXCHANGE REFUNDING PROCEDURES
55-26    Sec. 1207.081.  ISSUANCE IN EXCHANGE FOR OBLIGATION TO BE
55-27                      REFUNDED; LIMITATION
 56-1    Sec. 1207.082.  LIMITATION ON AUTHORITY TO PARTIALLY REFUND
 56-2    Sec. 1207.083.  OTHER POWERS OF ISSUER
 56-3    Sec. 1207.084.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS
 56-4                      CHAPTER 1207.  REFUNDING BONDS
 56-5                     SUBCHAPTER A.  GENERAL PROVISIONS
 56-6          Sec. 1207.001.  DEFINITIONS.  In this chapter:
 56-7                (1)  "Issuer" means this state or any department,
 56-8    board, authority, agency, subdivision, municipal corporation,
 56-9    district, public corporation, body politic, or instrumentality of
56-10    this state which has the power to borrow money and issue bonds,
56-11    notes, or other evidences of indebtedness.  The term includes a
56-12    county, municipality, state-supported institution of higher
56-13    education, junior college district, regional college district,
56-14    school district, hospital district, water district, road district,
56-15    navigation district, conservation district, and any other kind or
56-16    type of political or governmental entity.
56-17                (2)  "Paying agent" means the person, including the
56-18    bank or trust company, at whose location payment of refunded
56-19    obligations is to be made.  (V.A.C.S. Art. 717k, Sec. 1 (part);
56-20    Art. 717k-3, Sec. 1 (part); New.)
56-21          Sec. 1207.002.  AUTHORITY TO ISSUE.  An issuer may issue
56-22    refunding bonds under this chapter to refund all or any part of the
56-23    issuer's outstanding bonds, notes, or other general or special
56-24    obligations.  (V.A.C.S. Art. 717k, Sec. 2(a) (part); Art. 717k-3,
56-25    Secs. 2, 5 (part).)
56-26          Sec. 1207.003.  ELECTION.  (a)  Refunding bonds may be issued
56-27    without an election in connection with the issuance of the
 57-1    refunding bonds or the creation of an encumbrance in connection
 57-2    with the refunding bonds, except as provided by Subsection (b).
 57-3          (b)  If the constitution of this state requires an election
 57-4    to permit a procedure, action, or matter pertaining to refunding
 57-5    bonds, an election to authorize the procedure, action, or matter
 57-6    shall be held substantially in accordance, to the extent
 57-7    appropriate, with Chapter 1251.  (V.A.C.S. Art. 717k, Sec. 2(a)
 57-8    (part); Art. 717k-3, Sec. 3 (part).)
 57-9          Sec. 1207.004.  COMBINATION ISSUANCE.  Under the terms and
57-10    with the security set forth in the proceedings that authorize the
57-11    issuance of the refunding bonds, a governmental entity may issue
57-12    refunding bonds:
57-13                (1)  in combination with new bonds;
57-14                (2)  with provision for the subsequent issuance of
57-15    additional parity bonds or subordinate lien bonds; or
57-16                (3)  both in combination with new bonds and with
57-17    provision for the subsequent issuance of additional bonds.
57-18    (V.A.C.S. Art. 717k, Secs. 2(a) (part), 7A (part); Art. 717k-3,
57-19    Sec. 3 (part).)
57-20          Sec. 1207.005.  SOURCES AVAILABLE FOR PAYMENT.  A refunding
57-21    bond may be secured by and made payable from taxes, revenue, or
57-22    both, another source, or a combination of sources, including
57-23    surplus income to be earned from the investment of a deposit made
57-24    under Subchapter C, to the extent the issuer is otherwise
57-25    authorized to secure or pay any type of bond by or from that source
57-26    or those sources.  (V.A.C.S. Art. 717k, Secs. 2(a) (part), 7A
57-27    (part); Art. 717k-3, Sec. 3 (part).)
 58-1          Sec. 1207.006.  MATURITY.  A refunding bond issued under this
 58-2    chapter must mature not later than 40 years after its date.
 58-3    (V.A.C.S. Art. 717k, Secs. 2(a) (part), 7A (part); Art. 717k-3,
 58-4    Sec.  3 (part).)
 58-5            (Sections 1207.007-1207.020 reserved for expansion)
 58-6                SUBCHAPTER B.  ADVANCE REFUNDING PROCEDURES
 58-7          Sec. 1207.021.  AUTHORITY TO DEPOSIT WITH COMPTROLLER.
 58-8    (a)  An issuer is entitled to deposit with the comptroller an
 58-9    amount of money equal to the sum of:
58-10                (1)  the principal amount of the bonds, notes, or other
58-11    obligations to be refunded;
58-12                (2)  the interest that will accrue on those bonds,
58-13    notes, or other obligations computed to the due date or redemption
58-14    date; and
58-15                (3)  any required redemption premium.
58-16          (b)  At the time a deposit is made under Subsection (a), the
58-17    issuer shall deliver to the comptroller a certified copy of the
58-18    proceedings that authorize the issuance of the obligations to be
58-19    refunded, or a certified excerpt from those proceedings, that
58-20    clearly shows:
58-21                (1)  each amount of interest and the date on which that
58-22    amount of interest is due on the obligations to be refunded;
58-23                (2)  the date the principal is subject to redemption;
58-24    and
58-25                (3)  the name and address of the paying agent.
58-26          (c)  The comptroller may rely on a certificate by the issuer
58-27    as to the amount of the charges made by the paying agent.
 59-1    (V.A.C.S. Art. 717k, Sec.  2(b) (part).)
 59-2          Sec. 1207.022.  LIMITATION.  (a)  An issuer may issue
 59-3    refunding bonds to make a deposit under this subchapter or
 59-4    Subchapter C only in connection with refunding bonds issued to
 59-5    refund obligations that are:
 59-6                (1)  scheduled to mature not later than the 20th
 59-7    anniversary of the date of the refunding bonds; or
 59-8                (2)  subject to redemption before maturity not later
 59-9    than the 20th anniversary of the date of the refunding bonds.
59-10          (b)  Refunding bonds may not be issued to make a deposit
59-11    under this subchapter in connection with the refunding of electric
59-12    and gas system bonds issued by a municipality with a population of
59-13    more than 900,000.  (V.A.C.S. Art. 717k, Secs. 2(a) (part), 7A
59-14    (part).)
59-15          Sec. 1207.023.  AMOUNT OF PRINCIPAL.  Refunding bonds for
59-16    which a deposit is made under this subchapter or Subchapter C may
59-17    be issued in an additional amount sufficient to:
59-18                (1)  pay the cost and expense of issuing the bonds; or
59-19                (2)  finance a debt service reserve, contingency, or
59-20    other similar fund the issuer considers necessary or advisable.
59-21    (V.A.C.S. Art. 717k, Sec. 7A (part).)
59-22          Sec. 1207.024.  METHODS AND TERMS OF SALE.  (a)  Refunding
59-23    bonds issued to make a deposit under this subchapter or Subchapter
59-24    C shall be sold for cash in a principal amount necessary to provide
59-25    all or part of the money required to:
59-26                (1)  pay the principal of the obligations to be
59-27    refunded and the interest to accrue on those obligations to their
 60-1    maturity; or
 60-2                (2)  redeem the obligations to be refunded, before
 60-3    maturity, on the date or dates the obligations are subject to
 60-4    redemption, including the principal, interest to accrue on the
 60-5    obligations to their redemption date or dates, and any required
 60-6    redemption premium.
 60-7          (b)  The refunding bonds:
 60-8                (1)  shall be sold under the terms and procedures for
 60-9    the sale as determined by the governing body of the issuer; and
60-10                (2)  may be sold at public or private sale.  (V.A.C.S.
60-11    Art. 717k, Secs.  2(a) (part), 7A (part).)
60-12          Sec. 1207.025.  REGISTRATION BEFORE DEPOSIT; REGISTRATION
60-13    WITHOUT CANCELLATION OF OBLIGATIONS TO BE REFUNDED.  (a)  Refunding
60-14    bonds must be registered by the comptroller as provided by Chapter
60-15    1202 before a deposit required by this subchapter or Subchapter C
60-16    may be made.
60-17          (b)  If the issuer has complied with each applicable
60-18    requirement of this chapter, the comptroller shall register
60-19    refunding bonds issued to make a deposit under this subchapter
60-20    without the surrender, exchange, or cancellation of the obligations
60-21    to be refunded.  (V.A.C.S. Art. 717k, Secs. 2(a) (part), 4 (part),
60-22    7A (part).)
60-23          Sec. 1207.026.  USE OF SALE PROCEEDS TO MAKE DEPOSIT; RIGHTS
60-24    NOT DEPENDENT ON CANCELLATION OF OBLIGATIONS TO BE REFUNDED.
60-25    (a)  An issuer may sell and deliver refunding bonds that have been
60-26    registered with the comptroller so as to permit the issuer, in a
60-27    timely manner determined by the issuer, to use proceeds from the
 61-1    sale to make all or any part of a deposit under this chapter.
 61-2          (b)  An issuer that has complied with this chapter may issue,
 61-3    register, sell, or deliver a refunding bond in lieu of the
 61-4    obligation to be refunded regardless of whether:
 61-5                (1)  the holder of the obligation to be refunded has
 61-6    surrendered or presented the obligation for payment and
 61-7    cancellation; or
 61-8                (2)  the obligation to be refunded has been canceled.
 61-9    (V.A.C.S.  Art. 717k, Secs. 2(a) (part), 4 (part), 5, 7A (part).)
61-10          Sec. 1207.027.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS.
61-11    (a)  The comptroller shall:
61-12                (1)  accept each deposit, payment, or instrument
61-13    received under this subchapter; and                    
61-14                (2)  safely keep and use the money only for a purpose
61-15    specified in this subchapter.
61-16          (b)  Money deposited with the comptroller under this
61-17    subchapter may not be:
61-18                (1)  used by or for the benefit of this state or for
61-19    the benefit of a creditor of this state, except as provided by
61-20    Section 1207.032; or
61-21                (2)  commingled with other money.  (V.A.C.S. Art. 717k,
61-22    Sec. 2(b) (part).)
61-23          Sec. 1207.028.  COMPTROLLER TO SEND AND RECORD DEPOSIT OR
61-24    PAYMENT.  (a)  After receipt of a deposit or payment under this
61-25    subchapter, the comptroller shall immediately and by the most
61-26    expeditious means send to the paying agent for the obligation being
61-27    refunded an amount equal to the deposit or payment less the amount
 62-1    of any fee charged under Section 1207.032.
 62-2          (b)  The comptroller shall notify the paying agent to send to
 62-3    the comptroller the obligation being refunded.
 62-4          (c)  After the comptroller has made a record of its payment
 62-5    and cancellation, the comptroller shall send the obligation being
 62-6    refunded and any interest coupon to the issuer.  (V.A.C.S.
 62-7    Art. 717k, Secs.  3 (part), 7 (part).)
 62-8          Sec. 1207.029.  SELECTION OF PAYING AGENT.  If there is more
 62-9    than one paying agent for an obligation being refunded, the
62-10    comptroller shall send the money directly to:
62-11                (1)  the paying agent located in this state, if only
62-12    one paying agent is located in this state;
62-13                (2)  the paying agent located in this state having the
62-14    largest capital and surplus, if more than one paying agent is
62-15    located in this state; or
62-16                (3)  the paying agent having the largest capital and
62-17    surplus, if no paying agent is located in this state and more than
62-18    one paying agent is located in another state.  (V.A.C.S. Art. 717k,
62-19    Sec. 7 (part).)
62-20          Sec. 1207.030.  ESTABLISHMENT AND USE OF TRUST FUND.  (a)
62-21    The paying agent shall deposit the money received from the
62-22    comptroller, except that amount representing the charges of the
62-23    paying agent, in an interest and sinking fund to be established and
62-24    maintained as a trust fund for the payment of the obligation being
62-25    refunded.
62-26          (b)  The paying agent shall, from the interest and sinking
62-27    fund, pay or redeem the obligations to be refunded when properly
 63-1    presented for payment or redemption.
 63-2          (c)  If there is more than one paying agent, the agent to
 63-3    whom the comptroller sent the money under Section 1207.029 shall
 63-4    make appropriate financial arrangements to ensure that the
 63-5    necessary money will be available to any other paying agent to pay
 63-6    or redeem an obligation to be refunded when presented for payment
 63-7    or redemption.  (V.A.C.S. Art. 717k, Sec. 7 (part).)
 63-8          Sec. 1207.031.  WITHDRAWAL OF DEPOSIT.  (a)  An issuer that
 63-9    has made the deposit and payments required by this subchapter may
63-10    apply to the comptroller to withdraw from the paying agent the
63-11    amount of money deposited to the credit of the account of an
63-12    obligation that has been refunded, including interest and premium,
63-13    if any, by exhibiting the canceled obligation to the comptroller.
63-14    The comptroller shall make a proper record of payment and
63-15    cancellation of that obligation.
63-16          (b)  An issuer may withdraw money deposited under this
63-17    subchapter only if:
63-18                (1)  the conditions stated in Subsection (a) are met;
63-19    or
63-20                (2)  the attorney general certifies to the comptroller
63-21    that the issuer's payment of the obligation as to which the deposit
63-22    was made is barred by limitation and forbidden by law.  (V.A.C.S.
63-23    Art. 717k, Sec. 6.)
63-24          Sec. 1207.032.  COMPTROLLER FEES.  The comptroller may charge
63-25    a reasonable fee for a service performed under this subchapter.
63-26    (V.A.C.S. Art. 717k, Sec.  2(b) (part).)
63-27          Sec. 1207.033.  DISCHARGE.  (a)  A deposit of money made
 64-1    under this chapter is considered to be the making of firm banking
 64-2    and financial arrangements for the discharge and final payment or
 64-3    redemption of the obligations to be refunded or to be paid or
 64-4    redeemed wholly or partly without the issuance of refunding bonds
 64-5    if the deposit is made on or before the payment or redemption date
 64-6    or dates of the obligations.
 64-7          (b)  An issuer may provide in the proceedings authorizing the
 64-8    issuance of the refunding bonds that the refunding bonds are
 64-9    subordinate to the obligations to be refunded.  The subordination
64-10    may be made only in the manner and to the extent specifically
64-11    provided by those proceedings.  (V.A.C.S. Art. 717k, Secs.  7
64-12    (part), 7A (part).)
64-13          Sec. 1207.034.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT.
64-14    The holder of an obligation to be refunded by refunding bonds may
64-15    not demand or receive payment of the obligation to be refunded
64-16    before its scheduled maturity date, due date, or redemption date
64-17    unless the proceedings authorizing the refunding bonds specifically
64-18    provide for the earlier payment.  (V.A.C.S. Art. 717k, Sec. 7
64-19    (part).)
64-20          Sec. 1207.035.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS.
64-21    To the extent of a conflict or inconsistency between this
64-22    subchapter and another law, this subchapter controls. (V.A.C.S.
64-23    Art. 717k, Sec. 9 (part).)
64-24            (Sections 1207.036-1207.060 reserved for expansion)
64-25              SUBCHAPTER C.  DIRECT DEPOSIT WITH PAYING AGENT
64-26          Sec. 1207.061.  AUTHORITY TO DEPOSIT DIRECTLY.  (a) An issuer
64-27    may, in lieu of making a deposit with the comptroller under
 65-1    Subchapter B, deposit an amount of money sufficient to provide for
 65-2    the payment or redemption of the obligations, including assumed
 65-3    obligations, to be refunded or to be paid or redeemed in whole or
 65-4    in part without issuing refunding bonds, directly with:
 65-5                (1)  a paying agent for any of the obligations to be
 65-6    refunded, paid, or redeemed; or
 65-7                (2)  the trustee under a trust indenture, deed of
 65-8    trust, or similar instrument providing security for the obligations
 65-9    to be refunded, paid, or redeemed.
65-10          (b)  An issuer may make a deposit under this section from any
65-11    source, including the proceeds from the sale of the refunding
65-12    bonds.  (V.A.C.S. Art. 717k, Sec. 7A (part).)
65-13          Sec. 1207.062.  ESCROW AGREEMENT.  (a)  An issuer may enter
65-14    into an escrow or similar agreement with a paying agent or trustee
65-15    with respect to the safekeeping, investment, administration, and
65-16    disposition of a deposit made under Section 1207.061.
65-17          (b)  A deposit under Section 1207.061 may be invested only in
65-18    direct obligations of the United States, including obligations the
65-19    principal of and interest on which are unconditionally guaranteed
65-20    by the United States and which mature and bear interest payable at
65-21    times and in amounts sufficient to provide for the scheduled
65-22    payment or redemption of the obligation to be refunded.  The
65-23    obligations may be in book-entry form.
65-24          (c)  An issuer shall enter into an agreement under Subsection
65-25    (a) if an obligation to be refunded is scheduled to be paid or
65-26    redeemed on a date later than the next scheduled interest payment
65-27    date on the obligation.  (V.A.C.S. Art. 717k, Sec. 7A (part).)
 66-1          Sec. 1207.063.  DUTY TO COMPLY.  A paying agent or trustee
 66-2    that enters into an agreement under Section 1207.062 shall comply
 66-3    with each term of that agreement and, from the deposited money and
 66-4    in the manner and to the extent provided by the agreement, make
 66-5    available to any other paying agent or trustee for an obligation of
 66-6    the same or a different series of obligations to be refunded, paid,
 66-7    or redeemed, the amounts required by the terms of the obligation to
 66-8    pay or redeem the principal of and interest on the obligation when
 66-9    due.  (V.A.C.S. Art. 717k, Sec. 7A (part).)
66-10          Sec. 1207.064.  INCONTESTABILITY OF CERTAIN ESCROW AGREEMENTS
66-11    AND CONTRACTS.  After the registration of a refunding bond and the
66-12    sale and delivery of the bond to the purchaser, the proceedings
66-13    that authorize the refunding bond, any escrow agreement relating to
66-14    the refunding bond, and any contract providing security or payments
66-15    with respect to the refunding bond are:
66-16                (1)  incontestable in any court or other forum for any
66-17    reason; and
66-18                (2)  valid and binding obligations in accordance with
66-19    their terms for any purpose.  (V.A.C.S. Art. 717k, Sec. 7A (part).)
66-20            (Sections 1207.065-1207.080 reserved for expansion)
66-21               SUBCHAPTER D.  EXCHANGE REFUNDING PROCEDURES
66-22          Sec. 1207.081.  ISSUANCE IN EXCHANGE FOR OBLIGATION TO BE
66-23    REFUNDED; LIMITATION.  (a)  Refunding bonds may be issued to be
66-24    exchanged under this subchapter for, and on the surrender and
66-25    cancellation of, the obligations to be refunded.
66-26          (b)  The comptroller shall register a refunding bond and
66-27    deliver it to the holder of the obligation to be refunded, in
 67-1    accordance with the proceedings authorizing the refunding bond.
 67-2    The exchange may be made in one delivery or in installment
 67-3    deliveries.
 67-4          (c)  Refunding bonds may not be issued to be exchanged under
 67-5    this subchapter for electric and gas system revenue bonds issued by
 67-6    a municipality with a population of more than 900,000.  (V.A.C.S.
 67-7    Art. 717k-3, Secs. 3 (part), 5 (part).)
 67-8          Sec. 1207.082.  LIMITATION ON AUTHORITY TO PARTIALLY REFUND.
 67-9    An issuer may issue refunding bonds to be exchanged under this
67-10    subchapter to refund part of an outstanding issue of bonds, notes,
67-11    or other obligations only if the issuer demonstrates to the
67-12    attorney general at the time of the refunding that, based on then
67-13    current conditions, the issuer will have adequate resources
67-14    available at the times required to provide for the payment of the
67-15    unrefunded part of the outstanding issue when due.  (V.A.C.S.
67-16    Art. 717k-3, Sec. 5 (part).)
67-17          Sec. 1207.083.  OTHER POWERS OF ISSUER.  To the extent
67-18    necessary or convenient in carrying out a power under this
67-19    subchapter, an issuer may use the provisions of any other law that
67-20    does not conflict with this subchapter.  (V.A.C.S. Art. 717k-3,
67-21    Sec. 7 (part).)
67-22          Sec. 1207.084.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS.
67-23    When bonds are being issued to be exchanged under this subchapter,
67-24    to the extent of a conflict or inconsistency between this
67-25    subchapter and another law, this subchapter controls.  (V.A.C.S.
67-26    Art. 717k-3, Sec. 7 (part).)
67-27                (Chapters 1208-1230 reserved for expansion)
 68-1             SUBTITLE B.  PROVISIONS APPLICABLE TO SECURITIES
 68-2                        ISSUED BY STATE GOVERNMENT
 68-3                     CHAPTER 1231.  BOND REVIEW BOARD 
 68-4                    SUBCHAPTER A.  GENERAL PROVISIONS 
 68-5    Sec. 1231.001.  DEFINITIONS
 68-6    Sec. 1231.002.  CERTAIN RIGHTS OF ISSUERS NOT AFFECTED
 68-7            (Sections 1231.003-1231.020 reserved for expansion)
 68-8                     SUBCHAPTER B.  BOND REVIEW BOARD
 68-9    Sec. 1231.021.  BOND REVIEW BOARD; PRESIDING OFFICER
68-10    Sec. 1231.022.  RULES
68-11            (Sections 1231.023-1231.040 reserved for expansion)
68-12        SUBCHAPTER C.  BOARD APPROVAL OF ISSUANCE OF STATE SECURITY
68-13    Sec. 1231.041.  APPROVAL OF STATE SECURITY
68-14    Sec. 1231.042.  APPLICATION FOR APPROVAL OF ISSUANCE OF
68-15                      STATE SECURITY
68-16    Sec. 1231.043.  APPROVAL OF ISSUANCE
68-17    Sec. 1231.044.  STATE AUDITOR REVIEW OF STATE SECURITY
68-18                      PROCEEDS; REPORT
68-19           (Sections 1231.045-1231.060 reserved for expansion) 
68-20                  SUBCHAPTER D.  REPORTS TO LEGISLATURE 
68-21    Sec. 1231.061.  REVIEW OF CERTAIN UNISSUED STATE SECURITIES;
68-22                      BIENNIAL REPORT TO LEGISLATURE
68-23    Sec. 1231.062.  BIENNIAL DEBT STATISTICS REPORT
68-24            (Sections 1231.063-1231.080 reserved for expansion)
68-25                SUBCHAPTER E.  SECURITY TRANSACTION REPORTS
68-26    Sec. 1231.081.  GENERAL REQUIREMENTS
68-27    Sec. 1231.082.  REPORT OF STATE SECURITY SOLD COMPETITIVELY
 69-1    Sec. 1231.083.  REPORT OF STATE SECURITY SOLD THROUGH
 69-2                      NEGOTIATION
 69-3    Sec. 1231.084.  REPORT OF STATE SECURITY SOLD THROUGH
 69-4                      PRIVATE PLACEMENT
 69-5    Sec. 1231.085.  REPORT OF REFUNDING OR ESCROW-RELATED
 69-6                      TRANSACTION
 69-7    Sec. 1231.086.  ANNUAL BOARD REPORTS
 69-8            (Sections 1231.087-1231.100 reserved for expansion)
 69-9                    SUBCHAPTER F.  BOND FINANCE OFFICE
69-10    Sec. 1231.101.  BOND FINANCE OFFICE
69-11    Sec. 1231.102.  ANNUAL REPORT
69-12    Sec. 1231.103.  PROVISION OF INFORMATION RELATING TO OTHER
69-13                      BONDS
69-14                     CHAPTER 1231.  BOND REVIEW BOARD
69-15                     SUBCHAPTER A.  GENERAL PROVISIONS
69-16          Sec. 1231.001.  DEFINITIONS.  In this chapter:
69-17                (1)  "Board" means the Bond Review Board.
69-18                (2)  "State security" means:
69-19                      (A)  an obligation, including a bond, issued by:
69-20                            (i)  a state agency;
69-21                            (ii)  an entity that is expressly created
69-22    by statute and has statewide jurisdiction; or
69-23                            (iii)  an entity issuing the obligation on
69-24    behalf of this state or on behalf of an entity described by
69-25    Subparagraph (i) or (ii); or
69-26                      (B)  an installment sale or lease-purchase
69-27    obligation that is issued by or on behalf of an entity described by
 70-1    Paragraph (A) and that has:
 70-2                            (i)  a stated term of more than five years;
 70-3    or
 70-4                            (ii)  an initial principal amount of more
 70-5    than $250,000.  (V.A.C.S.  Art. 717k-7, Secs. 1(1), (3).)
 70-6          Sec. 1231.002.  CERTAIN RIGHTS OF ISSUERS NOT AFFECTED.  This
 70-7    chapter does not affect the right of an issuer of state securities
 70-8    to select its own bond counsel, underwriter, financial advisor, or
 70-9    other service provider in connection with the issuance of state
70-10    securities.  (V.A.C.S.  Art. 717k-7, Sec. 7(b).)
70-11            (Sections 1231.003-1231.020 reserved for expansion)
70-12                     SUBCHAPTER B.  BOND REVIEW BOARD
70-13          Sec. 1231.021.  BOND REVIEW BOARD; PRESIDING OFFICER.  (a)
70-14    The board is composed of:
70-15                (1)  the governor;
70-16                (2)  the lieutenant governor;
70-17                (3)  the speaker of the house of representatives; and
70-18                (4)  the comptroller.
70-19          (b)  The governor is the presiding officer of the board.
70-20          (c)  A member of the board may designate another person to
70-21    act on the member's behalf.
70-22          (d)  If the speaker of the house of representatives is not
70-23    permitted by the constitution of this state from serving as a
70-24    voting member, the speaker serves as a nonvoting member.  (V.A.C.S.
70-25    Art. 601d-1, Secs. 2(a), (b), (c); Art. 717k-7, Sec. 2.)
70-26          Sec. 1231.022.  RULES.  The board may adopt rules:
70-27                (1)  relating to applications for review, the review
 71-1    process, and reporting requirements;
 71-2                (2)  exempting certain state securities from the
 71-3    application of Subchapter C if the board finds that review of the
 71-4    securities is unnecessary or impractical; and
 71-5                (3)  delegating to the director of the bond finance
 71-6    office the authority to approve a state security on behalf of the
 71-7    board.  (V.A.C.S. Art. 601d-1, Sec. 2(e); Art. 717k-7, Secs. 3(c),
 71-8    (d), (e).)
 71-9            (Sections 1231.023-1231.040 reserved for expansion)
71-10        SUBCHAPTER C.  BOARD APPROVAL OF ISSUANCE OF STATE SECURITY
71-11          Sec. 1231.041.  APPROVAL OF STATE SECURITY.  An entity,
71-12    including a state agency, may not issue a state security unless:
71-13                (1)  the board approves the issuance; or
71-14                (2)  the security is exempted under Section
71-15    1231.022(2).  (V.A.C.S. Art. 717k-7, Sec. 3(a) (part).)
71-16          Sec. 1231.042.  APPLICATION FOR APPROVAL OF ISSUANCE OF STATE
71-17    SECURITY.  To obtain the approval of the board to issue a state
71-18    security, a state agency or other entity must:
71-19                (1)  apply to the board, in the manner prescribed by
71-20    the board; and
71-21                (2)  file with the application any information,
71-22    including documents, required by the board.  (V.A.C.S. Art. 717k-7,
71-23    Sec. 3(a) (part).)
71-24          Sec. 1231.043.  APPROVAL OF ISSUANCE.  The board shall
71-25    approve the issuance of a state security if, after examining the
71-26    application and documents or items of information required by the
71-27    board, the board determines that the issuance is advisable.
 72-1    (V.A.C.S. Art. 717k-7, Sec. 3(b).)
 72-2          Sec. 1231.044.  STATE AUDITOR REVIEW OF STATE SECURITY
 72-3    PROCEEDS; REPORT.  (a)  On the board's request, the state auditor
 72-4    shall review the disposition of state security proceeds.
 72-5          (b)  The state auditor shall prepare a report of the review
 72-6    and file a copy of the report with:
 72-7                (1)  the governor;
 72-8                (2)  the lieutenant governor;
 72-9                (3)  the speaker of the house of representatives;
72-10                (4)  the secretary of state; and
72-11                (5)  each member of the legislature.  (V.A.C.S.
72-12    Art. 717k-7, Sec. 6.)
72-13            (Sections 1231.045-1231.060 reserved for expansion)
72-14                   SUBCHAPTER D.  REPORTS TO LEGISLATURE
72-15          Sec. 1231.061.  REVIEW OF CERTAIN UNISSUED STATE SECURITIES;
72-16    BIENNIAL REPORT TO LEGISLATURE.  (a)  The board shall review all
72-17    state securities, including general obligation and revenue bonds,
72-18    that have been authorized but are unissued.
72-19          (b)  Not later than October 31 of each even-numbered year,
72-20    the board shall submit to the legislature a report that recommends
72-21    whether the authorization for a state security shall be revoked.
72-22    (V.A.C.S. Art. 717k-7, Sec.  7C, as added Acts 74th Leg., R.S., Ch.
72-23    376.)
72-24          Sec. 1231.062.  BIENNIAL DEBT STATISTICS REPORT.  (a)  Not
72-25    later than October 31 of each even-numbered year, the board shall
72-26    submit to the legislature a statistical report relating to:
72-27                (1)  state securities; and
 73-1                (2)  bonds and other debt obligations issued by local
 73-2    governments.
 73-3          (b)  A report must include:
 73-4                (1)  total debt service as a percentage of total
 73-5    expenditures;
 73-6                (2)  tax-supported debt service as a percentage of
 73-7    general revenue expenditure;
 73-8                (3)  per capita total debt;
 73-9                (4)  per capita tax-supported debt;
73-10                (5)  total debt and tax-supported debt as a percentage
73-11    of personal income;
73-12                (6)  total personal income per capita;
73-13                (7)  total debt per capita as a percentage of total
73-14    personal income per capita;
73-15                (8)  total debt and tax-supported debt as a percentage
73-16    of real property valuations;
73-17                (9)  total debt and tax-supported debt as a percentage
73-18    of annual revenues and expenditures;
73-19                (10)  principal required to be repaid in five years and
73-20    principal required to be repaid in 10 years;
73-21                (11)  growth rates of total debt per capita and total
73-22    debt per dollar of personal income;
73-23                (12)  recent trends in the issuance of short-term
73-24    notes;
73-25                (13)  recent trends in issuance costs;
73-26                (14)  savings from recent refundings;
73-27                (15)  recent trends in capitalized interest use;
 74-1                (16)  debt service coverage ratios, if applicable; and
 74-2                (17)  other information the board considers relevant.
 74-3          (c)  The attorney general, each state agency, and each local
 74-4    government shall provide to the board, at the times required by the
 74-5    board, information that the board determines to be necessary to
 74-6    prepare the statistical report.  (V.A.C.S. Art. 717k-7, Sec. 7A.)
 74-7            (Sections 1231.063-1231.080 reserved for expansion)
 74-8                SUBCHAPTER E.  SECURITY TRANSACTION REPORTS
 74-9          Sec. 1231.081.  GENERAL REQUIREMENTS.  (a)  Each entity that
74-10    issues a state security shall report to the board its security
74-11    transactions.
74-12          (b)  A report must:
74-13                (1)  be itemized;
74-14                (2)  state in dollars the information required by
74-15    Subsection (c) or Sections 1231.082-1231.085 for money paid to each
74-16    business and classify each of the businesses that money was paid to
74-17    according to:
74-18                      (A)  the race, ethnicity, and gender of the
74-19    controlling ownership of each business; and
74-20                      (B)  whether the business is domestic or foreign;
74-21    and
74-22                (3)  be made in compliance with board rule.
74-23          (c)  For any security transaction, the report must state each
74-24    issuance cost, including the cost of:
74-25                (1)  bond counsel;
74-26                (2)  financial advisor;
74-27                (3)  rating agencies;
 75-1                (4)  official statement preparation;
 75-2                (5)  official statement printing;
 75-3                (6)  bond printing;
 75-4                (7)  paying agent or registrar;
 75-5                (8)  escrow agent;
 75-6                (9)  escrow verification agent;
 75-7                (10)  trustee;
 75-8                (11)  attorney general;
 75-9                (12)  dealer fee;
75-10                (13)  remarketing fee; and
75-11                (14)  credit enhancement.  (V.A.C.S. Art. 717k-7, Secs.
75-12    7C(a), (b), (c), (d), as added Acts 74th Leg., R.S., Ch. 745.)
75-13          Sec. 1231.082.  REPORT OF STATE SECURITY SOLD COMPETITIVELY.
75-14    A report concerning a state security that is sold competitively
75-15    must state:
75-16                (1)  the components of the gross spread, including:
75-17                      (A)  gross takedown;
75-18                      (B)  expenses; and
75-19                      (C)  syndicate profit and loss;
75-20                (2)  a summary of obligation orders and allotments by
75-21    maturity, firm, and order type; and
75-22                (3)  each syndicate firm's gross takedown and share of
75-23    syndicate profit or loss.  (V.A.C.S. Art. 717k-7, Sec. 7C(e), as
75-24    added Acts 74th Leg., R.S., Ch. 745.)
75-25          Sec. 1231.083.  REPORT OF STATE SECURITY SOLD THROUGH
75-26    NEGOTIATION.  A report concerning a state security sold through
75-27    negotiation must state:
 76-1                (1)  the components of the spread, including:
 76-2                      (A)  management fee;
 76-3                      (B)  structuring fee;
 76-4                      (C)  underwriting risk;
 76-5                      (D)  takedown; and
 76-6                      (E)  spread expenses;
 76-7                (2)  each firm's share of underwriting risk;
 76-8                (3)  the underwriter's counsel;
 76-9                (4)  a summary of obligation orders and allotments by
76-10    maturity, firm, and order type; and
76-11                (5)  each syndicate firm's share of management fee,
76-12    structuring fee, underwriting risk fee, and takedown.  (V.A.C.S.
76-13    Art. 717k-7, Sec. 7C(f), as added Acts 74th Leg., R.S., Ch. 745.)
76-14          Sec. 1231.084.  REPORT OF STATE SECURITY SOLD THROUGH PRIVATE
76-15    PLACEMENT.  A report concerning a state security sold through
76-16    private placement must state:
76-17                (1)  each component of the private placement fee,
76-18    including the:
76-19                      (A)  management fee;
76-20                      (B)  placement agent fee; and
76-21                      (C)  expenses; and
76-22                (2)  the placement agent's counsel's fee.  (V.A.C.S.
76-23    Art. 717k-7, Sec.  7C(g), as added Acts 74th Leg., R.S., Ch. 745.)
76-24          Sec. 1231.085.  REPORT OF REFUNDING OR ESCROW-RELATED
76-25    TRANSACTION.  A report concerning a refunding or escrow-related
76-26    transaction must state the spread paid on the purchase or sale of
76-27    an escrow security.  (V.A.C.S. Art. 717k-7, Sec. 7C(h), as added
 77-1    Acts 74th Leg., R.S., Ch. 745.)
 77-2          Sec. 1231.086.  ANNUAL BOARD REPORTS.  (a)  On May 15 of each
 77-3    year, the board shall send to the joint committee charged with
 77-4    monitoring the implementation of goals for participation by
 77-5    historically underutilized businesses a report of the information
 77-6    received under this subchapter for the six months preceding March 1
 77-7    of that year.
 77-8          (b)  On November 15 of each year, the board shall send to the
 77-9    lieutenant governor, the speaker of the house, each member of the
77-10    legislature, and the joint committee a report of the information
77-11    received under this subchapter for the fiscal year ending August 31
77-12    of that year.  (V.A.C.S. Art. 717k-7, Secs.  7C(i), (j), as added
77-13    Acts 74th Leg., R.S., Ch. 745.)
77-14            (Sections 1231.087-1231.100 reserved for expansion)
77-15                    SUBCHAPTER F.  BOND FINANCE OFFICE
77-16          Sec. 1231.101.  BOND FINANCE OFFICE.  (a)  The board shall
77-17    appoint a director to:
77-18                (1)  manage the bond finance office; and
77-19                (2)  select the staff of the office.
77-20          (b)  When practical, the office shall make use of:
77-21                (1)  the resources of the Legislative Budget Board; and
77-22                (2)  the offices of the governor and the comptroller.
77-23    (V.A.C.S.  Art. 717k-7, Sec. 4.)
77-24          Sec. 1231.102.  ANNUAL REPORT.  Not later than the 90th day
77-25    after the end of each state fiscal year, the bond finance office
77-26    shall publish a report listing:
77-27                (1)  the amount of state securities outstanding;
 78-1                (2)  applicable repayment schedules; and
 78-2                (3)  other information the office considers relevant.
 78-3    (V.A.C.S.  Art. 717k-7, Sec. 5.)
 78-4          Sec. 1231.103.  PROVISION OF INFORMATION RELATING TO OTHER
 78-5    BONDS.  The bond finance office may provide information for
 78-6    inclusion in a prospectus related to any bond issued under
 78-7    authority of state law or municipal ordinance.  (V.A.C.S.
 78-8    Art. 717k-7, Sec. 7(a).)
 78-9               CHAPTER 1232.  TEXAS PUBLIC FINANCE AUTHORITY
78-10                     SUBCHAPTER A.  GENERAL PROVISIONS
78-11    Sec. 1232.001.  SHORT TITLE
78-12    Sec. 1232.002.  PURPOSE
78-13    Sec. 1232.003.  DEFINITIONS
78-14    Sec. 1232.004.  STATE LEASE FUND ACCOUNT
78-15    Sec. 1232.005.  APPLICATION OF STATE FUNDS REFORM ACT
78-16            (Sections 1232.006-1232.050 reserved for expansion)
78-17               SUBCHAPTER B.  TEXAS PUBLIC FINANCE AUTHORITY
78-18    Sec. 1232.051.  TEXAS PUBLIC FINANCE AUTHORITY
78-19    Sec. 1232.052.  COMPOSITION OF GOVERNING BOARD
78-20    Sec. 1232.053.  TERMS
78-21    Sec. 1232.054.  GROUNDS FOR REMOVAL
78-22    Sec. 1232.055.  BOARD MEMBER TRAINING
78-23    Sec. 1232.056.  OFFICERS; MEETINGS
78-24    Sec. 1232.057.  PUBLIC TESTIMONY AT BOARD MEETINGS
78-25    Sec. 1232.058.  COMPENSATION AND EXPENSES
78-26    Sec. 1232.059.  STAFF; CONSULTANTS
78-27    Sec. 1232.060.  CONFLICT OF INTEREST
 79-1    Sec. 1232.061.  INFORMATION ON RESPONSIBILITIES OF BOARD
 79-2                      MEMBERS AND EMPLOYEES
 79-3    Sec. 1232.062.  SEPARATION OF POLICYMAKING AND MANAGEMENT
 79-4                      RESPONSIBILITIES
 79-5    Sec. 1232.063.  EQUAL EMPLOYMENT OPPORTUNITY
 79-6    Sec. 1232.064.  CAREER LADDER; EMPLOYEE PERFORMANCE
 79-7                      EVALUATIONS
 79-8    Sec. 1232.065.  COMPLIANCE WITH LAWS RELATING TO
 79-9                      ACCESSIBILITY
79-10    Sec. 1232.066.  BOARD AUTHORITY
79-11    Sec. 1232.067.  GENERAL POWERS
79-12    Sec. 1232.068.  EMINENT DOMAIN
79-13    Sec. 1232.069.  ANNUAL FINANCIAL REPORT
79-14    Sec. 1232.070.  INFORMATION ON COMPLAINTS
79-15    Sec. 1232.071.  RELATIONSHIP TO PREVIOUS BOARD
79-16    Sec. 1232.072.  SUNSET PROVISION
79-17            (Sections 1232.073-1232.100 reserved for expansion)
79-18                        SUBCHAPTER C.  OBLIGATIONS
79-19    Sec. 1232.101.  ISSUANCE OF BONDS FOR CERTAIN STATE AGENCIES
79-20    Sec. 1232.102.  ISSUANCE OF BONDS FOR STATE OFFICE BUILDINGS
79-21    Sec. 1232.103.  ISSUANCE OF OBLIGATIONS FOR EQUIPMENT
79-22    Sec. 1232.104.  ISSUANCE OF OBLIGATIONS FOR ALTERNATIVE FUEL
79-23                      PROJECTS
79-24    Sec. 1232.105.  AGGREGATE LIMIT ON ISSUANCE OF OBLIGATIONS FOR
79-25                      ALTERNATIVE FUEL PROJECTS
79-26    Sec. 1232.106.  EVALUATION OF APPLICATION FOR ASSISTANCE WITH
79-27                      ALTERNATIVE FUEL PROJECTS
 80-1    Sec. 1232.107.  PURCHASE OF OBLIGATIONS FOR ALTERNATIVE FUEL
 80-2                      PROJECTS
 80-3    Sec. 1232.108.  LEGISLATIVE AUTHORIZATION REQUIRED
 80-4    Sec. 1232.109.  AUTHORIZATION TO PURCHASE CERTAIN REAL
 80-5                      PROPERTY
 80-6    Sec. 1232.110.  SPECIFIC PROJECTS IN TRAVIS COUNTY
 80-7    Sec. 1232.111.  SPECIFIC PROJECTS OUTSIDE TRAVIS COUNTY
 80-8    Sec. 1232.112.  BOND REVIEW BOARD APPROVAL
 80-9    Sec. 1232.113.  OBLIGATION ISSUANCE ORIENTATION; INFORMATION TO
80-10                      AND FROM CLIENT AGENCIES
80-11    Sec. 1232.114.  PROJECT ANALYSIS
80-12    Sec. 1232.115.  EXPENSES INCLUDED IN PRINCIPAL AMOUNT
80-13    Sec. 1232.116.  MANNER OF REPAYMENT
80-14    Sec. 1232.117.  STATE DEBT NOT CREATED
80-15    Sec. 1232.118.  ORDER OR RESOLUTION AUTHORIZING ISSUANCE OF
80-16                      OBLIGATIONS
80-17    Sec. 1232.119.  ADOPTION AND EXECUTION OF INSTRUMENTS
80-18    Sec. 1232.120.  EXEMPTION FROM TAXATION
80-19    Sec. 1232.121.  CERTIFICATION AND DEPOSIT OF PROCEEDS OF
80-20                      OBLIGATIONS
80-21    Sec. 1232.122.  COMMENCEMENT OF CONSTRUCTION, PURCHASE, OR
80-22                      LEASE
80-23    Sec. 1232.123.  INVESTMENT OF BOND PROCEEDS
80-24            (Sections 1232.124-1232.200 reserved for expansion)
80-25       SUBCHAPTER D.  LEASE AND CONVEYANCE OF PROPERTY BY AUTHORITY
80-26    Sec. 1232.201.  RENT AND FEES
80-27    Sec. 1232.202.  CONTRACTS CONTINGENT ON LEGISLATIVE
 81-1                      APPROPRIATIONS
 81-2    Sec. 1232.203.  LEASE OF SPACE TO CHILD CARE DEVELOPMENT
 81-3                      BOARD
 81-4    Sec. 1232.204.  LEASING PREFERENCE
 81-5    Sec. 1232.205.  LEASE OF SPACE TO OUTSIDE ENTITIES
 81-6    Sec. 1232.206.  PROPERTY CONVEYANCE
 81-7               CHAPTER 1232.  TEXAS PUBLIC FINANCE AUTHORITY
 81-8                     SUBCHAPTER A.  GENERAL PROVISIONS
 81-9          Sec. 1232.001.  SHORT TITLE.  This chapter may be cited as
81-10    the Texas Public Finance Authority Act. (V.A.C.S.  Art. 601d, Sec.
81-11    1.)
81-12          Sec. 1232.002.  PURPOSE.  The purpose of this chapter is to
81-13    provide a method of financing for:
81-14                (1)  the acquisition or construction of buildings in
81-15    Travis County; and
81-16                (2)  the purchase or lease of equipment by executive or
81-17    judicial branch state agencies.  (V.A.C.S. Art. 601d, Sec. 2.)
81-18          Sec. 1232.003.  DEFINITIONS.  In this chapter:
81-19                (1)  "Authority" means the Texas Public Finance
81-20    Authority.
81-21                (2)  "Board" means the board of directors of the
81-22    authority.
81-23                (3)  "Building" means:
81-24                      (A)  a structure used by a state agency to
81-25    conduct state business; and
81-26                      (B)  the major equipment or personal property
81-27    related functionally to a structure used by a state agency to
 82-1    conduct state business.
 82-2                (4)  "Commission" means the General Services
 82-3    Commission.
 82-4                (5)  "Computer equipment" means a telecommunications
 82-5    device or system, an automated information system, a computer on
 82-6    which an information system is automated, and computer software.
 82-7                (6)  "Construction" means the erection, improvement,
 82-8    repair, renovation, or remodeling of a building.
 82-9                (7)  "Equipment" means a fixed asset, other than land
82-10    or a building, used by a state agency to conduct state business.
82-11    The term includes computer equipment.
82-12                (8)  "Obligation" means a bond, note, certificate of
82-13    participation, certificate of obligation, or interest in a
82-14    contract.
82-15                (9)  "State agency" means a board, commission,
82-16    department, office, agency, institution of higher education, or
82-17    other governmental entity in the executive, judicial, or
82-18    legislative branch of state government.  (V.A.C.S. Art. 601d, Sec.
82-19    1A.)
82-20          Sec. 1232.004.  STATE LEASE FUND ACCOUNT.  (a)  The state
82-21    lease fund account is an account in the general revenue fund and
82-22    may be used only for a purpose designated by law.
82-23          (b)  The state lease fund account may be used to finance an
82-24    appropriation to the commission or a state agency or directly to
82-25    the authority on behalf of a state agency to pay required rents,
82-26    fees, and installments to the authority.
82-27          (c)  After all obligations have been paid or provided for,
 83-1    the legislature may transfer money deposited in the state lease
 83-2    fund account to the Texas capital trust fund account for other
 83-3    purposes.
 83-4          (d)  The amount in the state lease fund account that is in
 83-5    excess of amounts needed for debt service and is unencumbered shall
 83-6    be transferred at the end of each biennium to the undedicated
 83-7    portion of the general revenue fund.  (V.A.C.S. Art. 601d, Sec. 26;
 83-8    Acts 74th Leg., R.S., Ch. 1058, Sec. 3 (part).)
 83-9          Sec. 1232.005.  APPLICATION OF STATE FUNDS REFORM ACT.  All
83-10    money paid to the authority under this chapter is subject to
83-11    Subchapter F, Chapter 404.  (V.A.C.S. Art. 601d, Sec. 26A.)
83-12            (Sections 1232.006-1232.050 reserved for expansion)
83-13               SUBCHAPTER B.  TEXAS PUBLIC FINANCE AUTHORITY
83-14          Sec. 1232.051.  TEXAS PUBLIC FINANCE AUTHORITY.  The Texas
83-15    Public Finance Authority is a public authority and a body politic
83-16    and corporate.  (V.A.C.S. Art. 601d, Sec. 3.)
83-17          Sec. 1232.052.  COMPOSITION OF GOVERNING BOARD.  (a)  The
83-18    authority is governed by a board of directors composed of six
83-19    members appointed by the governor with the advice and consent of
83-20    the senate.
83-21          (b)  A person is not eligible for appointment as a member of
83-22    the board if the person or the person's spouse:
83-23                (1)  is employed by or participates in the management
83-24    of a business entity or other organization receiving funds from the
83-25    authority;
83-26                (2)  owns or controls, directly or indirectly, more
83-27    than a 10 percent interest in a business entity or other
 84-1    organization receiving funds from the authority; or
 84-2                (3)  uses or receives a substantial amount of tangible
 84-3    goods, services, or funds from the authority, other than
 84-4    compensation or reimbursement authorized by law for board
 84-5    membership, attendance, or expenses.
 84-6          (c)  Appointments to the board shall be made without regard
 84-7    to the race, color, disability, sex, religion, age, or national
 84-8    origin of the appointees.  (V.A.C.S. Art. 601d, Sec. 4.)
 84-9          Sec. 1232.053.  TERMS.  Members of the board are appointed
84-10    for staggered terms of six years, with two members' terms expiring
84-11    February 1 of each odd-numbered year.  (V.A.C.S. Art. 601d, Sec.
84-12    5.)
84-13          Sec. 1232.054.  GROUNDS FOR REMOVAL.  (a)  It is a ground for
84-14    removal from the board that a member:
84-15                (1)  violates a prohibition established by Section
84-16    1232.060;
84-17                (2)  cannot because of illness or disability discharge
84-18    the member's duties for a substantial part of the term for which
84-19    the member is appointed; or
84-20                (3)  is absent from more than half of the regularly
84-21    scheduled board meetings that the member is eligible to attend
84-22    during a calendar year unless the absence is excused by majority
84-23    vote of the board.
84-24          (b)  The validity of an action of the board is not affected
84-25    by the fact that it is taken when a ground for removal of a board
84-26    member exists.
84-27          (c)  If the executive director of the authority has knowledge
 85-1    that a potential ground for removal exists, the executive director
 85-2    shall notify the presiding officer of the board of the potential
 85-3    ground.  The presiding officer shall then notify the governor and
 85-4    the attorney general that a potential ground for removal exists.
 85-5    If the potential ground for removal involves the presiding officer,
 85-6    the executive director shall notify the assistant presiding
 85-7    officer, who shall notify the governor and the attorney general
 85-8    that a potential ground for removal exists.  (V.A.C.S. Art. 601d,
 85-9    Sec. 5A.)
85-10          Sec. 1232.055.  BOARD MEMBER TRAINING.  (a)  To be eligible
85-11    to take office as a member of the board, a person appointed to the
85-12    board must complete at least one course of a training program that
85-13    complies with this section.
85-14          (b)  The training program must provide information to the
85-15    person regarding:
85-16                (1)  the enabling legislation that created the
85-17    authority and the board;
85-18                (2)  the programs operated by the authority;
85-19                (3)  the role and functions of the authority;
85-20                (4)  the rules of the authority, with an emphasis on
85-21    the rules that relate to disciplinary and investigatory authority;
85-22                (5)  the current budget for the authority;
85-23                (6)  the results of the most recent formal audit of the
85-24    authority;
85-25                (7)  the requirements of the:
85-26                      (A)  open meetings law, Chapter 551;
85-27                      (B)  public information law, Chapter 552; and
 86-1                      (C)  administrative procedure law, Chapter 2001;
 86-2                (8)  the requirements of the conflict of interest laws
 86-3    and other laws relating to public officials; and
 86-4                (9)  any applicable ethics policies adopted by the
 86-5    authority or the Texas Ethics Commission.
 86-6          (c)  A person appointed to the board is entitled to
 86-7    reimbursement for travel expenses incurred in attending the
 86-8    training program, as provided by the General Appropriations Act and
 86-9    as if the person were a member of the board.  (V.A.C.S. Art. 601d,
86-10    Sec. 5B.)
86-11          Sec. 1232.056.  OFFICERS; MEETINGS.  (a)  The governor shall
86-12    designate a member of the board as the presiding officer to serve
86-13    in that capacity at the pleasure of the governor.  The board
86-14    biennially shall elect an assistant presiding officer from its
86-15    members.
86-16          (b)  The board shall meet at least once in each calendar
86-17    quarter and shall meet at other times at the call of the presiding
86-18    officer or as prescribed by board rule.  (V.A.C.S. Art. 601d, Secs.
86-19    6(a), (c).)
86-20          Sec. 1232.057.  PUBLIC TESTIMONY AT BOARD MEETINGS.  The
86-21    board shall develop and implement policies that provide the public
86-22    with a reasonable opportunity to appear before the board and to
86-23    speak on any issue under the jurisdiction of the authority.
86-24    (V.A.C.S. Art. 601d, Sec. 6A.)
86-25          Sec. 1232.058.  COMPENSATION AND EXPENSES.  A board member is
86-26    entitled to:
86-27                (1)  a per diem of $50, unless otherwise specified in
 87-1    the General Appropriations Act, for each day the member performs
 87-2    functions as a board member; and
 87-3                (2)  reimbursement for actual and necessary expenses
 87-4    that the member incurs in performing board functions.  (V.A.C.S.
 87-5    Art. 601d, Sec. 7.)
 87-6          Sec. 1232.059.  STAFF; CONSULTANTS.  (a)  The board shall
 87-7    employ persons and contract with consultants necessary for the
 87-8    board to perform its functions.
 87-9          (b)  Employees of the authority are considered to be state
87-10    employees.  (V.A.C.S. Art. 601d, Sec. 8.)
87-11          Sec. 1232.060.  CONFLICT OF INTEREST.  (a)  An officer,
87-12    employee, or paid consultant of a Texas trade association in the
87-13    field of public finance may not be a member of the board or an
87-14    employee of the authority who is exempt from the state's position
87-15    classification plan or is compensated at or above the amount
87-16    prescribed by the General Appropriations Act for step 1, salary
87-17    group A17, of the position classification salary schedule.
87-18          (b)  A person who is the spouse of an officer, manager, or
87-19    paid consultant of a Texas trade association in the field of public
87-20    finance may not be a member of the board and may not be an employee
87-21    of the authority who is exempt from the state's position
87-22    classification plan or is compensated at or above the amount
87-23    prescribed by the General Appropriations Act for step 1, salary
87-24    group A17, of the position classification salary schedule.
87-25          (c)  For the purposes of this section, a Texas trade
87-26    association is a nonprofit, cooperative, and voluntarily joined
87-27    association of business or professional competitors in this state
 88-1    designed to assist its members and its industry or profession in
 88-2    dealing with mutual business or professional problems and in
 88-3    promoting their common interest.
 88-4          (d)  A person may not serve as a member of the board or act
 88-5    as the general counsel to the board or the authority if the person
 88-6    is required to register as a lobbyist under Chapter 305 because of
 88-7    the person's activities for compensation on behalf of a profession
 88-8    related to the operation of the authority.  (V.A.C.S. Art. 601d,
 88-9    Sec. 8A.)
88-10          Sec. 1232.061.  INFORMATION ON RESPONSIBILITIES OF BOARD
88-11    MEMBERS AND EMPLOYEES.  The executive director of the authority or
88-12    the executive director's designee shall provide to members of the
88-13    board and to authority employees, as often as necessary,
88-14    information regarding their qualification for office or employment
88-15    under this chapter and their responsibilities under applicable laws
88-16    relating to standards of conduct for state officers or employees.
88-17    (V.A.C.S. Art. 601d, Sec. 8B.)
88-18          Sec. 1232.062.  SEPARATION OF POLICYMAKING AND MANAGEMENT
88-19    RESPONSIBILITIES.  The board shall develop and implement policies
88-20    that clearly separate the policymaking responsibilities of the
88-21    board and the management responsibilities of the executive director
88-22    and the staff of the authority.  (V.A.C.S. Art. 601d, Sec. 8C.)
88-23          Sec. 1232.063.  EQUAL EMPLOYMENT OPPORTUNITY.  (a)  The
88-24    executive director of the authority or the executive director's
88-25    designee shall prepare and maintain a written policy statement to
88-26    assure implementation of a program of equal employment opportunity
88-27    under which all personnel transactions are made without regard to
 89-1    race, color, disability, sex, religion, age, or national origin.
 89-2    The policy statement must include:
 89-3                (1)  personnel policies, including policies relating to
 89-4    recruitment, evaluation, selection, appointment, training, and
 89-5    promotion of personnel that are in compliance with requirements of
 89-6    Chapter 21, Labor Code;
 89-7                (2)  a comprehensive analysis of the authority
 89-8    workforce that meets federal and state guidelines;
 89-9                (3)  procedures by which a determination can be made
89-10    about the extent of underuse in the authority workforce of all
89-11    persons for whom federal or state guidelines encourage a more
89-12    equitable balance; and
89-13                (4)  reasonable methods to appropriately address those
89-14    areas of underuse.
89-15          (b)  A policy statement prepared under Subsection (a) must
89-16    cover an annual period, be updated annually and reviewed by the
89-17    Commission on Human Rights for compliance with Subsection (a)(1),
89-18    and be filed with the governor's office.
89-19          (c)  The governor's office shall deliver a biennial report to
89-20    the legislature based on the information received under Subsection
89-21    (b).  The report may be made separately or as a part of other
89-22    biennial reports made to the legislature.  (V.A.C.S. Art. 601d,
89-23    Sec. 8D.)
89-24          Sec. 1232.064.  CAREER LADDER; EMPLOYEE PERFORMANCE
89-25    EVALUATIONS.  (a)  The executive director of the authority or the
89-26    executive director's designee shall develop an intra-agency career
89-27    ladder program that addresses opportunities for mobility and
 90-1    advancement for employees within the authority.  The program shall
 90-2    require intra-agency posting of all positions concurrently with any
 90-3    public posting.
 90-4          (b)  The executive director of the authority or the executive
 90-5    director's designee shall develop a system of annual performance
 90-6    evaluations that are based on documented employee performance.  All
 90-7    merit pay for authority employees must be based on the system
 90-8    established under this subsection.  (V.A.C.S. Art. 601d, Sec. 8E.)
 90-9          Sec. 1232.065.  COMPLIANCE WITH LAWS RELATING TO
90-10    ACCESSIBILITY.  The authority shall comply with federal and state
90-11    laws related to program and facility accessibility.  (V.A.C.S.
90-12    Art. 601d, Sec. 8F.)
90-13          Sec. 1232.066.  BOARD AUTHORITY.  (a)  The board's authority
90-14    under this chapter is limited to the financing of the acquisition
90-15    or construction of a building or the purchase or lease of
90-16    equipment.
90-17          (b)  The board's authority does not affect the authority of
90-18    the commission or any other state agency.
90-19          (c)  Buildings and equipment financed by the authority under
90-20    this chapter do not become part of other property to which they may
90-21    be attached or into which they may be incorporated, without regard
90-22    to whether the other property is real or personal.  (V.A.C.S.
90-23    Art. 601d, Sec. 11.)
90-24          Sec. 1232.067.  GENERAL POWERS.  The board may:
90-25                (1)  exercise, to the extent practicable, all powers
90-26    given to a corporation under the general laws of the state;
90-27                (2)  have perpetual succession by its corporate name;
 91-1                (3)  sue and be sued in its corporate name;
 91-2                (4)  adopt a seal for use as the board considers
 91-3    appropriate;
 91-4                (5)  accept gifts; and
 91-5                (6)  adopt rules and perform all functions reasonably
 91-6    necessary for the board to administer its functions prescribed by
 91-7    this chapter.  (V.A.C.S. Art. 601d, Sec. 21.)
 91-8          Sec. 1232.068.  EMINENT DOMAIN.  The authority may exercise
 91-9    the power of eminent domain for the purposes set forth in this
91-10    chapter in connection with the acquisition or construction of a
91-11    building that is authorized as provided by Section 1232.108.
91-12    (V.A.C.S. Art. 601d, Sec. 30.)
91-13          Sec. 1232.069.  ANNUAL FINANCIAL REPORT.  The board,
91-14    authority, or executive director of the authority shall prepare
91-15    annually a complete and detailed written report accounting for all
91-16    funds received and disbursed by the authority during the preceding
91-17    fiscal year.  The annual report must meet the reporting
91-18    requirements applicable to financial reporting provided in the
91-19    General Appropriations Act.  (V.A.C.S. Art. 601d, Sec. 26B.)
91-20          Sec. 1232.070.  INFORMATION ON COMPLAINTS.  (a)  The
91-21    authority shall keep a file about each written complaint filed with
91-22    the authority that the authority has authority to resolve.  The
91-23    authority shall provide to the person filing the complaint and the
91-24    persons complained about the authority's policies and procedures
91-25    relating to complaint investigation and resolution.  The authority,
91-26    at least quarterly and until final disposition of the complaint,
91-27    shall notify the person filing the complaint and the persons
 92-1    complained about of the status of the complaint unless the notice
 92-2    would jeopardize an undercover investigation.
 92-3          (b)  The authority shall keep information about each
 92-4    complaint filed with the authority.  The information must include:
 92-5                (1)  the date the complaint is received;
 92-6                (2)  the name of the complainant;
 92-7                (3)  the subject matter of the complaint;
 92-8                (4)  a record of all persons contacted in relation to
 92-9    the complaint;
92-10                (5)  a summary of the results of the review or
92-11    investigation of the complaint; and
92-12                (6)  for complaints for which the authority took no
92-13    action, an explanation of the reason the complaint was closed
92-14    without action.  (V.A.C.S. Art. 601d, Sec. 8G.)
92-15          Sec. 1232.071.  RELATIONSHIP TO PREVIOUS BOARD.  (a)  The
92-16    Texas Public Finance Authority owns the property formerly owned by,
92-17    and is the successor to each lease or rental contract entered into
92-18    by, the Texas Public Building Authority created by Chapter 700,
92-19    Acts of the 68th Legislature, Regular Session, 1983.
92-20          (b)  An obligation contracted or assumed by the Texas Public
92-21    Building Authority with respect to a property or contract described
92-22    by Subsection (a) is an obligation of the Texas Public Finance
92-23    Authority. (V.A.C.S. Art. 601d, Sec. 32 (part).)
92-24          Sec. 1232.072.  SUNSET PROVISION.  The Texas Public Finance
92-25    Authority is subject to Chapter 325 (Texas Sunset Act).  Unless
92-26    continued in existence as provided by that chapter, the authority
92-27    is abolished and this chapter expires September 1, 2009.  (V.A.C.S.
 93-1    Art. 601d, Sec. 31.)
 93-2            (Sections 1232.073-1232.100 reserved for expansion)
 93-3                        SUBCHAPTER C.  OBLIGATIONS
 93-4          Sec. 1232.101.  ISSUANCE OF BONDS FOR CERTAIN STATE AGENCIES.
 93-5    (a)  With respect to all bonds authorized to be issued by the Texas
 93-6    Military Facilities Commission, Texas National Research Laboratory
 93-7    Commission, Parks and Wildlife Department, Texas Low-Level
 93-8    Radioactive Waste Disposal Authority, and each institution of
 93-9    higher education authorized to issue bonds under Chapter 55,
93-10    Education Code, the authority has the exclusive authority to act on
93-11    behalf of those entities in issuing bonds on their behalf.  In
93-12    connection with those issuances and with the issuance of refunding
93-13    bonds on behalf of those entities, the authority is subject to all
93-14    rights, duties, and conditions surrounding issuance previously
93-15    applicable to the issuing entity under the statute authorizing the
93-16    issuance.  A reference in an authorizing statute to the entity on
93-17    whose behalf the bonds are being issued applies equally to the
93-18    authority in its capacity as issuer on behalf of the entity.
93-19          (b)  Subsection (a) does not apply to:
93-20                (1)  The University of Texas System, The Texas A&M
93-21    University System, or a component of those systems;
93-22                (2)  an institution of higher education authorized to
93-23    issue bonds under Section 17, Article VII, Texas Constitution; or
93-24                (3)  bonds authorized to be issued by a system,
93-25    component, or institution described by Subdivision (1) or (2).
93-26          (c)  Notwithstanding any other provision of this section,
93-27    with respect to all bonds authorized to be issued by Midwestern
 94-1    State University, Stephen F.  Austin State University, or Texas
 94-2    Southern University, the authority has the exclusive authority to
 94-3    act on behalf of those institutions in issuing bonds on their
 94-4    behalf.  In connection with those issuances and with the issuance
 94-5    of refunding bonds on behalf of those institutions, the authority
 94-6    is subject to all rights, duties, and conditions surrounding
 94-7    issuance previously applicable to the issuing institution under the
 94-8    statute authorizing the issuance.  All references in an authorizing
 94-9    statute to the institution on whose behalf the bonds are being
94-10    issued apply equally to the authority in its capacity as issuer on
94-11    behalf of the institution.  (V.A.C.S. Art. 601d, Sec. 9B.)
94-12          Sec. 1232.102.  ISSUANCE OF BONDS FOR STATE OFFICE BUILDINGS.
94-13    (a)  The board may issue and sell bonds in the name of the
94-14    authority to finance the acquisition or construction of buildings
94-15    in Travis County.  After receiving a request described by Section
94-16    2166.452, the board may issue bonds in amounts not exceeding the
94-17    previously authorized amount of bonds plus five percent of the
94-18    acquisition cost of the property, as described in the request.
94-19          (b)  The board shall promptly issue and sell bonds in the
94-20    name of the authority under this chapter to finance the acquisition
94-21    or construction of a building that has been authorized in
94-22    accordance with this chapter or under Section 2166.452 or 2166.453.
94-23          (c)  The commission or other state agency involved in
94-24    acquiring or constructing a building financed by bonds issued under
94-25    this chapter shall accomplish its statutory authority as if the
94-26    building were financed by legislative appropriation.  The board and
94-27    the commission or other state agency involved in the acquisition or
 95-1    construction of a building shall adopt a memorandum of
 95-2    understanding that defines the division of authority between the
 95-3    board and the commission or other agency.  (V.A.C.S.  Art. 601d,
 95-4    Secs. 9(a), (b) (part), (c).)
 95-5          Sec. 1232.103.  ISSUANCE OF OBLIGATIONS FOR EQUIPMENT.
 95-6    (a)  The authority may issue and sell obligations for the financing
 95-7    of:
 95-8                (1)  a lease or other agreement that concerns equipment
 95-9    that an executive or judicial branch state agency  has purchased or
95-10    leased or intends to purchase or lease; or
95-11                (2)  a package of agreements described by Subdivision
95-12    (1) that involves one or more state agencies.
95-13          (b)  An obligation issued by the authority is payable under
95-14    an agreement that may be in the nature of:
95-15                (1)  a lease under which the authority leases equipment
95-16    from a vendor for sublease to the commission or another state
95-17    agency;
95-18                (2)  a purchase by the authority of equipment and the
95-19    lease of that equipment to either:
95-20                      (A)  the commission for the benefit of a state
95-21    agency; or
95-22                      (B)  a state agency other than the commission;
95-23                (3)  a purchase by the authority of equipment and the
95-24    sale of that equipment to a state agency on an installment payment
95-25    basis; or
95-26                (4)  any similar agreement.
95-27          (c)  If an agreement is between the authority and a state
 96-1    agency or between a vendor and a state agency, the commission shall
 96-2    nevertheless perform its functions as purchasing agent for the
 96-3    state, with the funds obtained under this section used solely to
 96-4    finance the agreement.  The board and the commission shall adopt a
 96-5    memorandum of understanding that defines the division of authority
 96-6    between the board and the commission.
 96-7          (d)  A state agency may enter into a type of agreement
 96-8    described by this section to purchase or lease necessary equipment.
 96-9          (e)  If a law requires a state agency to obtain the approval
96-10    of another state agency or perform any other act before the agency
96-11    may purchase or lease computer equipment, those requirements must
96-12    be satisfied before the agency may enter into an agreement under
96-13    this chapter.  The authority shall adopt rules so that computer
96-14    equipment may not be financed before the authority receives written
96-15    proof that the requirements have been satisfied. (V.A.C.S.
96-16    Art. 601d, Sec.  9A.)
96-17          Sec. 1232.104.  ISSUANCE OF OBLIGATIONS FOR ALTERNATIVE FUEL
96-18    PROJECTS.  (a)  If the authority determines that a project is
96-19    financially viable and sufficient revenue is or will be available,
96-20    the authority may issue and sell obligations the proceeds of which
96-21    shall be used for the financing of:
96-22                (1)  the conversion of state agency vehicles and other
96-23    sources of substantial energy output to an alternative fuel under
96-24    Subchapter A, Chapter 2158;
96-25                (2)  the construction, acquisition, or maintenance by
96-26    the commission of fueling stations supplying alternative fuels or
96-27    equipment enhancing the use of engine-driven technology to support
 97-1    state agency vehicles and other energy applications that use an
 97-2    alternative fuel;
 97-3                (3)  the conversion of school district motor vehicles
 97-4    and other sources of substantial energy output to an alternative
 97-5    fuel;
 97-6                (4)  the construction, acquisition, or maintenance by a
 97-7    school district of fueling stations supplying alternative fuels or
 97-8    equipment enhancing the use of engine-driven technology to support
 97-9    school district motor vehicles and other energy applications that
97-10    use an alternative fuel;
97-11                (5)  the conversion of local mass transit authority or
97-12    department motor vehicles and other sources of substantial energy
97-13    output to an alternative fuel under Chapters 451, 452, and 453,
97-14    Transportation Code;
97-15                (6)  the construction, acquisition, or maintenance of
97-16    fueling stations supplying alternative fuels or equipment enhancing
97-17    the use of engine-driven technology by a local mass transit
97-18    authority or department to support transit authority or department
97-19    vehicles and other energy applications that use an alternative
97-20    fuel;
97-21                (7)  the conversion of motor vehicles and other sources
97-22    of substantial energy output of a local government, as defined by
97-23    Section 382.003, Health and Safety Code, to an alternative fuel
97-24    under Section 382.134, Health and Safety Code;
97-25                (8)  the conversion of motor vehicles and other sources
97-26    of substantial energy output of a hospital district or authority, a
97-27    housing authority, or a district or authority created under Section
 98-1    52, Article III, Texas Constitution, or Section 59, Article XVI,
 98-2    Texas Constitution, to an alternative fuel;
 98-3                (9)  the construction, acquisition, or maintenance of
 98-4    fueling stations supplying alternative fuels or equipment enhancing
 98-5    the use of engine-driven technology to support motor vehicles and
 98-6    other energy applications that use an alternative fuel by a county,
 98-7    a municipality, or an entity described by Subdivision (8); or
 98-8                (10)  a joint venture between the private sector and a
 98-9    state agency or political subdivision that is required under law to
98-10    use an alternative fuel in the agency's or subdivision's vehicles
98-11    or other energy applications to:
98-12                      (A)  convert vehicles or other sources of
98-13    substantial energy output to an alternative fuel;
98-14                      (B)  develop fueling stations and resources for
98-15    the supply of alternative fuels and engine-driven applications;
98-16                      (C)  aid in the distribution of alternative
98-17    fuels; and
98-18                      (D)  engage in other projects to facilitate the
98-19    use of alternative fuels.
98-20          (b)  The board may provide for the payment of the principal
98-21    of or interest on an obligation issued under this section:
98-22                (1)  by pledging all or a part of the revenue the state
98-23    derives from the sale of alternative fuel, alternative fuel
98-24    equipment or technology, or vehicles powered by an alternative
98-25    fuel;
98-26                (2)  by contracting with a political subdivision or a
98-27    private entity to pledge revenue the political subdivision or
 99-1    private entity derives from the sale of alternative fuel,
 99-2    alternative fuel equipment or technology, or vehicles powered by an
 99-3    alternative fuel in an amount sufficient to ensure that the
 99-4    obligations are paid;
 99-5                (3)  by pledging appropriated general revenues of the
 99-6    state or other appropriated money in the state treasury; or
 99-7                (4)  from any other source of funds available to the
 99-8    board.
 99-9          (c)  The authority shall attempt to:
99-10                (1)  include minority-owned businesses in the issuance
99-11    and underwriting of at least 20 percent of the obligations issued
99-12    under this section; and
99-13                (2)  include women-owned businesses in the issuance and
99-14    underwriting of at least 10 percent of the obligations issued under
99-15    this section.
99-16          (d)  Costs of administering the alternative fuel finance
99-17    program shall be considered a part of project costs and shall be
99-18    funded with proceeds of the obligations.  (V.A.C.S. Art. 601d,
99-19    Secs. 9C(a), (c), (d), (f) (part).)
99-20          Sec. 1232.105.  AGGREGATE LIMIT ON ISSUANCE OF OBLIGATIONS
99-21    FOR ALTERNATIVE FUEL PROJECTS.  The authority may not issue and
99-22    sell more than $50 million in obligations for projects under
99-23    Section 1232.104.  (V.A.C.S. Art. 601d, Sec. 9C(b).)
99-24          Sec. 1232.106.  EVALUATION OF APPLICATION FOR ASSISTANCE WITH
99-25    ALTERNATIVE FUEL PROJECTS.  (a)  The Alternative Fuels Council
99-26    shall evaluate an application by an eligible entity for the
99-27    financing under Section 1232.104 of the acquisition, construction,
 100-1   or improvement of alternative fuels infrastructure and shall
 100-2   determine whether the proposed project will increase energy or cost
 100-3   savings to the applicant.
 100-4         (b)  The authority may not issue an obligation under Section
 100-5   1232.104 unless the Alternative Fuels Council certifies that the
 100-6   proposed project will increase energy or cost savings to the
 100-7   applicant.
 100-8         (c)  The Alternative Fuels Council by rule may adopt
 100-9   procedures and standards for the evaluation of an application for
100-10   the financing of a proposed project under Section 1232.104.
100-11   (V.A.C.S.  Art. 601d, Sec. 9C(e).)
100-12         Sec. 1232.107.  PURCHASE OF OBLIGATIONS FOR ALTERNATIVE FUEL
100-13   PROJECTS.  (a)  The authority may use the proceeds of obligations
100-14   issued under Section 1232.104 to purchase, at a price determined by
100-15   the authority, an obligation of an entity described by Section
100-16   1232.104(a) that evidences the entity's obligation to repay the
100-17   authority.  Notwithstanding any other law, the authority may
100-18   acquire an obligation of an entity described by Section 1232.104(a)
100-19   in a private sale as provided by resolution or order of the
100-20   governing body of the entity.
100-21         (b)  An entity described by Section 1232.104(a) may borrow
100-22   from the authority by selling an obligation to the authority.
100-23   (V.A.C.S. Art. 601d, Secs. 9C(g), (h).)
100-24         Sec. 1232.108.  LEGISLATIVE AUTHORIZATION REQUIRED.  Except
100-25   as permitted by Section 1232.109, 2166.452, or 2166.453, before the
100-26   board may issue and sell bonds, the legislature by the General
100-27   Appropriations Act or other law must have authorized:
 101-1               (1)  the specific project for which the bonds are to be
 101-2   issued and sold; and
 101-3               (2)  the estimated cost of the project or the maximum
 101-4   amount of bonded indebtedness that may be incurred by the issuance
 101-5   and sale of bonds for the project.  (V.A.C.S. Art. 601d, Sec.
 101-6   10(a), as amended Acts 71st Leg., R.S., Ch. 786; Sec. 10(a) (part),
 101-7   as amended Acts 71st Leg., R.S., Ch. 1244, and Acts 73rd Leg.,
 101-8   R.S., Ch. 906; Sec. 10(b).)
 101-9         Sec. 1232.109.  AUTHORIZATION TO PURCHASE CERTAIN REAL
101-10   PROPERTY.  (a)  Because there is a continued need to acquire real
101-11   property in or in the immediate vicinity of state office building
101-12   complexes for the continued operation of state government, because
101-13   prices and values of real property periodically fluctuate, and
101-14   because the state must be able to respond to rapidly changing
101-15   market conditions to acquire real property at substantial savings
101-16   to taxpayers, the commission may purchase and renovate real
101-17   property located, in whole or in part, within 1,000 feet of:
101-18               (1)  the Capitol Complex in Travis County; or
101-19               (2)  the John H. Winters Human Services Complex in
101-20   Travis County.
101-21         (b)  The commission may contract as necessary to accomplish
101-22   the purposes stated in Subsection (a).  The estimated cost of the
101-23   project is $10 million.  Before purchasing property under this
101-24   section, the commission must determine that the purchase would be
101-25   in the state's best interest.  (V.A.C.S. Art. 601d, Secs.  24A(b)
101-26   (part), (d).)
101-27         Sec. 1232.110.  SPECIFIC PROJECTS IN TRAVIS COUNTY.  The
 102-1   board may issue bonds under Section 1232.102 for the following
 102-2   projects:
 102-3   Project                                              Estimated Cost
 102-4   State Board of Insurance Building in                    $59,937,000
 102-5   Travis County; facilities associated
 102-6   with relocation of the State Aircraft
 102-7   Pooling Board (not to exceed an
 102-8   estimated amount of $7,000,000); and
 102-9   the acquisition and development of
102-10   acreage at Robert Mueller Municipal
102-11   Airport for a state complex (not to
102-12   exceed an estimated amount of
102-13   $41,000,000)
102-14   Laboratory and Office Facilities                        $42,300,000
102-15   for the Texas Department of Health
102-16   Parking facilities for state                            $29,500,000
102-17   officers and employees to be built
102-18   on state parking Lot 20 and for
102-19   visitors to the Capitol Complex to
102-20   be built on state parking Lot 17
102-21   (V.A.C.S. Art. 601d, Secs. 24A(a) (part), (b) (part); 24B(a), (b)
102-22   (part).)
102-23         Sec. 1232.111.  SPECIFIC PROJECTS OUTSIDE TRAVIS COUNTY.
102-24   (a)  Notwithstanding the limitations under Section 1232.102 as to
102-25   the location of buildings for which bonds may be issued, the board
102-26   may issue bonds under this chapter for the following projects:
102-27   Project                                              Estimated Cost
 103-1   Construction or purchase and renovation                 $10,000,000
 103-2   of a building or buildings by the
 103-3   commission in Tarrant County
 103-4   Construction or purchase and renovation                 $20,000,000
 103-5   of a building or buildings by the
 103-6   commission in Harris County
 103-7         (b)  The commission shall, before requesting that the
 103-8   authority issue bonds, prepare a project analysis for the potential
 103-9   construction project and subsequently perform an alternative
103-10   purchase analysis as provided by Chapter 2166.  (V.A.C.S.
103-11   Art. 601d, Sec. 24A(c) (part).)
103-12         Sec. 1232.112.  BOND REVIEW BOARD APPROVAL.  (a)  The
103-13   authority may not issue obligations until the Bond Review Board has
103-14   approved the issuance under Chapter 1231.
103-15         (b)  The Bond Review Board may not approve a bond issue
103-16   unless a project analysis is submitted for approval as provided by
103-17   Section 1232.114.
103-18         (c)  Refunding obligations of the authority must be approved
103-19   by the Bond Review Board.  (V.A.C.S. Art. 601d, Sec. 10A(c), as
103-20   added Acts 71st Leg., R.S., Ch. 896; Sec. 10B(a).)
103-21         Sec. 1232.113.  OBLIGATION ISSUANCE ORIENTATION; INFORMATION
103-22   TO AND FROM CLIENT AGENCIES.  (a)  In this section, "client agency"
103-23   means a state agency on whose behalf the board may issue
103-24   obligations.
103-25         (b)  The authority shall develop an orientation to the
103-26   obligation issuance process for the authority's client agencies.
103-27         (c)  The orientation must include:
 104-1               (1)  information explaining the obligation issuance
 104-2   process in plain language; and
 104-3               (2)  an orientation meeting to be held before the
 104-4   issuance process begins.
 104-5         (d)  As part of the orientation, a client agency shall
 104-6   provide to the authority:
 104-7               (1)  detailed information concerning the project for
 104-8   which obligations are to be issued;
 104-9               (2)  a description of the legislative authority for the
104-10   issuance of the obligations; and
104-11               (3)  the names of employees of the client agency who
104-12   are designated to work with the authority in connection with the
104-13   project.
104-14         (e)  The authority shall prepare information of interest to
104-15   the authority's client agencies describing the functions of the
104-16   authority and the procedures by which complaints are filed with and
104-17   resolved by the authority.  The authority shall make the
104-18   information available to its client agencies.
104-19         (f)  The board by rule shall establish methods by which
104-20   client agencies are notified of the name, mailing address, and
104-21   telephone number of the authority for the purpose of directing
104-22   complaints to the authority.  The board may provide for that
104-23   notification on a form provided to a client agency during the
104-24   orientation.  (V.A.C.S. Art. 601d, Sec. 9D.)
104-25         Sec. 1232.114.  PROJECT ANALYSIS.  (a)  When the authority
104-26   submits its application for approval of a bond issue to the Bond
104-27   Review Board, the agency or institution that will use the project
 105-1   to be financed by the bonds shall submit to the Bond Review Board a
 105-2   project analysis of the project.  The project analysis must be in
 105-3   the form required for a project analysis requested from the
 105-4   commission under Sections 2166.151-2166.155.
 105-5         (b)  This section does not apply to a minor renovation,
 105-6   repair, or construction project of the institutional division of
 105-7   the Texas Department of Criminal Justice as defined by the division
 105-8   in cooperation with the commission.  Instead of submitting a
 105-9   project analysis, the division may substitute the master plan
105-10   required to be submitted by Section 1401.121 if the master plan
105-11   contains information substantially equivalent to the information
105-12   required to be in a project analysis under Sections
105-13   2166.151-2166.155.  (V.A.C.S. Art. 601d, Secs. 10A(a), (b), as
105-14   added Acts 71st Leg., R.S., Ch. 896.)
105-15         Sec. 1232.115.  EXPENSES INCLUDED IN PRINCIPAL AMOUNT.  (a)
105-16   The principal amount of obligations may include amounts required to
105-17   pay required reserve funds, capitalized interest, the authority's
105-18   administrative costs, issuing expenses, and other expenses
105-19   associated with the authority's issuance and sale of the
105-20   obligations.
105-21         (b)  The principal amount of obligations issued to finance
105-22   the purchase of computer equipment that is the subject of a
105-23   contingent appropriation under Subchapter B, Chapter 317, must be
105-24   sufficient to cover any payments of principal and interest that
105-25   must occur during the remainder of the biennium after the
105-26   obligations are issued.
105-27         (c)  Because of the expenses specified by Subsection (a) and
 106-1   because the cost estimates for acquisition, construction, repair,
 106-2   or renovation of a project cannot be finally determined at the time
 106-3   the project is authorized for financing, the principal amount of
 106-4   any issuance of obligations may be an amount not to exceed 150
 106-5   percent of the amount of the estimated cost for the project being
 106-6   financed.
 106-7         (d)  Additional costs may not be included in the principal
 106-8   amount determined under this section unless the board finds that
 106-9   those costs are necessary and reasonable at the time the
106-10   obligations are issued.  (V.A.C.S. Art. 601d, Sec. 10(a) (part), as
106-11   amended Acts 71st Leg., R.S.,  Ch. 1244, and Acts 73rd Leg., R.S.,
106-12   Ch. 906; Sec. 10A, as added Acts 71st Leg., R.S., Ch. 786.)
106-13         Sec. 1232.116.  MANNER OF REPAYMENT.  (a)  The board may
106-14   provide for the payment of the principal of and interest on
106-15   obligations issued under this chapter:
106-16               (1)  by pledging all or part of the revenue derived
106-17   from:
106-18                     (A)  leasing a building or equipment to a state
106-19   agency either directly or through the commission; or
106-20                     (B)  selling equipment on an installment basis to
106-21   a state agency either directly or through the commission; or
106-22               (2)  from any other funds lawfully available to the
106-23   board.
106-24         (b)  From funds appropriated for paying rental charges or
106-25   making installment payments on buildings or equipment, the
106-26   commission or an occupying or using state agency shall pay to the
106-27   board a rental or make installment payments on the buildings or
 107-1   equipment.
 107-2         (c)  The board shall determine the amount of the rental or
 107-3   installment payments.  The amount must be sufficient to:
 107-4               (1)  pay the principal of and interest on the
 107-5   obligations;
 107-6               (2)  maintain any reserve fund required for servicing
 107-7   the obligations; and
 107-8               (3)  reimburse the authority for other costs incurred
 107-9   by it with respect to the obligations.
107-10         (d)  When the commission or another state agency is required
107-11   by Subsection (b) to pay a rental to the authority and the
107-12   commission or other state agency depends on receiving a rental from
107-13   an occupying or using state agency to pay the authority, the
107-14   commission or other state agency shall set the rental in an amount
107-15   that is sufficient to pay the rental required by the board.
107-16         (e)  In addition to other sources of repayment provided by
107-17   this section, the legislature by law may direct that money in the
107-18   Texas capital trust fund account be used to pay the principal of
107-19   and interest on bonds issued under this chapter for the acquisition
107-20   or construction of a building.
107-21         (f)  The legislature may require the deposit into the Texas
107-22   capital trust fund account of all or part of the proceeds of a
107-23   transaction concerning a building.  (V.A.C.S. Art. 601d, Secs.
107-24   12(a), (b), (c), (f).)
107-25         Sec. 1232.117.  STATE DEBT NOT CREATED.  (a)  An obligation
107-26   issued under this chapter is not a debt of the state or any state
107-27   agency, political corporation, or political subdivision of the
 108-1   state and is not a pledge of the faith and credit of any of them.
 108-2   A bond is payable solely from revenue as provided by this chapter.
 108-3         (b)  An obligation issued under this chapter must contain on
 108-4   its face a statement to the effect that:
 108-5               (1)  neither the state nor a state agency, political
 108-6   corporation, or political subdivision of the state is obligated to
 108-7   pay the principal of or interest on the obligation except as
 108-8   provided by this chapter; and
 108-9               (2)  neither the faith and credit nor the taxing power
108-10   of the state or any state agency, political corporation, or
108-11   political subdivision of the state is pledged to the payment of the
108-12   principal of or interest on the obligation.  (V.A.C.S. Art. 601d,
108-13   Sec. 13.)
108-14         Sec. 1232.118.  ORDER OR RESOLUTION AUTHORIZING ISSUANCE OF
108-15   OBLIGATIONS.  (a)  An order or resolution of the board authorizing
108-16   the issuance of obligations, including refunding obligations, may
108-17   provide for the flow of funds and the establishment and maintenance
108-18   of the interest and sinking fund, the reserve fund, and other
108-19   funds.
108-20         (b)  The order or resolution may:
108-21               (1)  prohibit the issuance of additional obligations
108-22   payable from the pledged revenues; or
108-23               (2)  preserve the right of the board to issue
108-24   additional obligations that are on a parity with or subordinate to
108-25   the lien and pledge on the revenue being used to support the
108-26   obligations being issued pursuant to the order or resolution.
108-27         (c)  The order or resolution may contain any other provision
 109-1   or covenant determined by the board.
 109-2         (d)  The board may make covenants with respect to the
 109-3   obligations, the pledged revenues, and the operation and
 109-4   maintenance of the buildings or equipment financed under this
 109-5   chapter.  (V.A.C.S. Art. 601d, Secs. 15(a)-(c).)
 109-6         Sec. 1232.119.  ADOPTION AND EXECUTION OF INSTRUMENTS.  The
 109-7   board may adopt and have executed any other proceeding or
 109-8   instrument necessary and convenient in the issuance of obligations.
 109-9   (V.A.C.S. Art. 601d, Sec. 15(d).)
109-10         Sec. 1232.120.  EXEMPTION FROM TAXATION.  An obligation
109-11   issued by the board, any transaction relating to the obligation,
109-12   and profits made from the sale of the obligation are exempt from
109-13   taxation by this state or by a municipality or other political
109-14   subdivision of this state.  (V.A.C.S. Art. 601d, Sec.  20.)
109-15         Sec. 1232.121.  CERTIFICATION AND DEPOSIT OF PROCEEDS OF
109-16   OBLIGATIONS.  (a)  After issuing obligations, the board shall
109-17   certify to the commission or the appropriate state agency and to
109-18   the comptroller that the proceeds from the issuance are available.
109-19   The board shall deposit the proceeds in the state treasury.
109-20         (b)  The proceeds shall be credited to the account of the
109-21   state agency that is responsible under an agreement for making
109-22   rental or installment payments to the authority.  (V.A.C.S.
109-23   Art. 601d, Sec. 23(a).)
109-24         Sec. 1232.122.  COMMENCEMENT OF CONSTRUCTION, PURCHASE, OR
109-25   LEASE.  The acquisition or construction of a building or the
109-26   purchase or lease of equipment may begin after:
109-27               (1)  the authority has certified that obligations in an
 110-1   amount sufficient to pay the construction or purchase price of the
 110-2   project have been authorized for issuance by the authority under an
 110-3   interim construction finance agreement established by the authority
 110-4   in accordance with Chapter 1371; or
 110-5               (2)  the proceeds have been deposited into the state
 110-6   treasury and:
 110-7                     (A)  the comptroller has certified that the
 110-8   proceeds are available;
 110-9                     (B)  the reserve funds and capitalized interest,
110-10   as certified by the authority as reasonably required, have been
110-11   paid; and
110-12                     (C)  the costs of issuing the obligations, as
110-13   certified by the authority, have been paid.  (V.A.C.S. Art. 601d,
110-14   Sec. 23(b).)
110-15         Sec. 1232.123.  INVESTMENT OF BOND PROCEEDS.  (a)  With the
110-16   board's concurrence, the comptroller shall invest the unexpended
110-17   bond proceeds and investment income on bond proceeds in investments
110-18   approved by law for the investment of state funds.
110-19         (b)  Investment income that the board determines is needed to
110-20   finance the acquisition, construction, purchase, or lease of
110-21   buildings or equipment and that is not required to be rebated to
110-22   the federal government shall be credited to the account of the
110-23   appropriate state agency.
110-24         (c)  Investment income that the board determines is not
110-25   needed to finance the acquisition, construction, purchase, or lease
110-26   of buildings or equipment and that is not required to be rebated to
110-27   the federal government shall be credited to and accounted for in
 111-1   the state lease fund account.
 111-2         (d)  Notwithstanding Section 404.071, the interest earned on
 111-3   the investment income that is deposited in the state lease fund
 111-4   account shall be credited to and accounted for in that account.
 111-5   (V.A.C.S. Art. 601d, Secs. 23(c), (d), (e).)
 111-6           (Sections 1232.124-1232.200 reserved for expansion)
 111-7      SUBCHAPTER D.  LEASE AND CONVEYANCE OF PROPERTY BY AUTHORITY
 111-8         Sec. 1232.201.  RENT AND FEES.  (a)  The commission or the
 111-9   appropriate state agency shall establish schedules necessary to
111-10   properly charge occupying state agencies for the expenses incurred
111-11   in financing the acquisition or construction of buildings in
111-12   accordance with this chapter.
111-13         (b)  An occupying state agency shall,  when the payments are
111-14   due, pay to the commission, the appropriate state agency, or
111-15   directly into the state lease fund account the amount determined by
111-16   the commission.  Instead of payments by an occupying state agency,
111-17   the legislature may appropriate money on the agency's behalf
111-18   directly to the state lease fund account.
111-19         (c)  Payments received by the commission or another state
111-20   agency under this section shall be deposited to the credit of the
111-21   state lease fund account.  (V.A.C.S. Art. 601d, Secs. 25(a), (b),
111-22   (c).)
111-23         Sec. 1232.202.  CONTRACTS CONTINGENT ON LEGISLATIVE
111-24   APPROPRIATIONS.  (a)  Each lease or installment sale contract
111-25   entered into under this chapter is contingent on the legislature's
111-26   appropriation of sufficient funds.
111-27         (b)  The board may act as necessary to ensure that the
 112-1   payment of the principal of and interest on obligations is
 112-2   continued without interruption if:
 112-3               (1)  sufficient appropriated funds are unavailable;
 112-4               (2)  the commission or another state agency fails to
 112-5   pay a rental or installment; or
 112-6               (3)  the commission or another state agency fails to
 112-7   renew a lease contract.
 112-8         (c)  Permissible actions under Subsection (b) include:
 112-9               (1)  the re-leasing or subleasing of buildings or
112-10   equipment to any entity; and
112-11               (2)  the repossession and resale of equipment to any
112-12   entity.  (V.A.C.S. Art. 601d, Sec. 12(d).)
112-13         Sec. 1232.203.  LEASE OF SPACE TO CHILD CARE DEVELOPMENT
112-14   BOARD.  (a)  The Child Care Development Board is not an occupying
112-15   state agency for purposes of Section 1232.201.
112-16         (b)  The commission or the appropriate state agency, with the
112-17   cooperation and assistance of the Child Care Development Board,
112-18   shall include in the schedules developed under Section 1232.201(a)
112-19   the method of charging state agencies that occupy all or part of a
112-20   building to which Section 1232.201 applies for the space in the
112-21   building that is used for a child-care facility under Chapters 663,
112-22   2165, and 2166.
112-23         (c)  An occupying agency's share shall be determined at least
112-24   in part on the ratio of the number of the occupying agency's
112-25   employees who work in the building to the total number of state
112-26   employees who work in the building.  (V.A.C.S. Art. 601d, Sec.
112-27   25(d).)
 113-1         Sec. 1232.204.  LEASING PREFERENCE.  A building owned by the
 113-2   authority is considered state-owned space for the purposes of:
 113-3               (1)  Section 2165.107; and
 113-4               (2)  child-care facility sites located in state-owned
 113-5   buildings under Chapters 663, 2165, and 2166.  (V.A.C.S. Art. 601d,
 113-6   Sec. 29.)
 113-7         Sec. 1232.205.  LEASE OF SPACE TO OUTSIDE ENTITIES.  The
 113-8   board may lease all or part of a building, the acquisition or
 113-9   construction of which was financed under this chapter, to any
113-10   person if the building cannot be leased to the commission or
113-11   another state agency.  (V.A.C.S. Art. 601d, Sec. 12(e) (part).)
113-12         Sec. 1232.206.  PROPERTY CONVEYANCE.  (a)  When the principal
113-13   of and interest on obligations relating to equipment or a building
113-14   financed under this chapter are fully paid and the equipment or
113-15   building is free of all liens, the board shall certify to the
113-16   commission or the appropriate state agency that rentals, payments,
113-17   or installments are no longer required to pay the principal of and
113-18   interest on the obligations.
113-19         (b)  When making the certification required by Subsection
113-20   (a), the board shall, if necessary and for $1, convey the title of
113-21   the equipment or building, including any real property, to the
113-22   commission or the appropriate state agency.  (V.A.C.S. Art. 601d,
113-23   Sec. 28.)
113-24                 CHAPTER 1233.  COLLEGE OPPORTUNITY ACT
113-25                    SUBCHAPTER A.  GENERAL PROVISIONS
113-26   Sec. 1233.001.  SHORT TITLE
113-27   Sec. 1233.002.  DEFINITIONS
 114-1   Sec. 1233.003.  EFFECT ON OTHER LAW
 114-2           (Sections 1233.004-1233.050 reserved for expansion)
 114-3                SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
 114-4   Sec. 1233.051.  COLLEGE OPPORTUNITY ACT COMMITTEE
 114-5   Sec. 1233.052.  PRESIDING OFFICER; PROCEDURES
 114-6   Sec. 1233.053.  DEPUTIES
 114-7           (Sections 1233.054-1233.100 reserved for expansion)
 114-8          SUBCHAPTER C.  BENEFITS OF COLLEGE OPPORTUNITY BONDS
 114-9   Sec. 1233.101.  FINANCIAL INCENTIVES AND BONUSES
114-10   Sec. 1233.102.  EFFECT ON OTHER FINANCIAL AID
114-11           (Sections 1233.103-1233.150 reserved for expansion)
114-12               SUBCHAPTER D.  ELIGIBILITY REQUIREMENTS AND
114-13           PROCEDURES FOR DESIGNATION AS COLLEGE SAVINGS BOND
114-14   Sec. 1233.151.  BONDS ELIGIBLE FOR DESIGNATION AS COLLEGE SAVINGS
114-15                     BONDS
114-16   Sec. 1233.152.  APPLICATION FOR DESIGNATION
114-17   Sec. 1233.153.  COMMITTEE REVIEW AND DETERMINATION
114-18   Sec. 1233.154.  CONSIDERATION BY BOARD; DESIGNATION
114-19   Sec. 1233.155.  CONSIDERATION AND DESIGNATION OF ADDITIONAL
114-20                     BONDS
114-21   Sec. 1233.156.  APPROVAL BY ATTORNEY GENERAL
114-22           (Sections 1233.157-1233.200 reserved for expansion)
114-23              SUBCHAPTER E.  ISSUANCE, SALE, AND MARKETING
114-24   Sec. 1233.201.  TYPE AND DENOMINATION OF BOND
114-25   Sec. 1233.202.  REDEMPTION PRICE
114-26   Sec. 1233.203.  AGGREGATE PRINCIPAL AMOUNT
114-27   Sec. 1233.204.  PRIVATE OR NEGOTIATED SALE
 115-1   Sec. 1233.205.  MARKETING AND DISTRIBUTION
 115-2   Sec. 1233.206.  USE OF PHRASE "COLLEGE SAVINGS BOND"
 115-3                     RESTRICTED
 115-4                 CHAPTER 1233.  COLLEGE OPPORTUNITY ACT
 115-5                    SUBCHAPTER A.  GENERAL PROVISIONS
 115-6         Sec. 1233.001.  SHORT TITLE.  This chapter may be cited as
 115-7   the College Opportunity Act.  (V.A.C.S. Art. 717u, Sec. 1.)
 115-8         Sec. 1233.002.  DEFINITIONS.  In this chapter:
 115-9               (1)  "Board" means the Bond Review Board.
115-10               (2)  "Committee" means the College Opportunity Act
115-11   committee.
115-12               (3)  "College savings bond" means a general obligation
115-13   bond or another instrument authorized to be designated as a college
115-14   savings bond under this chapter.
115-15               (4)  "Issuer" means:
115-16                     (A)  the Veterans' Land Board;
115-17                     (B)  the Texas Water Development Board;
115-18                     (C)  the Texas Higher Education Coordinating
115-19   Board; or
115-20                     (D)  another state agency authorized under this
115-21   chapter to designate part or all of its general obligation bonds as
115-22   college savings bonds.
115-23               (5)  "Postsecondary educational institution" includes
115-24   an institution of higher education, as that term is defined by
115-25   Section 61.003, Education Code, and a private, nonprofit
115-26   institution of higher education that is accredited by a recognized
115-27   accrediting agency, as that term is defined by Section 61.003,
 116-1   Education Code, and that is located and authorized to operate in
 116-2   this state.  The term does not include a private institution of
 116-3   higher education operated exclusively for sectarian purposes,
 116-4   religious teaching or worship, or the training of professionals in
 116-5   the field of religion. (V.A.C.S. Art. 717u, Sec. 2 (part).)
 116-6         Sec. 1233.003.  EFFECT ON OTHER LAW.  To the extent of any
 116-7   conflict between this chapter and other law in regard to college
 116-8   savings bonds, this chapter controls.  (V.A.C.S. Art. 717u, Sec. 15
 116-9   (part).)
116-10           (Sections 1233.004-1233.050 reserved for expansion)
116-11                SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
116-12         Sec. 1233.051.  COLLEGE OPPORTUNITY ACT COMMITTEE.  (a)  The
116-13   College Opportunity Act committee consists of:
116-14               (1)  the following ex officio members:
116-15                     (A)  the commissioner of the General Land Office;
116-16                     (B)  the commissioner of higher education;
116-17                     (C)  the executive administrator of the Texas
116-18   Water Development Board;
116-19                     (D)  the comptroller;
116-20                     (E)  the executive director of the board; and
116-21                     (F)  the chief executive officer of a state
116-22   agency authorized by the board under Section 1233.155 to designate
116-23   any part of its general obligation bonds as college savings bonds;
116-24   and
116-25               (2)  three public members appointed by the governor
116-26   with the advice and consent of the senate.
116-27         (b)  A public member must have knowledge, skill, and
 117-1   experience in an academic, business, or financial field.
 117-2         (c)  Public members serve staggered, six-year terms, with the
 117-3   term of one member expiring February 1 of each odd-numbered year.
 117-4         (d)  A vacancy in the office of a public member shall be
 117-5   filled by appointment for the unexpired term.  (V.A.C.S. Art. 717u,
 117-6   Secs. 4(a), (b), (c), (d); 6(d).)
 117-7         Sec. 1233.052.  PRESIDING OFFICER; PROCEDURES.  (a)  The
 117-8   committee shall designate a member of the committee to serve as
 117-9   presiding officer.
117-10         (b)  The committee shall establish procedures for the conduct
117-11   of its business. (V.A.C.S. Art. 717u, Sec. 4(f).)
117-12         Sec. 1233.053.  DEPUTIES.  An ex officio member of the
117-13   committee may appoint a deputy to serve as a voting member of the
117-14   committee in the member's absence.  (V.A.C.S. Art. 717u, Sec.
117-15   4(e).)
117-16           (Sections 1233.054-1233.100 reserved for expansion)
117-17          SUBCHAPTER C.  BENEFITS OF COLLEGE OPPORTUNITY BONDS
117-18         Sec. 1233.101.  FINANCIAL INCENTIVES AND BONUSES.  (a) The
117-19   committee may authorize financial incentives for a holder of a
117-20   college savings bond to encourage the enrollment of students at
117-21   postsecondary educational institutions.  The committee shall
117-22   establish procedures necessary to implement this section.
117-23         (b)  A bonus payment may be paid under this subsection to the
117-24   holder of a college savings bond at maturity only if the holder
117-25   owned the college savings bond for the five years preceding the
117-26   bond's maturity date.
117-27         (c)  The bonus payment may be paid to the holder of any
 118-1   college savings bond at maturity in a form that may be applied only
 118-2   to tuition costs at a postsecondary educational institution.
 118-3         (d)  The amount of the bonus payment for each year must be at
 118-4   least equal to four-tenths of one percent of the college savings
 118-5   bond's face amount, applied to each full year from the date of
 118-6   purchase to the earlier of the date of redemption or the date of
 118-7   maturity.  Subject to Subsection (e), the committee may increase
 118-8   the amount of the payment at the time the committee authorizes the
 118-9   college savings bond.
118-10         (e)  The amount of financial incentives provided under this
118-11   section during a state fiscal biennium may not exceed an amount
118-12   equal to one-half of one percent of the total amount of college
118-13   savings bonds maturing during that biennium.  (V.A.C.S. Art. 717u,
118-14   Sec. 11.)
118-15         Sec. 1233.102.  EFFECT ON OTHER FINANCIAL AID.  In
118-16   determining a student's eligibility for monetary assistance,
118-17   including a scholarship or grant, awarded by a state agency or the
118-18   amount of financial assistance to provide the student, an amount of
118-19   $10,000 or less in proceeds from college savings bonds, including
118-20   principal and accumulated interest, may not be considered:
118-21               (1)  a financial resource of the student;  or
118-22               (2)  a form of financial aid or assistance to the
118-23   student.  (V.A.C.S. Art. 717u, Sec. 12.)
118-24           (Sections 1233.103-1233.150 reserved for expansion)
118-25               SUBCHAPTER D.  ELIGIBILITY REQUIREMENTS AND
118-26           PROCEDURES FOR DESIGNATION AS COLLEGE SAVINGS BOND
118-27         Sec. 1233.151.  BONDS ELIGIBLE FOR DESIGNATION AS COLLEGE
 119-1   SAVINGS BONDS.  All or part of the following bonds are eligible to
 119-2   be designated as college savings bonds:
 119-3               (1)  veterans' land and housing bonds authorized under
 119-4   Sections 49-b and 49-b-1, Article III, Texas Constitution, issued
 119-5   by the Veterans' Land Board;
 119-6               (2)  farm and ranch loan bonds authorized under Section
 119-7   49-f, Article III, Texas Constitution;
 119-8               (3)  water development bonds authorized by Sections
 119-9   49-c, 49-d, 49-d-1, 49-d-2, 49-d-4, 49-d-6, and 50-d, Article III,
119-10   Texas Constitution, issued by the Texas Water Development Board;
119-11               (4)  college student loan bonds authorized by Sections
119-12   50b and 50b-1, Article III, Texas Constitution, issued by the Texas
119-13   Higher Education Coordinating Board; or
119-14               (5)  bonds issued by an issuer to refund bonds
119-15   described by Subdivisions (1)-(4).  (V.A.C.S. Art. 717u, Sec.
119-16   5(a).)
119-17         Sec. 1233.152.  APPLICATION FOR DESIGNATION.  To have a bond
119-18   designated as a college savings bond, the issuer must:
119-19               (1)  apply for approval in the manner prescribed by the
119-20   committee; and
119-21               (2)  submit with the application any other information
119-22   the committee requires.  (V.A.C.S. Art. 717u, Sec. 5(b).)
119-23         Sec. 1233.153.  COMMITTEE REVIEW AND DETERMINATION.  (a) The
119-24   committee shall examine an application and other information
119-25   submitted by an issuer under Section 1233.152.
119-26         (b)  The committee shall recommend to the board that all or
119-27   part of the bonds be approved for designation as college savings
 120-1   bonds if the committee determines that the designation:
 120-2               (1)  is advisable; and
 120-3               (2)  is of economic benefit to the bondholders and to
 120-4   this state.  (V.A.C.S. Art. 717u, Sec. 5(c).)
 120-5         Sec. 1233.154.  CONSIDERATION BY BOARD; DESIGNATION.  (a)
 120-6   The board shall consider the application and other information
 120-7   submitted by an issuer and shall approve the designation of part or
 120-8   all of the bonds as college savings bonds if, after examining the
 120-9   application and other information, the board determines that the
120-10   designation as college savings bonds is advisable.
120-11         (b)  The bonds shall be designated as college savings bonds
120-12   in any manner that:
120-13               (1)  the resolution providing for the issuance of the
120-14   bonds specifies; and
120-15               (2)  the board considers appropriate.  (V.A.C.S.
120-16   Art. 717u, Secs. 5(d), (e).)
120-17         Sec. 1233.155.  CONSIDERATION AND DESIGNATION OF ADDITIONAL
120-18   BONDS.  (a) A state agency, including a state agency listed under
120-19   Section 1233.151, that issues general obligation bonds not
120-20   specified by that section may apply to the committee to issue those
120-21   general obligation bonds as college savings bonds.
120-22         (b)  The committee shall consider the application as provided
120-23   by Section 1233.153 and may recommend to the board that the state
120-24   agency be granted authority to designate all or part of the general
120-25   obligation bonds issued by the state agency as college savings
120-26   bonds if the committee determines that the authorization:
120-27               (1)  is advisable;
 121-1               (2)  is consistent with the purposes of this chapter;
 121-2   and
 121-3               (3)  is of economic benefit to the bondholders and to
 121-4   this state.
 121-5         (c)  The board shall consider the state agency's application
 121-6   and shall approve the designation of all or part of the bonds as
 121-7   college savings bonds if the board determines that the designation
 121-8   of the bonds as college savings bonds is advisable.  (V.A.C.S.
 121-9   Art. 717u, Secs. 6(a), (b), (c).)
121-10         Sec. 1233.156.  APPROVAL BY ATTORNEY GENERAL.  The attorney
121-11   general may not approve the issuance as a college savings bond of a
121-12   bond that requires the attorney general's approval before issuance
121-13   unless the bond is issued in accordance with this chapter.
121-14   (V.A.C.S. Art. 717u, Sec. 14.)
121-15           (Sections 1233.157-1233.200 reserved for expansion)
121-16              SUBCHAPTER E.  ISSUANCE, SALE, AND MARKETING
121-17         Sec. 1233.201.  TYPE AND DENOMINATION OF BOND.  A college
121-18   savings bond:
121-19               (1)  must be a:
121-20                     (A)  zero coupon bond;
121-21                     (B)  capital appreciation bond;
121-22                     (C)  compound interest bond;
121-23                     (D)  municipal multiplier bond;
121-24                     (E)  capital accumulator bond; or
121-25                     (F)  similar type of bond that will encourage the
121-26   purchaser to hold the bond until maturity; and
121-27               (2)  must be issued in small denominations, in
 122-1   accordance with guidelines established by the committee to make the
 122-2   bonds attractive for financing the costs of higher education.
 122-3   (V.A.C.S. Art. 717u, Sec. 7(b).)
 122-4         Sec. 1233.202.  REDEMPTION PRICE.  A college savings bond may
 122-5   not be callable before maturity at a price less than its stated
 122-6   value at maturity except:
 122-7               (1)  under a mandatory redemption or call provision of
 122-8   the resolution authorizing the bond; or
 122-9               (2)  as otherwise authorized by law. (V.A.C.S.
122-10   Art. 717u, Sec. 7(a).)
122-11         Sec. 1233.203.  AGGREGATE PRINCIPAL AMOUNT.  For the purpose
122-12   of determining the amount of bonds that an issuer may issue under
122-13   the Texas Constitution and designate as college savings bonds under
122-14   this chapter, the aggregate principal amount is the aggregate of
122-15   the initial offering prices, excluding accrued interest, at which
122-16   the bonds are offered for sale to the public, including a private
122-17   or negotiated sale, without a reduction for an underwriter's
122-18   discount or the fee of a placement agent or other intermediary.
122-19   (V.A.C.S. Art. 717u, Sec. 9.)
122-20         Sec. 1233.204.  PRIVATE OR NEGOTIATED SALE.  (a)  A series of
122-21   bonds that includes college savings bonds may be sold at a private
122-22   or negotiated sale if the committee determines that a private or
122-23   negotiated sale will result in a more efficient and economic sale
122-24   of the bonds or greater access to the bonds by investors who are
122-25   residents of this state.
122-26         (b)  If college savings bonds are sold at a private or
122-27   negotiated sale, the underwriter to whom the bonds are sold must
 123-1   have, in the committee's judgment, sufficient capability to broadly
 123-2   distribute the bonds to investors who are residents of this state.
 123-3   (V.A.C.S. Art. 717u, Sec. 8.)
 123-4         Sec. 1233.205.  MARKETING AND DISTRIBUTION.  (a) The
 123-5   committee shall coordinate the marketing and distribution of
 123-6   college savings bonds.
 123-7         (b)  The committee may delegate to the board responsibility
 123-8   for disseminating information about and advertising the college
 123-9   savings bonds.  The board may use its staff to assist in, or may
123-10   contract with another entity for services to carry out, a duty
123-11   delegated to the board under this subsection.
123-12         (c)  The committee may contract for the services of financial
123-13   advisors and for legal services to assist the committee in
123-14   marketing and distributing and in disseminating information about
123-15   college savings bonds.
123-16         (d)  In coordinating the marketing of college savings bonds,
123-17   the committee shall emphasize the use of college savings bonds to
123-18   finance the costs of higher education.  For this purpose, the
123-19   committee shall provide information about the college savings bonds
123-20   to institutions of higher education, other education-related
123-21   organizations, the financial services community, and the public.
123-22         (e)  The committee may not publish information purporting to
123-23   describe the details or terms of or the security for a particular
123-24   issue of college savings bonds unless the issuer of the college
123-25   savings bonds approves publication of that information.  (V.A.C.S.
123-26   Art. 717u, Sec. 10.)
123-27         Sec. 1233.206.  USE OF PHRASE "COLLEGE SAVINGS BOND"
 124-1   RESTRICTED.  A public legal entity, including a state agency or a
 124-2   municipality or other political subdivision, may not, unless the
 124-3   board has designated a bond or note as a college savings bond under
 124-4   this chapter:
 124-5               (1)  use the phrase "college savings bond" in
 124-6   connection with the issuance, sale, or marketing of a bond or note
 124-7   by the entity; or
 124-8               (2)  authorize a broker or dealer in municipal bonds or
 124-9   notes to use the phrase "college savings bonds" in connection with
124-10   the sale, resale, marketing, or distribution of a bond or note.
124-11   (V.A.C.S. Art. 717u, Sec. 13.)
124-12               (Chapters 1234-1250 reserved for expansion)
124-13         SUBTITLE C.  PROVISIONS APPLICABLE TO SECURITIES ISSUED
124-14                BY MORE THAN ONE TYPE OF LOCAL GOVERNMENT
124-15                      CHAPTER 1251.  BOND ELECTIONS
124-16   Sec. 1251.001.  BOND ELECTION REQUIRED
124-17   Sec. 1251.002.  CONTENTS OF PROPOSITION
124-18   Sec. 1251.003.  CONDUCT OF ELECTION
124-19   Sec. 1251.004.  IMPOSITION OF TAX
124-20   Sec. 1251.005.  BALLOT PROPOSITION
124-21   Sec. 1251.006.  CERTAIN BONDS EXEMPTED
124-22                      CHAPTER 1251.  BOND ELECTIONS
124-23         Sec. 1251.001.  BOND ELECTION REQUIRED.  A county or
124-24   municipality may not issue bonds that are to be paid from ad
124-25   valorem taxes unless the issuance is first approved by the
124-26   qualified voters of the county or municipality in an election.
124-27   (V.A.C.S. Art. 701.)
 125-1         Sec. 1251.002.  CONTENTS OF PROPOSITION.  The proposition
 125-2   submitted in the election must distinctly state:
 125-3               (1)  the purpose for which the bonds are to be issued;
 125-4               (2)  the amount of the bonds;
 125-5               (3)  the rate of interest;
 125-6               (4)  the imposition of taxes sufficient to pay the
 125-7   annual interest on the bonds and to provide a sinking fund to
 125-8   redeem the bonds at maturity; and
 125-9               (5)  the maturity date of the bonds or that the bonds
125-10   may be issued to mature serially over a specified number of years
125-11   not to exceed 40.  (V.A.C.S. Art. 703.)
125-12         Sec. 1251.003.  CONDUCT OF ELECTION.  (a)  The general
125-13   election laws govern the election except as provided by this
125-14   section.
125-15         (b)  The order for the election must include the location of
125-16   each polling place and the hours that the polls will be open.
125-17         (c)  The election shall be held not earlier than the 16th or
125-18   later than the 90th day after the date of the election order,
125-19   subject to Section 41.001(b), Election Code.
125-20         (d)  In addition to the notice required by Section 4.003(c),
125-21   Election Code, notice of the election shall be given by:
125-22               (1)  posting a substantial copy of the election order
125-23   at:
125-24                     (A)  three public places in the county or
125-25   municipality holding the election; and
125-26                     (B)  the county courthouse, if the election is a
125-27   county election, or the city hall, if the election is a municipal
 126-1   election; and
 126-2               (2)  publishing notice of the election in a newspaper
 126-3   of general circulation published in the county or municipality
 126-4   holding the election.
 126-5         (e)  The notice required by Subsection (d)(2) must be
 126-6   published on the same day in each of two successive weeks.  The
 126-7   first publication may not occur later than the 15th day before the
 126-8   date of the election.
 126-9         (f)  To the extent of a conflict between this section and a
126-10   municipal charter, this section controls.  (V.A.C.S. Art. 704.)
126-11         Sec. 1251.004.  IMPOSITION OF TAX.  At an election ordered on
126-12   the issuance of bonds of a county or municipality, or of a
126-13   political subdivision or defined district of a county or
126-14   municipality, the governing body of the county or municipality
126-15   shall also submit the question of whether to impose a tax on
126-16   property in the county, municipality, political subdivision, or
126-17   defined district to pay interest on the bonds and to provide a
126-18   sinking fund to redeem the bonds.  (V.A.C.S. Art. 702 (part).)
126-19         Sec. 1251.005.  BALLOT PROPOSITION.  At the election, the
126-20   ballots shall be printed to permit voting for or against the
126-21   proposition: "The issuance of bonds."  (V.A.C.S. Art. 705.)
126-22         Sec. 1251.006.  CERTAIN BONDS EXEMPTED.  (a)  Sections
126-23   1251.001, 1251.002, and 1251.004 do not apply to:
126-24               (1)  refunding bonds of a county or municipality; or
126-25               (2)  bonds issued in an amount less than $2,000 to
126-26   repair a building or structure that may be built using the proceeds
126-27   of bonds.
 127-1         (b)  If bonds described by Subsection (a)(2) are issued, the
 127-2   aggregate principal amount of those bonds may not exceed $2,000 in
 127-3   a calendar year.  (V.A.C.S. Art. 717.)
 127-4         CHAPTER 1252.  REVOCATION OF AUTHORITY TO ISSUE BONDS 
 127-5   Sec. 1252.001.  ELECTION TO REVOKE AUTHORITY
 127-6   Sec. 1252.002.  ELECTION PROCEDURE
 127-7   Sec. 1252.003.  REVOCATION AND CANCELLATION OF BONDS
 127-8         CHAPTER 1252.  REVOCATION OF AUTHORITY TO ISSUE BONDS 
 127-9         Sec. 1252.001.  ELECTION TO REVOKE AUTHORITY.  The
127-10   commissioners court of a county or the governing body of a
127-11   municipality may order an election to determine whether to revoke
127-12   the authority to issue bonds that:
127-13               (1)  compose all or part of an issue authorized by an
127-14   earlier election; and
127-15               (2)  have not as of the date of the order been sold or
127-16   delivered.  (V.A.C.S. Art. 717g, Sec. 1 (part).)
127-17         Sec. 1252.002.  ELECTION PROCEDURE.  (a)  An election to
127-18   revoke bonds under this chapter shall be held in the same manner as
127-19   the election originally authorizing the bonds.
127-20         (b)  In an election held under Subsection (a), the ballot
127-21   shall be printed to permit voting for or against the proposition:
127-22   "The revocation of bonds."
127-23         (c)  If a revocation election covers bonds of more than one
127-24   voted issue, there shall be a separate proposition for each voted
127-25   issue.  (V.A.C.S. Art. 717g, Sec. 1 (part).)
127-26         Sec. 1252.003.  REVOCATION AND CANCELLATION OF BONDS.  (a)
127-27   If the proposition to revoke the bonds receives the number of votes
 128-1   required by the statute under which the bonds were originally
 128-2   voted, the authority to issue the bonds is revoked.
 128-3         (b)  If the bonds have not been printed, a certified copy of
 128-4   the order or resolution showing that the authority to issue the
 128-5   bonds has been revoked and the minutes relating to the order or
 128-6   resolution shall be sent to the attorney general.
 128-7         (c)  If the bonds have been approved by the attorney general
 128-8   and registered by the comptroller, a certified copy of the order or
 128-9   resolution and the minutes relating to the order or resolution
128-10   shall be sent to the attorney general and comptroller.
128-11         (d)  If the bonds have been printed, the commissioners court
128-12   or municipal governing body shall destroy the bonds by canceling
128-13   and burning the bonds.  (V.A.C.S. Art. 717g, Sec. 2.)
128-14                   CHAPTER 1253.  BOND AND WARRANT LAW
128-15                    SUBCHAPTER A.  GENERAL PROVISIONS
128-16   Sec. 1253.001.  CONFLICT WITH MUNICIPAL CHARTER
128-17           (Sections 1253.002-1253.020 reserved for expansion)
128-18                SUBCHAPTER B.  FUNDING AND REFUNDING DEBT
128-19   Sec. 1253.021.  AUTHORITY TO FUND AND REFUND DEBT
128-20   Sec. 1253.022.  NOTICE OF INTENTION TO ISSUE BONDS
128-21   Sec. 1253.023.  PETITION AND ELECTION
128-22   Sec. 1253.024.  MATURITY
128-23   Sec. 1253.025.  IMPOSITION OF TAXES
128-24   Sec. 1253.026.  INVALIDITY OF CERTAIN BONDS
128-25   Sec. 1253.027.  EXCEPTION
128-26           (Sections 1253.028-1253.040 reserved for expansion)
128-27          SUBCHAPTER C.  PROVISIONS RELATING TO UTILITY SYSTEMS
 129-1   Sec. 1253.041.  UTILITY BONDS PAYABLE FROM REVENUE
 129-2   Sec. 1253.042.  MORTGAGE OF MUNICIPAL UTILITY SYSTEM
 129-3                   CHAPTER 1253.  BOND AND WARRANT LAW
 129-4                    SUBCHAPTER A.  GENERAL PROVISIONS
 129-5         Sec. 1253.001.  CONFLICT WITH MUNICIPAL CHARTER.  A right,
 129-6   power, or duty conferred or imposed on a municipality in regard to
 129-7   the issuance of a funding or refunding bond or warrant applies
 129-8   without regard to any provision in a municipal charter to the
 129-9   contrary.  (V.A.C.S. Art. 2368a, Sec. 10 (part).)
129-10           (Sections 1253.002-1253.020 reserved for expansion)
129-11                SUBCHAPTER B.  FUNDING AND REFUNDING DEBT
129-12         Sec. 1253.021.  AUTHORITY TO FUND AND REFUND DEBT.  (a)  The
129-13   commissioners court of a county or the governing body of a
129-14   municipality may, in accordance with this subchapter, adopt
129-15   necessary orders or ordinances to provide for funding or refunding
129-16   a legal debt of the county or municipality by:
129-17               (1)  canceling the evidence of debt; and
129-18               (2)  issuing to the holder or creditor a note, bond, or
129-19   treasury warrant.
129-20         (b)  Subject to applicable laws, a commissioners court or
129-21   governing body may, without providing notice and without being
129-22   subject to an election, issue a refunding bond to refund:
129-23               (1)  an outstanding bond; or
129-24               (2)  outstanding matured interest on an outstanding
129-25   bond.  (V.A.C.S. Art. 2368a, Secs. 1(a) (part); 7 (part), 7(a), (d)
129-26   (part).)
129-27         Sec. 1253.022.  NOTICE OF INTENTION TO ISSUE BONDS.  (a)  Not
 130-1   later than the 31st day before the date of a meeting at which a
 130-2   commissioners court or governing body proposes to issue funding
 130-3   bonds, the commissioners court or governing body shall publish
 130-4   notice of its intention to issue the bonds.
 130-5         (b)  The notice must:
 130-6               (1)  be published at least once a week for three
 130-7   consecutive weeks in a newspaper of general circulation in the
 130-8   county or municipality, as appropriate; and
 130-9               (2)  include a statement of the amount and purpose of
130-10   the proposed bonds.
130-11         (c)  If a newspaper is not published in the county or
130-12   municipality, the commissioners court or governing body may provide
130-13   the notice required by Subsection (a) by posting notice at the
130-14   courthouse door or at the city hall, as appropriate.  (V.A.C.S.
130-15   Art. 2368a, Sec. 7(d) (part).)
130-16         Sec. 1253.023.  PETITION AND ELECTION.  (a)  If, before the
130-17   funding bonds are authorized, the commissioners court or governing
130-18   body receives a petition requesting an election on the issuance of
130-19   the bonds that is signed by at least 10 percent of the registered
130-20   voters of the county or municipality, as applicable, who own
130-21   taxable property in the county or municipality, as shown by records
130-22   in the office of the county or municipal tax collector, the
130-23   commissioners court or governing body may not proceed to issue the
130-24   bonds.
130-25         (b)  A petition authorized by Subsection (a) must be filed
130-26   with the county clerk or the secretary or clerk of the
130-27   municipality.
 131-1         (c)  After a petition is filed, the commissioners court or
 131-2   governing body at its next meeting shall order an election to be
 131-3   held in the county or municipality to determine whether the funding
 131-4   bonds may be issued.  The commissioners court or governing body
 131-5   must hold the election in accordance with laws regulating elections
 131-6   for the issuance of other county or municipal bonds under Subtitles
 131-7   A, D, and E and this subtitle.
 131-8         (d)  If a majority of the qualified voters voting in the
 131-9   election approve the issuance of the funding bonds, the
131-10   commissioners court or governing body may issue the bonds.
131-11         (e)  If a petition seeking an election is not filed within
131-12   the specified period, an election is not required and the
131-13   commissioners court or governing body may proceed under Section
131-14   1253.021 to cancel or fund the debt described in the published
131-15   notice.  (V.A.C.S. Art. 2368a, Sec. 7(d) (part).)
131-16         Sec. 1253.024.  MATURITY.  Funding bonds may be issued
131-17   payable for a term exceeding 40 years only if the commissioners
131-18   court or governing body finds that the financial condition of the
131-19   county or municipality will not permit payment of bonds issued for
131-20   a term of 40 years or less from taxes that are imposed
131-21   substantially uniformly during the term of the bonds.  (V.A.C.S.
131-22   Art. 2368a, Sec. 7(d) (part).)
131-23         Sec. 1253.025.  IMPOSITION OF TAXES.  (a)  A commissioners
131-24   court or governing body shall:
131-25               (1)  impose taxes sufficient to pay interest as it
131-26   accrues and the principal as it matures on each bond issued in
131-27   accordance with this chapter and each time warrant issued under
 132-1   Chapter 252, Local Government Code; and
 132-2               (2)  except as provided by Subsection (b), comply with
 132-3   the duties imposed by Subtitles A, D, and E and this subtitle
 132-4   relating to the imposition of taxes.
 132-5         (b)  If a commissioners court or governing body imposes a tax
 132-6   that meets the requirements of Sections 5 and 7, Article XI, Texas
 132-7   Constitution, to pay principal and interest on a bond issued in
 132-8   accordance with this chapter or a time warrant issued under Chapter
 132-9   252, Local Government Code, the commissioners court or governing
132-10   body may subsequently issue a funding or refunding bond or warrant
132-11   to fund any bond or warrant, notwithstanding the fact that, because
132-12   of declining property values or another reason, the commissioners
132-13   court or governing body has insufficient taxing power available at
132-14   the time of issuance to pay the principal of and interest on the
132-15   funding or refunding bond or warrant.  (V.A.C.S.  Art. 2368a, Sec.
132-16   8.)
132-17         Sec. 1253.026.  INVALIDITY OF CERTAIN BONDS.  (a)  Except as
132-18   otherwise provided by law, a warrant bond, funding bond, refunding
132-19   bond, or other evidence of debt or obligation created or attempted
132-20   to be created by a commissioners court or governing body in
132-21   violation of this chapter is void.
132-22         (b)  A resident taxpayer of the county or municipality, as
132-23   applicable, may bring suit in the county to enjoin payment of the
132-24   bond or evidence of debt or obligation.  (V.A.C.S. Art. 2368a, Sec.
132-25   9 (part).)
132-26         Sec. 1253.027.  EXCEPTION.  Notwithstanding any provision in
132-27   this subchapter, a commissioners court or governing body may at any
 133-1   time, without providing notice or being subject to an election,
 133-2   fund or refund any item of debt created in accordance with this
 133-3   chapter to prevent or cure a default or impending default in the
 133-4   payment of principal or interest.  (V.A.C.S. Art. 2368a, Sec.  7(d)
 133-5   (part).)
 133-6           (Sections 1253.028-1253.040 reserved for expansion)
 133-7          SUBCHAPTER C.  PROVISIONS RELATING TO UTILITY SYSTEMS
 133-8         Sec. 1253.041.  UTILITY BONDS PAYABLE FROM REVENUE.  (a)  A
 133-9   municipality that has issued a bond, warrant, certificate, or other
133-10   public security payable from the revenue and income of a utility
133-11   owned by the municipality may fund, refund, or extend the public
133-12   security without complying with the election requirements of this
133-13   chapter if the funding, refunding, or extension does not increase
133-14   the amount of the municipality's debt, taking into consideration
133-15   interest adjustments.
133-16         (b)  A public security funded, refunded, or extended under
133-17   this section may not be charged against money raised by the
133-18   municipality through taxation.  (V.A.C.S. Art. 2368a, Sec. 8a.)
133-19         Sec. 1253.042.  MORTGAGE OF MUNICIPAL UTILITY SYSTEM.  (a)  A
133-20   municipality is not prohibited by this chapter or Chapter 252,
133-21   Local Government Code, from encumbering the municipality's light,
133-22   water, or sewer system or other utility or anything relating to the
133-23   system, including a franchise and franchise income, to secure the
133-24   payment of money used to purchase the system or to make or purchase
133-25   an extension, addition, or improvement to the system under:
133-26               (1)  Subchapter B, Chapter 1502;
133-27               (2)  the municipality's charter; or
 134-1               (3)  Section 402.002, Local Government Code.
 134-2         (b)  The governing body of a municipality that authorizes a
 134-3   contract, agreement, or encumbrance relating to a municipal utility
 134-4   system, and that issues a revenue bond, warrant, or other
 134-5   obligation to be paid from the property and income of the system,
 134-6   shall comply with this chapter and Chapter 252, Local Government
 134-7   Code, with regard to:
 134-8               (1)  notice;
 134-9               (2)  competitive bids, except as provided by Subsection
134-10   (c); and
134-11               (3)  the right to an election.
134-12         (c)  A municipality that proposes to acquire an existing
134-13   utility plant is not required to seek competitive bids, but voters
134-14   in the municipality are entitled to an election in accordance with
134-15   this chapter only on the question of whether the plant should be
134-16   purchased.  (V.A.C.S. Art. 2368a, Sec. 11.)
134-17               (Chapters 1254-1300 reserved for expansion)
134-18            SUBTITLE D.  PROVISIONS APPLICABLE TO SECURITIES
134-19                           ISSUED BY COUNTIES
134-20                       CHAPTER 1301.  COUNTY BONDS
134-21   Sec. 1301.001.  ISSUANCE AND AUTHORIZATION
134-22   Sec. 1301.002.  SIGNATURES; REGISTRATION BY COUNTY TREASURER
134-23   Sec. 1301.003.  LIMITS ON ISSUANCE OF BONDS
134-24   Sec. 1301.004.  PAYMENT OF INTEREST AND CREATION OF SINKING
134-25                     FUND
134-26                       CHAPTER 1301.  COUNTY BONDS
134-27         Sec. 1301.001.  ISSUANCE AND AUTHORIZATION.  (a)  The
 135-1   commissioners court of a county may issue bonds authorized under
 135-2   Subtitle A and Chapter 1251 to:
 135-3               (1)  build a county courthouse or jail;
 135-4               (2)  purchase suitable sites in the county and to
 135-5   construct buildings on the sites for homes or schools for dependent
 135-6   or delinquent children;
 135-7               (3)  establish county facilities for needy or indigent
 135-8   persons in the county;
 135-9               (4)  purchase and construct bridges for public purposes
135-10   in the county or to cross a stream serving as the county's boundary
135-11   line; or
135-12               (5)  improve and maintain the public roads in the
135-13   county.
135-14         (b)  The commissioners court may issue bonds only if a
135-15   majority of the voters at an election to authorize bonds vote in
135-16   favor of the proposition to authorize the bonds.
135-17         (c)  Bonds to purchase or construct a bridge and to improve
135-18   and maintain a public road may be submitted by the commissioners
135-19   court and voted on as one proposition.  (V.A.C.S. Arts. 718, 719.)
135-20         Sec. 1301.002.  SIGNATURES; REGISTRATION BY COUNTY TREASURER.
135-21   (a)  Before delivery, a bond issued under this chapter must be:
135-22               (1)  signed by the county judge;
135-23               (2)  countersigned by the county clerk; and
135-24               (3)  registered by the county treasurer.
135-25         (b)  The county treasurer shall keep an account of the amount
135-26   of principal and interest paid on each bond.  (V.A.C.S. Art. 724
135-27   (part).)
 136-1         Sec. 1301.003.  LIMITS ON ISSUANCE OF BONDS.  (a)  The
 136-2   amounts of bonds issued under this chapter may not exceed:
 136-3               (1)  for courthouse bonds, two percent of the county's
 136-4   taxable values;
 136-5               (2)  for jail bonds, 1-1/2 percent of the county's
 136-6   taxable values;
 136-7               (3)  for joint courthouse and jail bonds, 3-1/2 percent
 136-8   of the county's taxable values; and
 136-9               (4)  for bridge bonds, 1-1/2 percent of the county's
136-10   taxable values.
136-11         (b)  In determining the amount of the respective type of
136-12   bonds to be issued, previous debt incurred for the same purpose as
136-13   the bonds shall be considered.
136-14         (c)  A county's total indebtedness for the purposes described
136-15   by this chapter may not be increased by the issuance of bonds to an
136-16   amount that exceeds five percent of the county's taxable values.
136-17         (d)  The county's taxable values are according to the most
136-18   recent appraisal roll.  (V.A.C.S. Art. 722.)
136-19         Sec. 1301.004.  PAYMENT OF INTEREST AND CREATION OF SINKING
136-20   FUND.  (a)  Taxes imposed to pay the interest on bonds issued under
136-21   this chapter and to create a sinking fund for the redemption of
136-22   those bonds may not exceed:
136-23               (1)  25 cents per $100 valuation for courthouse or jail
136-24   bonds; and
136-25               (2)  15 cents per $100 valuation for bridge or road and
136-26   bridge bonds.
136-27         (b)  If the principal of and all interest on bonds issued
 137-1   under this chapter are fully paid and a surplus not exceeding
 137-2   $1,000 remains in the sinking fund, the surplus may be used by the
 137-3   county to maintain and repair the courthouse, jail, roads, or
 137-4   bridges of the county, as determined by the commissioners court.
 137-5   (V.A.C.S. Art. 723.)
 137-6              CHAPTER 1302.  DESTRUCTION OF COUNTY SECURITY
 137-7   Sec. 1302.001.  DEFINITION
 137-8   Sec. 1302.002.  AUTHORIZATION
 137-9   Sec. 1302.003.  LIMITATION
137-10              CHAPTER 1302.  DESTRUCTION OF COUNTY SECURITY
137-11         Sec. 1302.001.  DEFINITION.  In this chapter, "county
137-12   security" means a certificate, bond, interest coupon, or other
137-13   evidence of indebtedness issued by a county.  (V.A.C.S. Art. 717l-1
137-14   (part).)
137-15         Sec. 1302.002.  AUTHORIZATION.  The commissioners court of a
137-16   county may contract with the county's depository or another entity
137-17   that acts as the registrar or paying agent for a county security
137-18   issued by the county for the destruction of a county security that
137-19   has been issued and paid by the county.  (V.A.C.S. Art. 717l-1
137-20   (part).)
137-21         Sec. 1302.003.  LIMITATION.  A contract under Section
137-22   1302.002 may not authorize the destruction of a county security
137-23   before:
137-24               (1)  the first anniversary of the date the county
137-25   security is paid; or
137-26               (2)  the end of the third month after the date the
137-27   depository, registrar, or paying agent files a list identifying the
 138-1   county security to be destroyed with the commissioners court or
 138-2   county treasurer.  (V.A.C.S. Art. 717l-1 (part).)
 138-3               (Chapters 1303-1330 reserved for expansion)
 138-4            SUBTITLE E.  PROVISIONS APPLICABLE TO SECURITIES
 138-5                        ISSUED BY MUNICIPALITIES
 138-6                     CHAPTER 1331.  MUNICIPAL BONDS
 138-7                    SUBCHAPTER A.  GENERAL PROVISIONS
 138-8   Sec. 1331.001.  AUTHORITY OF MUNICIPALITY TO ISSUE BONDS
 138-9   Sec. 1331.002.  SIGNATURES OF MAYOR AND MUNICIPAL SECRETARY
138-10           (Sections 1331.003-1331.050 reserved for expansion)
138-11     SUBCHAPTER B.  PROVISIONS APPLICABLE TO CERTAIN MUNICIPALITIES
138-12   Sec. 1331.051.  LIMITATION ON BONDED DEBT:  MUNICIPALITY
138-13                     WITH POPULATION OF 600,000 OR MORE
138-14   Sec. 1331.052.  AUTHORITY OF HOME-RULE MUNICIPALITY TO ISSUE
138-15                     BONDS
138-16   Sec. 1331.053.  BOND SALE ADVERTISEMENT BY CERTAIN
138-17                     HOME-RULE MUNICIPALITIES
138-18           (Sections 1331.054-1331.100 reserved for expansion)
138-19         SUBCHAPTER C.  FUNDING, COMPROMISE, AND LIQUIDATION OF
138-20                         DEBT BY MUNICIPALITIES
138-21   Sec. 1331.101.  FUNDING OF MUNICIPAL DEBT
138-22   Sec. 1331.102.  COMPROMISING DEBT OF MUNICIPALITY
138-23   Sec. 1331.103.  LIQUIDATION BOARD
138-24   Sec. 1331.104.  SELECTION OF DEPOSITORY BY LIQUIDATION
138-25                     BOARD
138-26   Sec. 1331.105.  DEPOSIT OF TAX PROCEEDS WITH DEPOSITORY
138-27   Sec. 1331.106.  CONTROL AND APPLICATION OF MONEY IN
 139-1                     DEPOSITORY
 139-2   Sec. 1331.107.  PAYMENT OF EXPENSES BY BOARD; REPORTS
 139-3   Sec. 1331.108.  LIMIT ON DEFENSES TO SUIT
 139-4   Sec. 1331.109.  AUTHORITY TO COMPROMISE DEBT UNDER
 139-5                     CERTAIN OTHER LAW
 139-6   Sec. 1331.110.  EXEMPTION FROM MUNICIPAL TAXATION
 139-7                     CHAPTER 1331.  MUNICIPAL BONDS
 139-8                    SUBCHAPTER A.  GENERAL PROVISIONS
 139-9         Sec. 1331.001.  AUTHORITY OF MUNICIPALITY TO ISSUE BONDS.  A
139-10   municipality may issue bonds payable from ad valorem taxes with one
139-11   or more interest coupons in the amount it considers expedient to:
139-12               (1)  construct or purchase permanent improvements
139-13   inside the municipal boundaries, including public buildings,
139-14   waterworks, or sewers;
139-15               (2)  construct or improve the streets and bridges of
139-16   the municipality; or
139-17               (3)  construct or purchase building sites or buildings
139-18   for the public schools and other institutions of learning inside
139-19   the municipality, if the municipality has assumed exclusive control
139-20   of those schools and institutions.  (V.A.C.S. Art. 823 (part).)
139-21         Sec. 1331.002.  SIGNATURES OF MAYOR AND MUNICIPAL SECRETARY.
139-22   A bond issued by a municipality under Section 1331.001 must be
139-23   signed by the mayor and countersigned by the municipal secretary.
139-24   (V.A.C.S. Art. 825.)
139-25           (Sections 1331.003-1331.050 reserved for expansion)
139-26     SUBCHAPTER B.  PROVISIONS APPLICABLE TO CERTAIN MUNICIPALITIES
139-27         Sec. 1331.051.  LIMITATION ON BONDED DEBT: MUNICIPALITY WITH
 140-1   POPULATION OF 600,000 OR MORE.  (a)  This section applies only to a
 140-2   municipality with a population of 600,000 or more.
 140-3         (b)  The municipality, through the issuance of bonds payable
 140-4   from taxes, may incur total bonded debt in an amount not to exceed
 140-5   10 percent of the total appraised value of property listed on the
 140-6   most recent appraisal roll for the municipality notwithstanding
 140-7   that the municipal charter limits the total dollar amount of bonded
 140-8   debt to a lesser amount.  (V.A.C.S. Art. 835p.)
 140-9         Sec. 1331.052.  AUTHORITY OF HOME-RULE MUNICIPALITY TO ISSUE
140-10   BONDS.  (a)  A home-rule municipality may issue bonds on the credit
140-11   of the municipality to make permanent public improvements or for
140-12   another public purpose in the amount and to the extent provided by
140-13   its charter.
140-14         (b)  A home-rule municipality may not issue bonds under this
140-15   section unless the bonds have been authorized by a majority of the
140-16   qualified voters of the municipality voting at an election held for
140-17   that purpose.
140-18         (c)  If a municipality was authorized under a special charter
140-19   granted before June 30, 1913, to issue bonds, this section may not
140-20   be construed as interfering with the issuance of bonds under that
140-21   charter.  (V.A.C.S. Art. 1175 (part).)
140-22         Sec. 1331.053.  BOND SALE ADVERTISEMENT BY CERTAIN HOME-RULE
140-23   MUNICIPALITIES.  To receive competitive bids on the interest rate
140-24   paid and the amount of the premium, the governing body of a
140-25   municipality the charter of which requires that municipal bonds be
140-26   advertised for sale after the bonds have been authorized and issued
140-27   must advertise the bonds for sale and receive bids for the sale
 141-1   before adopting an ordinance authorizing the issuance of the bonds.
 141-2   (V.A.C.S. Art. 709c.)
 141-3           (Sections 1331.054-1331.100 reserved for expansion)
 141-4         SUBCHAPTER C.  FUNDING, COMPROMISE, AND LIQUIDATION OF
 141-5                         DEBT BY MUNICIPALITIES
 141-6         Sec. 1331.101.  FUNDING OF MUNICIPAL DEBT.  The governing
 141-7   body of a municipality by ordinance shall provide that any debt of
 141-8   the municipality may be funded by:
 141-9               (1)  canceling the evidences of the debt; and
141-10               (2)  issuing notes, bonds, or treasury warrants, with
141-11   or without coupons, to the holders or creditors. (V.A.C.S.
141-12   Art. 827.)
141-13         Sec. 1331.102.  COMPROMISING DEBT OF MUNICIPALITY.  (a)  The
141-14   governing body of a municipality, by resolution or ordinance and by
141-15   referring to and adopting this subchapter, may compromise and fund
141-16   as provided by this section:
141-17               (1)  any valid debt, whether bonded or floating, issued
141-18   by the municipality; and
141-19               (2)  the coupons due on the bonded debt.
141-20         (b)  The governing body may issue new bonds that are to
141-21   mature over a specified number of years, not to exceed 30.
141-22         (c)  A compromise may not be made under which a debt barred
141-23   by a statute of limitations is funded.  (V.A.C.S. Arts. 828, 829.)
141-24         Sec. 1331.103.  LIQUIDATION BOARD.  (a)  If the governing
141-25   body of a municipality compromises a debt under this subchapter,
141-26   and bonds are delivered to the creditors, a liquidation board
141-27   consisting of five reputable residents of the municipality shall be
 142-1   promptly appointed and organized.
 142-2         (b)  The mayor of the municipality, the governing body of the
 142-3   municipality, the governor, any district judge of the district in
 142-4   which the municipality is located, and the holders of the debt or a
 142-5   majority of the holders shall each appoint one member to the board.
 142-6   An appointing authority shall appoint a new member to fill a
 142-7   vacancy in its appointee's position.
 142-8         (c)  If an appointing authority fails to appoint a member to
 142-9   the board or a new member to fill a vacancy, any one or more of the
142-10   holders of the debt may apply to a district court of the judicial
142-11   district in which the municipality is located, or to the judge of
142-12   the court in vacation, for the appointment.  The court or judge, on
142-13   the application, shall make the appointment.
142-14         (d)  A member of the board:
142-15               (1)  serves without compensation; and
142-16               (2)  serves a term of four years.  (V.A.C.S. Art. 830
142-17   (part).)
142-18         Sec. 1331.104.  SELECTION OF DEPOSITORY BY LIQUIDATION BOARD.
142-19   (a)  The liquidation board shall:
142-20               (1)  select a solvent depository for money under the
142-21   control of the board; and
142-22               (2)  give the assessor and collector of taxes for the
142-23   municipality written notice, signed by the board, of the selection
142-24   of the depository.
142-25         (b)  The liquidation board is responsible for the
142-26   depository's acts in regard to those deposits.  (V.A.C.S. Art. 831
142-27   (part).)
 143-1         Sec. 1331.105.  DEPOSIT OF TAX PROCEEDS WITH DEPOSITORY.  (a)
 143-2   The assessor and collector for the municipality shall deposit with
 143-3   the selected depository at the close of business each day one-half
 143-4   of all money collected by the assessor and collector during the
 143-5   preceding 24 hours attributable to any tax levied by the
 143-6   municipality.  The depository's receipt for that money is an
 143-7   acquittance of the assessor and collector.
 143-8         (b)  The assessor and collector is liable on that official's
 143-9   official bond for a failure to promptly make a deposit required by
143-10   Subsection (a) and for an additional 10 percent each month of that
143-11   amount as a penalty.  The liquidation board:
143-12               (1)  is entitled to recover those amounts in a suit;
143-13   and
143-14               (2)  shall promptly institute the suit.
143-15         (c)  When the total amount deposited under this section
143-16   equals the amount of annual interest on bonds issued under Section
143-17   1331.102(b), the assessor and collector may discontinue the
143-18   deposits required by Subsection (a) until the liquidation board
143-19   gives the assessor and collector written notice that the amount on
143-20   deposit is less than the amount of annual interest on the bonds.
143-21   (V.A.C.S. Art. 831 (part).)
143-22         Sec. 1331.106.  CONTROL AND APPLICATION OF MONEY IN
143-23   DEPOSITORY.  (a)  The liquidation board controls the amount on
143-24   deposit with the depository.  The liquidation board shall apply the
143-25   amount on deposit by paying, in the following order of priority:
143-26               (1)  interest on bonds issued under Section 1331.102(b)
143-27   as they mature;
 144-1               (2)  the principal of those bonds;
 144-2               (3)  interest on any valid bonds issued by the
 144-3   municipality under another law; and
 144-4               (4)  the principal of bonds described by Subdivision
 144-5   (3) as they mature.
 144-6         (b)  The members of the liquidation board are liable for:
 144-7               (1)  the prompt payment of interest, out of the amount
 144-8   on deposit with the depository; and
 144-9               (2)  an additional 10 percent of the amount of that
144-10   interest as damages to be recovered by any person aggrieved by a
144-11   failure of the board to promptly pay the interest.
144-12         (c)  If there is an amount on deposit with the depository
144-13   sufficient to pay two percent of the principal of the bonds in
144-14   addition to one year's interest, the liquidation board shall use
144-15   the amount to purchase outstanding bonds as provided by law.  The
144-16   purchased bonds shall be returned to the governing body of the
144-17   municipality with all coupons that have been paid.  (V.A.C.S.
144-18   Art. 831 (part).)
144-19         Sec. 1331.107.  PAYMENT OF EXPENSES BY BOARD; REPORTS.  The
144-20   liquidation board shall:
144-21               (1)  pay, out of the amount on deposit with the
144-22   depository under this subchapter, the board's expenses incurred in
144-23   advertising for purchasers of bonds; and
144-24               (2)  make semiannual reports to the governing body of
144-25   the municipality of the board's acts and of all receipts and
144-26   disbursements of money under the board's control.  (V.A.C.S.
144-27   Art. 831 (part).)
 145-1         Sec. 1331.108.  LIMIT ON DEFENSES TO SUIT.  In a suit against
 145-2   a municipality in a court of this state to enforce payment of a new
 145-3   bond issued under this subchapter or an interest coupon on the
 145-4   bond, the court may consider only a legal or equitable defense that
 145-5   originated on or after the issuance of the new bond.  (V.A.C.S.
 145-6   Art. 832 (part).)
 145-7         Sec. 1331.109.  AUTHORITY TO COMPROMISE DEBT UNDER CERTAIN
 145-8   OTHER LAW.  In the manner prescribed by the provisions of Subtitles
 145-9   A, C, D, and E that confer authority on counties and municipalities
145-10   to compromise and liquidate their debt and issue bonds for that
145-11   debt, a municipality may:
145-12               (1)  compromise and liquidate the municipality's debt;
145-13   and
145-14               (2)  issue bonds for that debt.  (V.A.C.S. Art. 834.)
145-15         Sec. 1331.110.  EXEMPTION FROM MUNICIPAL TAXATION.  A new
145-16   bond issued under this subchapter is exempt from any tax imposed by
145-17   the municipality.  (V.A.C.S. Art. 833 (part).)
145-18    CHAPTER 1332.  USE OF MUNICIPAL BOND PROCEEDS FOR OTHER PURPOSES
145-19   Sec. 1332.001.  USE OF UNSPENT BOND PROCEEDS FOR OTHER
145-20                     PURPOSES
145-21   Sec. 1332.002.  ELECTION
145-22    CHAPTER 1332.  USE OF MUNICIPAL BOND PROCEEDS FOR OTHER PURPOSES
145-23         Sec. 1332.001.  USE OF UNSPENT BOND PROCEEDS FOR OTHER
145-24   PURPOSES.  The governing body of a municipality may use the
145-25   proceeds of municipal bonds that have been sold and delivered for a
145-26   specific purpose for a purpose other than the specific purpose if:
145-27               (1)  the specific purpose is accomplished by other
 146-1   means or is abandoned;
 146-2               (2)  the proceeds are unspent; and
 146-3               (3)  a majority of the votes cast in an election held
 146-4   in the municipality approve the use of the proceeds for the
 146-5   proposed purpose.  (V.A.C.S. Art. 703b (part).)
 146-6         Sec. 1332.002.  ELECTION.  (a)  The election order and the
 146-7   notice of election must state the proposed purpose for which the
 146-8   bond proceeds are to be used.
 146-9         (b)  A municipality shall hold the election in the same
146-10   manner as an election to issue bonds in the municipality.
146-11   (V.A.C.S. Art. 703b (part).)
146-12           CHAPTER 1333.  REVOCATION OF UNSOLD MUNICIPAL BONDS
146-13                               BY PETITION
146-14   Sec. 1333.001.  BOND REVOCATION ELECTION REQUIRED
146-15   Sec. 1333.002.  BALLOT FORM
146-16   Sec. 1333.003.  ELECTION RESULTS; DESTRUCTION OF BONDS
146-17   Sec. 1333.004.  TAX ADJUSTMENT FOLLOWING REVOCATION
146-18           CHAPTER 1333.  REVOCATION OF UNSOLD MUNICIPAL BONDS
146-19                               BY PETITION
146-20         Sec. 1333.001.  BOND REVOCATION ELECTION REQUIRED.  (a)  The
146-21   governing body of a municipality shall order an election to
146-22   determine whether to revoke bonds unsold for 10 years or more after
146-23   the date the bonds are authorized to be issued if the governing
146-24   body receives a petition signed by a number of registered property
146-25   tax paying voters equal to 10 percent of the property tax paying
146-26   voters voting in the most recent municipal election.
146-27         (b)  The election shall be held on the first authorized
 147-1   uniform election date prescribed by Chapter 41, Election Code, that
 147-2   allows sufficient time for compliance with any requirements
 147-3   established by law.
 147-4         (c)  A municipality shall hold the election in the same
 147-5   manner as an election to issue bonds in the municipality.
 147-6   (V.A.C.S. Art. 705a, Sec. 1 (part).)
 147-7         Sec. 1333.002.  BALLOT FORM.  At the election, the ballots
 147-8   shall be printed to permit voting for or against the following
 147-9   proposition:  "The revocation of the bonds."  (V.A.C.S.  Art. 705a,
147-10   Sec. 1 (part).)
147-11         Sec. 1333.003.  ELECTION RESULTS; DESTRUCTION OF BONDS.  (a)
147-12   The governing body of the municipality shall record the results of
147-13   an election held under this chapter in its minutes.
147-14         (b)  If a majority of the qualified voters voting at the
147-15   election vote in favor of the proposition, the governing body of
147-16   the municipality shall revoke and burn the unsold bonds.
147-17         (c)  The municipality shall send to the comptroller a
147-18   certified copy of the minutes of the municipality showing the
147-19   revocation and destruction of the bonds.
147-20         (d)  On receipt of notice under Subsection (c), the
147-21   comptroller shall cancel the registration of the bonds in the
147-22   records of the comptroller.  (V.A.C.S.  Art. 705a, Sec. 2.)
147-23         Sec. 1333.004.  TAX ADJUSTMENT FOLLOWING REVOCATION.  (a)
147-24   The governing body of a municipality that revokes bonds under this
147-25   chapter shall adjust the tax rate in the municipality to account
147-26   for any change caused by the revocation.
147-27         (b)  The municipality by order shall refund taxes collected
 148-1   for payment of bonds revoked under this chapter, less any properly
 148-2   chargeable claims, ratably to the taxpayers.
 148-3         (c)  The treasurer of the municipality shall keep a receipt
 148-4   of taxes refunded under Subsection (b).  (V.A.C.S. Art. 705a, Secs.
 148-5   3, 4.)
 148-6               (Chapters 1334-1370 reserved for expansion)
 148-7           SUBTITLE F.  SPECIFIC AUTHORITY FOR STATE OR LOCAL
 148-8                     GOVERNMENT TO ISSUE SECURITIES
 148-9       CHAPTER 1371.  OBLIGATIONS FOR CERTAIN PUBLIC IMPROVEMENTS
148-10                    SUBCHAPTER A.  GENERAL PROVISIONS
148-11   Sec. 1371.001.  DEFINITIONS
148-12   Sec. 1371.002.  CONSTRUCTION
148-13   Sec. 1371.003.  RELATIONSHIP TO OTHER LAW
148-14           (Sections 1371.004-1371.050 reserved for expansion)
148-15           SUBCHAPTER B.  ISSUANCE AND APPROVAL OF OBLIGATION
148-16   Sec. 1371.051.  AUTHORITY TO ISSUE OBLIGATION
148-17   Sec. 1371.052.  TRANSPORTATION AUTHORITY OBLIGATION;
148-18                     ELECTION
148-19   Sec. 1371.053.  OBLIGATION AUTHORIZATION
148-20   Sec. 1371.054.  RATE OF INTEREST
148-21   Sec. 1371.055.  EXECUTION OF OBLIGATION
148-22   Sec. 1371.056.  AUTHORITY TO ENTER INTO AND EXECUTE
148-23                     CREDIT AGREEMENTS
148-24   Sec. 1371.057.  REVIEW AND APPROVAL OF OBLIGATION, CREDIT
148-25                     AGREEMENT, AND CONTRACT BY ATTORNEY
148-26                     GENERAL
148-27   Sec. 1371.058.  REFINANCING, RENEWAL, OR REFUNDING OF
 149-1                     OBLIGATION OR CREDIT AGREEMENT
 149-2           (Sections 1371.059-1371.100 reserved for expansion)
 149-3             SUBCHAPTER C.  FINANCIAL ASPECTS OF OBLIGATION
 149-4   Sec. 1371.101.  OBLIGATION AS NEGOTIABLE INSTRUMENT AND
 149-5                     INVESTMENT SECURITY
 149-6   Sec. 1371.102.  USE OF CERTAIN PROCEEDS
 149-7   Sec. 1371.103.  SECURITY FOR OBLIGATION
 149-8   Sec. 1371.104.  SOURCE OF REPAYMENT OF OBLIGATION
 149-9   Sec. 1371.105.  PLEDGE OR LIEN ON RESOURCES, ASSETS,
149-10                     OR FUND OF ISSUER
149-11   Sec. 1371.106.  PLEDGE OF OR LIEN ON SALES OR USE TAX
149-12                     REVENUE
149-13       CHAPTER 1371.  OBLIGATIONS FOR CERTAIN PUBLIC IMPROVEMENTS
149-14                    SUBCHAPTER A.  GENERAL PROVISIONS
149-15         Sec. 1371.001.  DEFINITIONS.  In this chapter:
149-16               (1)  "Credit agreement" means a loan agreement,
149-17   revolving credit agreement, agreement establishing a line of
149-18   credit, letter of credit, reimbursement agreement, insurance
149-19   contract, commitment to purchase an obligation, purchase or sale
149-20   agreement, interest rate swap agreement, or commitment or other
149-21   agreement authorized and approved by a governing body in connection
149-22   with the authorization, issuance, security, exchange, payment,
149-23   purchase, or redemption of an obligation, interest on an
149-24   obligation, or both, or as otherwise authorized by this chapter.
149-25               (2)  "Eligible project" means:
149-26                     (A)  the acquisition or construction of or an
149-27   improvement, addition, or extension to a public works, including a
 150-1   capital asset or facility incident and related to the operation,
 150-2   maintenance, or administration of the public works, and:
 150-3                           (i)  with respect to a property or a
 150-4   facility for the generation of electric power and energy, fuel
 150-5   acquisition or the development or transportation of power, energy,
 150-6   or fuel;
 150-7                           (ii)  with respect to a property or a
 150-8   facility for a public transportation system:
 150-9                                          (a)  a building, terminal,
150-10   garage, shop, or other structure, rolling stock, equipment, or
150-11   another facility for mass public transportation; or
150-12                                          (b)  a vehicle parking area
150-13   or a facility necessary or convenient for the beneficial use and
150-14   access of persons and vehicles to a station, terminal, yard, car,
150-15   or bus, or for the protection or environmental enhancement of a
150-16   facility for mass public transportation; and
150-17                           (iii)  with respect to a property or a
150-18   facility for  a port facility, a wharf or dock, a warehouse, grain
150-19   elevator, or other storage facility, a bunkering facility,
150-20   port-related railroad or bridge, floating plant or facility,
150-21   lightering facility, cargo handling facility, towing facility, or
150-22   any other facility or aid incident to or useful in the operation of
150-23   a port facility;
150-24                     (B)  a causeway, bridge, tunnel, turnpike,
150-25   highway, or combination of those facilities, including:
150-26                           (i)  a necessary overpass, underpass,
150-27   interchange, entrance plaza, tollhouse, service station, approach,
 151-1   fixture, accessory, or item of equipment, or a storage,
 151-2   administration, or other necessary building; and
 151-3                           (ii)  a property right or other interest
 151-4   acquired in connection with those facilities;
 151-5                     (C)  a public improvement owned by a county that
 151-6   serves the purpose of attracting visitors and tourists to the
 151-7   county, including a civic center, auditorium, exhibition hall,
 151-8   coliseum, stadium, or parking area;
 151-9                     (D)  a project for which there exists authorized
151-10   but unissued obligations approved by a majority of the voters of
151-11   the issuer, including obligations payable from ad valorem taxes; or
151-12                     (E)  a project for which an issuer is authorized
151-13   to issue revenue bonds secured, in whole or in part, by revenue
151-14   derived from or related to student loans.
151-15               (3)  "Governing body" means the board, council,
151-16   commission, commissioners court, or other designated body, acting
151-17   individually or jointly as authorized by law, that is authorized by
151-18   law to issue public securities for or on behalf of an issuer.
151-19               (4)  "Issuer" means:
151-20                     (A)  a home-rule municipality that:
151-21                           (i)  adopted its charter under Section 5,
151-22   Article XI, Texas Constitution;
151-23                           (ii)  has a population of 90,000 or more;
151-24   and
151-25                           (iii)  has outstanding long-term
151-26   indebtedness secured by the revenue of the public works for which
151-27   an obligation is being issued that is rated by a nationally
 152-1   recognized rating agency for municipal securities in one of the
 152-2   four highest rating categories for a long-term obligation;
 152-3                     (B)  a conservation and reclamation district
 152-4   created and organized as a river authority under Section 52,
 152-5   Article III, or Section 59, Article XVI, Texas Constitution;
 152-6                     (C)  a joint powers agency organized and
 152-7   operating under Chapter 163, Utilities Code;
 152-8                     (D)  a metropolitan rapid transit authority or
 152-9   regional transportation authority created, organized, and operating
152-10   under Chapter 451 or 452, Transportation Code;
152-11                     (E)  a conservation and reclamation district
152-12   organized or operating as a navigation district under Section 52,
152-13   Article III, or Section 59, Article XVI, Texas Constitution;
152-14                     (F)  a district organized or operating under
152-15   Section 59, Article XVI, Texas Constitution, that has all or part
152-16   of two or more municipalities within its boundaries;
152-17                     (G)  a state agency, including a state
152-18   institution of higher education;
152-19                     (H)  a hospital authority created or operating
152-20   under Chapter 262 or 264, Health and Safety Code, in a county that:
152-21                           (i)  has a population of more than two
152-22   million; or
152-23                           (ii)  is included, in whole or in part, in
152-24   a standard metropolitan statistical area of this state that
152-25   includes a county with a population of more than 1.8 million;
152-26                     (I)  a nonprofit corporation organized to
152-27   exercise the powers of a higher education authority under Section
 153-1   53.47(e), Education Code; or
 153-2                     (J)  a county with a population of two million or
 153-3   more.
 153-4               (5)  "Obligation" means a note, warrant, or other
 153-5   special obligation authorized to be issued by an issuer under this
 153-6   chapter or a public security as defined by Section 1201.002 that,
 153-7   before delivery, is rated by a nationally recognized rating agency
 153-8   for municipal securities in one of the three highest rating
 153-9   categories for a short-term debt instrument or one of the four
153-10   highest rating categories for a long-term debt instrument.
153-11               (6)  "Obligation authorization" means a resolution,
153-12   order, or ordinance of a governing body authorizing the issuance of
153-13   an obligation.
153-14               (7)  "Project cost" means a cost or expense incurred in
153-15   relation to an eligible project.  The term includes:
153-16                     (A)  design, planning, engineering, and legal
153-17   cost;
153-18                     (B)  acquisition cost of land or an interest in
153-19   land;
153-20                     (C)  construction cost;
153-21                     (D)  cost of machinery, equipment, and other
153-22   capital assets incident and related to the operation, maintenance,
153-23   and administration of an eligible project; and
153-24                     (E)  financing cost, including:
153-25                           (i)  interest during and after
153-26   construction;
153-27                           (ii)  underwriter's discount or fee; and
 154-1                           (iii)  cost of legal, financial, and other
 154-2   professional services.
 154-3               (8)  "Public works" means property or a facility for:
 154-4                     (A)  the conservation, storage, supply,
 154-5   treatment, or transmission of water;
 154-6                     (B)  the treatment, collection, or disposal of
 154-7   water-carried wastes or solid wastes;
 154-8                     (C)  the generation, transmission, or
 154-9   distribution of electric power and energy;
154-10                     (D)  the acquisition, distribution, or storage of
154-11   gas;
154-12                     (E)  a public transportation system as defined by
154-13   Chapter 452, Transportation Code;
154-14                     (F)  an airport as defined by Section 22.001,
154-15   Transportation Code;
154-16                     (G)  a port facility, including a facility for
154-17   the operation or development of a port or waterway or in aid of
154-18   navigation or navigation-related commerce in a port or on a
154-19   waterway;
154-20                     (H)  a project as defined by Section 284.001,
154-21   Transportation Code; or
154-22                     (I)  the carrying out of a purpose or function
154-23   for which an issuer may issue public securities.   (V.A.C.S.
154-24   Art. 717q, Secs. 1(1), (2), (3), (4) (part), (5), (6), (7); New.)
154-25         Sec. 1371.002.  CONSTRUCTION.  This chapter shall be
154-26   liberally construed to achieve the legislative intent and purposes
154-27   of this chapter.  A power granted by this chapter shall be broadly
 155-1   interpreted to achieve that intent and those purposes.  (V.A.C.S.
 155-2   Art. 717q, Sec. 8.)
 155-3         Sec. 1371.003.  RELATIONSHIP TO OTHER LAW.  (a)  This chapter
 155-4   is wholly sufficient authority within itself for the issuance of
 155-5   obligations and the performance of the other acts and procedures
 155-6   authorized by this chapter or under any agreement, without
 155-7   reference to any other laws or any restrictions or limitations
 155-8   contained in those laws.
 155-9         (b)  To the extent of any conflict between this chapter and
155-10   another law or a municipal charter, this chapter controls.
155-11         (c)  An issuer may use a provision of another law that does
155-12   not conflict with this chapter to the extent convenient or
155-13   necessary to carry out any power or authority, express or implied,
155-14   granted by this chapter.  (V.A.C.S. Art. 717q, Sec. 10 (part).)
155-15           (Sections 1371.004-1371.050 reserved for expansion)
155-16           SUBCHAPTER B.  ISSUANCE AND APPROVAL OF OBLIGATION
155-17         Sec. 1371.051.  AUTHORITY TO ISSUE OBLIGATION.  The governing
155-18   body of an issuer may issue, sell, and deliver an obligation to
155-19   finance a project cost or to refund an obligation issued in
155-20   connection with an eligible project as may be authorized and
155-21   approved by the governing body.  (V.A.C.S. Art. 717q, Sec. 2(a)
155-22   (part), as amended Acts 73rd Leg., R.S., Chs. 632 and 929.)
155-23         Sec. 1371.052.  TRANSPORTATION AUTHORITY OBLIGATION;
155-24   ELECTION.  (a)  A transportation authority created, organized, and
155-25   operating under Chapter 452, Transportation Code, may not issue an
155-26   obligation, other than a refunding obligation,  that is payable in
155-27   whole or in part from its sales and use tax revenue and has a
 156-1   maturity longer than five years unless an election required by
 156-2   Section 452.352(b), Transportation Code, has been held and the
 156-3   proposition has been approved.
 156-4         (b)  An obligation that is exempt from the election
 156-5   requirement of Section 452.352(b), Transportation Code, by the
 156-6   terms of Chapter 452, Transportation Code, is also exempt from the
 156-7   election requirement of this section.  (V.A.C.S. Art. 717q,
 156-8   Sec. 2(b).)
 156-9         Sec. 1371.053.  OBLIGATION AUTHORIZATION.  (a)  The issuance
156-10   of an obligation must be authorized by an obligation authorization.
156-11         (b)  The obligation authorization must establish:
156-12               (1)  the maximum amount of the obligation to be issued
156-13   or, if applicable, the maximum principal amount that may be
156-14   outstanding at any time;
156-15               (2)  the maximum term for which obligations issued
156-16   under the authorization may be outstanding;
156-17               (3)  the maximum interest rate the obligation will
156-18   bear;
156-19               (4)  subject to Subsection (c)(2), the manner of sale
156-20   of the obligation, which may be by public or private sale, the
156-21   price of the obligation, the form of the obligation, and the terms
156-22   and covenants of the obligation; and
156-23               (5)  each source securing payment of the obligation.
156-24         (c)  The obligation authorization may:
156-25               (1)  provide for the designation of a paying agent and
156-26   registrar for the obligation; and
156-27               (2)  authorize one or more designated officers or
 157-1   employees of the issuer to act on behalf of the issuer from time to
 157-2   time in selling and delivering the obligation and setting the
 157-3   dates, price, interest rates, interest payment periods, and other
 157-4   procedures relating to the obligation, as specified in the
 157-5   obligation authorization.
 157-6         (d)  An obligation may:
 157-7               (1)  be issued in a specified form or denomination;
 157-8               (2)  be payable:
 157-9                     (A)  at one or more times;
157-10                     (B)  in installments or a specified amount or
157-11   amounts;
157-12                     (C)  at a specified place or places;
157-13                     (D)  in a specified form;
157-14                     (E)  under specified terms and details; and
157-15                     (F)  in a specified manner; and
157-16               (3)  be issued as redeemable before maturity at one or
157-17   more specified times.  (V.A.C.S. Art. 717q, Sec. 2(a) (part), as
157-18   amended Acts 73rd Leg., R.S., Chs. 632 and 929, Sec. 3 (part).)
157-19         Sec. 1371.054.  RATE OF INTEREST.  (a)  An obligation may
157-20   bear no interest or bear interest at any rate or rates not to
157-21   exceed the maximum net effective interest rate allowed by law,
157-22   whether fixed, variable, floating, adjustable, or otherwise, as
157-23   determined in accordance with the obligation authorization.
157-24         (b)  The obligation authorization may provide a formula,
157-25   index,  contract, or other arrangement for the periodic
157-26   determination of interest rates.  (V.A.C.S. Art. 717q, Sec. 3
157-27   (part).)
 158-1         Sec. 1371.055.  EXECUTION OF OBLIGATION.  (a)  An obligation
 158-2   may be executed, with or without a seal, with a manual or facsimile
 158-3   signature, as specified in the obligation authorization.
 158-4         (b)  The signature on an obligation of a person who is no
 158-5   longer an officer when the obligation is delivered to the purchaser
 158-6   is valid and sufficient for all purposes.
 158-7         (c)  A person's successor in office may complete the
 158-8   execution, authentication, or delivery of the obligation.
 158-9   (V.A.C.S. Art. 717q, Sec. 3 (part).)
158-10         Sec. 1371.056.  AUTHORITY TO ENTER INTO AND EXECUTE CREDIT
158-11   AGREEMENTS.  (a)  A governing body may execute and deliver a credit
158-12   agreement to finance a project cost or to refund an obligation
158-13   issued in connection with an eligible project as may be authorized
158-14   and approved by the governing body.
158-15         (b)  To enhance the security for or provide for the payment,
158-16   redemption, or remarketing of an obligation and interest on the
158-17   obligation in order to reduce the interest payable on the
158-18   obligation or in conjunction with the interim financing of an
158-19   eligible project of an issuer, a governing body may enter into a
158-20   credit agreement:
158-21               (1)  at or after the issuance of the obligation; or
158-22               (2)  in conjunction with the payment, sale, resale, or
158-23   exchange of the obligation.
158-24         (c)  The governing body may execute a credit agreement in
158-25   relation to the issuance, payment, sale, resale, or exchange of an
158-26   obligation at any time, without regard to whether a credit
158-27   agreement was contemplated, authorized, or executed in relation to
 159-1   the initial issuance, sale, or delivery of the obligation.
 159-2         (d)  A credit agreement must contain the terms and be for the
 159-3   period the governing body approves.
 159-4         (e)  The cost to the issuer of a credit agreement may be paid
 159-5   from any source, including:
 159-6               (1)  the proceeds from the sale of the obligation to
 159-7   which the credit agreement relates;
 159-8               (2)  revenue of the issuer that is available to pay the
 159-9   obligation;
159-10               (3)  any interest on the obligation or that may
159-11   otherwise be legally used; or
159-12               (4)  ad valorem taxes to the extent permitted by this
159-13   chapter.
159-14         (f)  A credit agreement is an agreement for professional
159-15   services.  (V.A.C.S. Art. 717q, Sec. 2(a) (part), as amended Acts
159-16   73rd Leg., R.S., Chs. 632 and 929, Sec. 4.)
159-17         Sec. 1371.057.  REVIEW AND APPROVAL OF OBLIGATION, CREDIT
159-18   AGREEMENT, AND CONTRACT BY ATTORNEY GENERAL.  (a)  Before an
159-19   obligation may be issued or a credit agreement executed, a record
159-20   of the proceedings of the issuer authorizing the issuance,
159-21   execution, and delivery of the obligation, the credit agreement,
159-22   and any contract providing revenue or security to pay the
159-23   obligation or the credit agreement must be submitted to the
159-24   attorney general for review.
159-25         (b)  If the attorney general finds that the credit agreement,
159-26   contract, and other authorizing proceedings conform to the
159-27   requirements of the Texas Constitution and this chapter, the
 160-1   attorney general shall approve them.  After approval, the
 160-2   obligation and credit agreement may be executed and delivered,
 160-3   exchanged, or refinanced from time to time in accordance with those
 160-4   authorizing proceedings.
 160-5         (c)  On approval by the attorney general and initial delivery
 160-6   of the obligation, a credit agreement, a contract providing revenue
 160-7   or security, an initial obligation, and any obligation subsequently
 160-8   issued under the authorizing proceedings are incontestable in a
 160-9   court or other forum and are valid and binding obligations
160-10   enforceable according to their terms.  (V.A.C.S. Art. 717q, Sec. 6,
160-11   as amended Acts 73rd Leg., R.S., Chs. 632 and 929.)
160-12         Sec. 1371.058.  REFINANCING, RENEWAL, OR REFUNDING OF
160-13   OBLIGATION OR CREDIT AGREEMENT.  An obligation, including accrued
160-14   interest, or a credit agreement may from time to time be
160-15   refinanced, renewed, or refunded by the issuance of another
160-16   obligation or credit agreement.  (V.A.C.S. Art. 717q, Sec. 5, as
160-17   amended Acts 73rd Leg., R.S., Chs. 632 and 929.)
160-18           (Sections 1371.059-1371.100 reserved for expansion)
160-19             SUBCHAPTER C.  FINANCIAL ASPECTS OF OBLIGATION
160-20         Sec. 1371.101.  OBLIGATION AS NEGOTIABLE INSTRUMENT AND
160-21   INVESTMENT SECURITY.  An obligation is:
160-22               (1)  a negotiable instrument; and
160-23               (2)  an investment security to which Chapter 8,
160-24   Business & Commerce Code, applies.  (V.A.C.S. Art. 717q, Sec. 7
160-25   (part).)
160-26         Sec. 1371.102.  USE OF CERTAIN PROCEEDS.  (a)  The proceeds
160-27   from the sale of an obligation may be deposited or invested in any
 161-1   manner and in any obligation specified in the obligation
 161-2   authorization.
 161-3         (b)  A project cost incurred before the issuance of an
 161-4   obligation issued to finance the related eligible project may be
 161-5   reimbursed from the proceeds from the sale of the obligation.
 161-6   (V.A.C.S. Art. 717q, Secs. 1(4) (part), 3 (part).)
 161-7         Sec. 1371.103.  SECURITY FOR OBLIGATION.  (a)  An obligation
 161-8   must be secured solely by:
 161-9               (1)  the proceeds from the sale of other obligations;
161-10               (2)  the proceeds from the sale of revenue bonds
161-11   payable from the revenue to be received from a public works or a
161-12   specified user of a public works;
161-13               (3)  any revenue that the issuer is authorized by the
161-14   constitution, a statute, or the charter of a home-rule municipality
161-15   to pledge to the payment of an obligation;
161-16               (4)  a credit agreement; or
161-17               (5)  any combination of those sources.
161-18         (b)  A governing body may secure an obligation and pay the
161-19   cost of a credit agreement executed and delivered in connection
161-20   with the financing of a project cost with ad valorem taxes or with
161-21   other sources permitted by this chapter.   (V.A.C.S. Art. 717q,
161-22   Secs. 2(a) (part), as amended Acts 73rd Leg., R.S., Chs. 632 and
161-23   929, (c).)
161-24         Sec. 1371.104.  SOURCE OF REPAYMENT OF OBLIGATION.  An
161-25   obligation must be repaid from:
161-26               (1)  a source of security for the payment of the
161-27   obligation;
 162-1               (2)  money received from a credit agreement; or
 162-2               (3)  any other revenue legally available for the
 162-3   payment of the obligation.  (V.A.C.S. Art. 717q, Sec. 2(a) (part),
 162-4   as amended Acts 73rd Leg., R.S., Chs.  632 and 929.)
 162-5         Sec. 1371.105.  PLEDGE OR LIEN ON RESOURCES, ASSETS, OR FUND
 162-6   OF ISSUER.  (a)  A pledge or lien provided for in the resolution,
 162-7   order, ordinance, or other proceedings authorizing a public
 162-8   security, a credit agreement, or another agreement on a resource of
 162-9   the issuer, including revenue or income, on an asset of the issuer,
162-10   or on a fund maintained by the issuer to secure payment of the
162-11   public security or to secure a payment required by a credit
162-12   agreement or other agreement:
162-13               (1)  is valid and binding without further action by the
162-14   issuer according to its terms and without being filed or recorded,
162-15   except in the records of the issuer;
162-16               (2)  is effective from the time of payment for and
162-17   delivery of the public security or execution of the credit
162-18   agreement or other agreement until:
162-19                     (A)  the public security or other payment has
162-20   been paid;
162-21                     (B)  payment of the public security has been
162-22   provided for; or
162-23                     (C)  each term of the credit agreement or other
162-24   agreement has been satisfied; and
162-25               (3)  is effective as to an item on hand or later
162-26   received, and the item is subject to the lien or pledge without
162-27   physical delivery of the item or other action.
 163-1         (b)  This section does not exempt an issuer from a duty to:
 163-2               (1)  record a lien on real property; or
 163-3               (2)  submit a public security issue for approval by the
 163-4   attorney general and registration by the comptroller.  (V.A.C.S.
 163-5   Art. 717q, Sec. 11 (part).)
 163-6         Sec. 1371.106.  PLEDGE OF OR LIEN ON SALES OR USE TAX
 163-7   REVENUE.  This chapter does not affect a restriction imposed by
 163-8   Chapter 321, Tax Code, on a pledge of or lien on sales and use tax
 163-9   revenue.  (V.A.C.S. Art. 717q, Sec. 11 (part).)
163-10                  CHAPTER 1372.  PRIVATE ACTIVITY BONDS
163-11                    SUBCHAPTER A.  GENERAL PROVISIONS
163-12   Sec. 1372.001.  DEFINITIONS
163-13   Sec. 1372.002.  "PROJECT"
163-14   Sec. 1372.003.  "CLOSING" IN CONNECTION WITH MORTGAGE CREDIT
163-15                     CERTIFICATES
163-16   Sec. 1372.004.  RULES
163-17   Sec. 1372.005.  DELIVERY OF REQUIRED SUBMISSIONS TO BOARD;
163-18                     ISSUANCE OF RECEIPTS
163-19   Sec. 1372.006.  FEES
163-20           (Sections 1372.007-1372.020 reserved for expansion)
163-21       SUBCHAPTER B.  ALLOCATION AND RESERVATION OF STATE CEILING
163-22   Sec. 1372.021.  ANNUAL ALLOCATION OF STATE CEILING
163-23   Sec. 1372.022.  AVAILABILITY OF STATE CEILING TO ISSUERS
163-24   Sec. 1372.023.  DEDICATION OF PORTION OF STATE CEILING TO
163-25                     TEXAS DEPARTMENT OF HOUSING AND COMMUNITY
163-26                     AFFAIRS
163-27   Sec. 1372.024.  INCREASE IN AMOUNT OF STATE CEILING AVAILABLE
 164-1                     TO ISSUERS OF STATE-VOTED ISSUES
 164-2   Sec. 1372.025.  REALLOCATION OF STATE CEILING ON FAILURE OF
 164-3                     BONDS TO QUALIFY AS TAX-EXEMPT
 164-4                     OBLIGATIONS
 164-5   Sec. 1372.026.  LIMITATION ON AMOUNT OF STATE CEILING
 164-6                     AVAILABLE TO HOUSING FINANCE
 164-7                     CORPORATIONS
 164-8   Sec. 1372.027.  PUBLICATION OF AVAILABLE STATE CEILING
 164-9   Sec. 1372.028.  APPLICATION FOR RESERVATION; FORM AND
164-10                     CONTENT
164-11   Sec. 1372.029.  APPLICATIONS FOR MULTIPLE PROJECTS AT SAME SITE
164-12                     PROHIBITED
164-13   Sec. 1372.030.  GRANTING OF CERTAIN RESERVATIONS PROHIBITED;
164-14                     EXCEPTIONS
164-15   Sec. 1372.031.  PRIORITIES FOR RESERVATIONS AMONG CERTAIN
164-16                     ISSUERS
164-17   Sec. 1372.032.  PRIORITIES FOR RESERVATIONS AMONG HOUSING
164-18                     FINANCE CORPORATIONS
164-19   Sec. 1372.033.  PRIORITIES FOR RESERVATIONS AMONG CERTAIN
164-20                     ISSUERS OF QUALIFIED STUDENT LOAN BONDS
164-21   Sec. 1372.034.  ORDER OF ACCEPTANCE OF CERTAIN APPLICATIONS
164-22                     FOR RESERVATION
164-23   Sec. 1372.035.  GRANTING OF RESERVATIONS; ORDER
164-24   Sec. 1372.036.  RESERVATIONS FROM PORTION OF STATE CEILING
164-25                     SUBSEQUENTLY BECOMING AVAILABLE
164-26   Sec. 1372.037.  LIMITATIONS ON GRANTING OF RESERVATIONS FOR
164-27                     INDIVIDUAL PROJECTS
 165-1   Sec. 1372.038.  RESERVATION DATE
 165-2   Sec. 1372.039.  CERTIFICATION REQUIRED OF ISSUER; CANCELLATION
 165-3                     ON FAILURE
 165-4   Sec. 1372.040.  RESERVATION BY CERTAIN ISSUERS OF QUALIFIED
 165-5                     MORTGAGE BONDS OF MONEY FOR MORTGAGES FOR
 165-6                     CERTAIN PERSONS
 165-7   Sec. 1372.041.  REFUSAL TO ACCEPT RESERVATION BY ISSUER
 165-8   Sec. 1372.042.  DEADLINE FOR CLOSING ON BONDS BY ISSUER
 165-9   Sec. 1372.043.  CANCELLATION OF RESERVATION ON ISSUER'S
165-10                     FAILURE TO TIMELY CLOSE ON BONDS
165-11   Sec. 1372.044.  ASSIGNMENT OF RESERVATION
165-12           (Sections 1372.045-1372.060 reserved for expansion)
165-13              SUBCHAPTER C.  CARRYFORWARD OF STATE CEILING
165-14   Sec. 1372.061.  DESIGNATION BY BOARD OF CERTAIN AMOUNTS OF
165-15                     STATE CEILING AS CARRYFORWARD
165-16   Sec. 1372.062.  PRIORITY CLASSIFICATIONS OF CARRYFORWARD
165-17                     DESIGNATIONS
165-18   Sec. 1372.063.  PRIORITY 1 CARRYFORWARD CLASSIFICATION
165-19   Sec. 1372.064.  PRIORITY 2 CARRYFORWARD CLASSIFICATION
165-20   Sec. 1372.065.  PRIORITY 3 CARRYFORWARD CLASSIFICATION
165-21   Sec. 1372.066.  PRIORITY 4 CARRYFORWARD CLASSIFICATION
165-22   Sec. 1372.067.  PRIORITY 5 CARRYFORWARD CLASSIFICATION
165-23   Sec. 1372.068.  PRIORITY 6 CARRYFORWARD CLASSIFICATION
165-24   Sec. 1372.069.  APPLICATION FOR CARRYFORWARD DESIGNATION;
165-25                     LIMITATIONS
165-26   Sec. 1372.070.  FORM AND CONTENTS OF APPLICATION FOR
165-27                     CARRYFORWARD APPLICATION
 166-1   Sec. 1372.071.  ACTION ON APPLICATION FOR CARRYFORWARD
 166-2                     DESIGNATION
 166-3   Sec. 1372.072.  AMENDMENT OR WITHDRAWAL OF APPLICATION
 166-4                     FOR CARRYFORWARD DESIGNATION
 166-5                  CHAPTER 1372.  PRIVATE ACTIVITY BONDS
 166-6                    SUBCHAPTER A.  GENERAL PROVISIONS
 166-7         Sec. 1372.001.  DEFINITIONS.  In this chapter:
 166-8               (1)  "Board" means the Bond Review Board.
 166-9               (2)  "Bonds" means all obligations, including bonds,
166-10   certificates, or notes, that are:
166-11                     (A)  authorized to be issued by:
166-12                           (i)  the constitution or a statute of this
166-13   state; or
166-14                           (ii)  the charter of a home-rule
166-15   municipality; and
166-16                     (B)  subject to the limitations of Section 146,
166-17   Internal Revenue Code (26 U.S.C. Section 146).
166-18               (3)  "Closing" means the issuance and delivery of a
166-19   bond by an issuer in exchange for the required payment for the
166-20   bond.  The term does not include a delivery of a bond if
166-21   expenditure of the proceeds of the bond is conditioned on obtaining
166-22   credit enhancement in support of the bond.
166-23               (4)  "Enterprise zone facility bond" means an
166-24   enterprise zone facility bond under Section 1394, Internal Revenue
166-25   Code (26 U.S.C. Section 1394).
166-26               (5)  "Housing finance corporation" has the meaning
166-27   assigned by Section 394.003,  Local Government Code.
 167-1               (6)  "Internal Revenue Code" means the Internal Revenue
 167-2   Code of 1986 and its subsequent amendments.
 167-3               (7)  "Issuer" means:
 167-4                     (A)  a department, board, authority, agency,
 167-5   subdivision, political subdivision, body politic, or
 167-6   instrumentality of this state; or
 167-7                     (B)  a nonprofit corporation acting for or on
 167-8   behalf of an entity described by Paragraph (A).
 167-9               (8)  "Local government" has the meaning assigned by
167-10   Section 394.003, Local Government Code.
167-11               (9)  "Mortgage credit certificate" means a certificate
167-12   of the type described by Section 25, Internal Revenue Code (26
167-13   U.S.C. Section 25).
167-14               (10)  "Private activity bond" has the meaning assigned
167-15   by Section 141(a), Internal Revenue Code (26 U.S.C. Section
167-16   141(a)).
167-17               (11)  "Qualified mortgage bond" has the meaning
167-18   assigned by Section 143(a), Internal Revenue Code (26 U.S.C.
167-19   Section 143(a)).  The term includes a mortgage credit certificate.
167-20               (12)  "Qualified residential rental project bond" means
167-21   a bond issued for a qualified residential rental project as defined
167-22   by Section 142(d), Internal Revenue Code (26 U.S.C. Section
167-23   142(d)).
167-24               (13)  "Qualified small issue bond" has the meaning
167-25   assigned by Section 144(a), Internal Revenue Code (26 U.S.C.
167-26   Section 144(a)).
167-27               (14)  "Qualified student loan bond" has the meaning
 168-1   assigned by Section 144(b), Internal Revenue Code (26 U.S.C.
 168-2   Section 144(b)).
 168-3               (15)  "Reservation" means a reservation of a portion of
 168-4   the state ceiling for a specific bond issue.
 168-5               (16)  "State-voted issue" means an issue of bonds
 168-6   approved by the voters of this state in a statewide election.
 168-7               (17)  "State ceiling" means the maximum amount of
 168-8   tax-exempt private activity bonds that may be issued by all issuers
 168-9   in this state during a calendar year, as computed under Section
168-10   146(d), Internal Revenue Code  (26 U.S.C. Section 146(d)).
168-11   (V.A.C.S. Art. 5190.9a, Secs. 1(2), (3), (4) (part), (5), (6), (7),
168-12   (8) (part), (10), (11), (14), (15), (16), (18), (19), (20), (21),
168-13   (22).)
168-14         Sec. 1372.002.  "PROJECT."  (a)  For purposes of this
168-15   chapter, a project is:
168-16               (1)  an eligible facility that is proposed to be
168-17   financed, in whole or in part, by an issue of bonds; or
168-18               (2)  in connection with an issue of qualified mortgage
168-19   bonds or qualified student loan bonds, the providing of financial
168-20   assistance to qualified mortgagors or students located in all or
168-21   any part of the jurisdiction of the issuer.
168-22         (b)  For purposes of Subsection (a)(2), the jurisdiction of
168-23   an issuer is determined on the date the issuer's application for
168-24   reservation is delivered to the board.  (V.A.C.S. Art. 5190.9a,
168-25   Sec. 1(12) (part).)
168-26         Sec. 1372.003.  "CLOSING" IN CONNECTION WITH MORTGAGE CREDIT
168-27   CERTIFICATES.  The closing of mortgage credit certificates occurs
 169-1   on the date on which an issuer elects not to issue qualified
 169-2   mortgage bonds and to establish a mortgage credit certificate
 169-3   program under Section 25, Internal Revenue Code (26 U.S.C. Section
 169-4   25).  (V.A.C.S. Art. 5190.9a, Sec. 1(4) (part).)
 169-5         Sec. 1372.004.  RULES.  The board may adopt rules necessary
 169-6   to accomplish the purposes of this chapter.  (V.A.C.S.
 169-7   Art. 5190.9a, Sec. 11.)
 169-8         Sec. 1372.005.  DELIVERY OF REQUIRED SUBMISSIONS TO BOARD;
 169-9   ISSUANCE OF RECEIPTS.  (a)  A submission required by this chapter
169-10   must be delivered to the board at its Austin office during normal
169-11   business hours.
169-12         (b)  The board shall:
169-13               (1)  note on the face of the document delivered the
169-14   date and time of delivery; and
169-15               (2)  provide the submitting issuer with a receipt that:
169-16                     (A)  describes the document delivered; and
169-17                     (B)  states the date and time of delivery.
169-18   (V.A.C.S.  Art. 5190.9a, Sec. 10.)
169-19         Sec. 1372.006.  FEES.  (a)  An application for a reservation
169-20   under Subchapter B or a carryforward designation under Subchapter C
169-21   must be accompanied by a nonrefundable fee in the amount of $500.
169-22         (b)  An issuer shall submit to the board a closing fee in an
169-23   amount that is equal to the greater of:
169-24               (1)  $1,000; or
169-25               (2)  0.025 percent of the principal amount of the bonds
169-26   certified as provided by Section 1372.039(a)(1).
169-27         (c)  An issuer exchanging a portion of the state ceiling for
 170-1   mortgage credit certificates shall submit to the board a closing
 170-2   fee in an amount that is equal to the greater of:
 170-3               (1)  $1,000; or
 170-4               (2)  0.0125 percent of the amount of the state ceiling
 170-5   exchanged.
 170-6         (d)  Of each fee required by Subsection (b) or (c):
 170-7               (1)  one-third must be submitted not later than the
 170-8   35th day after the reservation date for the issue; and
 170-9               (2)  the remainder must be submitted at the time of
170-10   closing.  (V.A.C.S. Art. 5190.9a, Secs.  6(a) (part), 12 (part).)
170-11           (Sections 1372.007-1372.020 reserved for expansion)
170-12       SUBCHAPTER B.  ALLOCATION AND RESERVATION OF STATE CEILING
170-13         Sec. 1372.021.  ANNUAL ALLOCATION OF STATE CEILING.  The
170-14   state ceiling for each calendar year is allocated to issuers of
170-15   private activity bonds.  (V.A.C.S. Art. 5190.9a, Sec. 2(a) (part).)
170-16         Sec. 1372.022.  AVAILABILITY OF STATE CEILING TO ISSUERS.
170-17   (a)  Before September 1 of each year:
170-18               (1)  31.5 percent of the state ceiling is available
170-19   exclusively for reservations by issuers of qualified mortgage
170-20   bonds;
170-21               (2)  13 percent of the state ceiling is available
170-22   exclusively for reservations by issuers of state-voted issues;
170-23               (3)  7.5 percent of the state ceiling is available
170-24   exclusively for reservations by issuers of qualified small issue
170-25   bonds and enterprise zone facility bonds;
170-26               (4)  7.5 percent of the state ceiling is available
170-27   exclusively for reservations by issuers of qualified residential
 171-1   rental project bonds;
 171-2               (5)  11 percent of the state ceiling is available
 171-3   exclusively for reservations by issuers of qualified student loan
 171-4   bonds authorized by Section 53.47, Education Code; and
 171-5               (6)  29.5 percent of the state ceiling is available
 171-6   exclusively for reservations by any other issuer of bonds that
 171-7   require an allocation.
 171-8         (b)  On and after September 1, that portion of the state
 171-9   ceiling available for reservations becomes available to any issuer
171-10   for any bonds that require an allocation, subject to the provisions
171-11   of this subchapter.  (V.A.C.S.  Art. 5190.9a, Secs. 2(b), (e).)
171-12         Sec. 1372.023.  DEDICATION OF PORTION OF STATE CEILING TO
171-13   TEXAS DEPARTMENT OF HOUSING AND COMMUNITY AFFAIRS.  Until August
171-14   25, of that portion of the state ceiling that is available
171-15   exclusively for reservations by issuers of qualified mortgage
171-16   bonds, one-third is available exclusively to the Texas Department
171-17   of Housing and Community Affairs for the purpose of issuing
171-18   qualified mortgage bonds.  (V.A.C.S. Art. 5190.9a, Sec. 2(d).)
171-19         Sec. 1372.024.  INCREASE IN AMOUNT OF STATE CEILING AVAILABLE
171-20   TO ISSUERS OF STATE-VOTED ISSUES.  (a)  If, before January 2,
171-21   applications received for reservations for state-voted issues total
171-22   more than 13 percent of the available state ceiling for that
171-23   program year, the percentage of state-voted ceiling requested that
171-24   is more than 13 percent of the state ceiling:
171-25               (1)  is removed from the state ceiling available to
171-26   other issuers on January 2; and
171-27               (2)  is available for those applications for
 172-1   reservations for state-voted issues.
 172-2         (b)  The amount removed under Subsection (a) may not exceed
 172-3   4.5 percent of the state ceiling.
 172-4         (c)  The remaining portion of the state ceiling is available
 172-5   in accordance with Section 1372.022(a).  (V.A.C.S. Art. 5190.9a,
 172-6   Sec. 2(c).)
 172-7         Sec. 1372.025.  REALLOCATION OF STATE CEILING ON FAILURE OF
 172-8   BONDS TO QUALIFY AS TAX-EXEMPT OBLIGATIONS.  (a)  If a type of bond
 172-9   listed in Section 1372.022(a) does not qualify on January 2 of any
172-10   year for treatment as a tax-exempt obligation under the Internal
172-11   Revenue Code:
172-12               (1)  Section 1372.022(a) has no effect for that year
172-13   for that type of bond; and
172-14               (2)  by March 1, the portion of the state ceiling that
172-15   but for Subdivision (1) would have been available exclusively for
172-16   reservations by issuers of that type of bond shall be reallocated
172-17   proportionately for reservation by each other category of issuer
172-18   listed in that section.
172-19         (b)  Subsection (a) does not apply to qualified mortgage
172-20   bonds made available exclusively to the Texas Department of Housing
172-21   and Community Affairs under Section 1372.023.  (V.A.C.S.
172-22   Art. 5190.9a, Secs. 2(f), (g).)
172-23         Sec. 1372.026.  LIMITATION ON AMOUNT OF STATE CEILING
172-24   AVAILABLE TO HOUSING FINANCE CORPORATIONS.  (a)  The maximum amount
172-25   of the state ceiling that may be reserved before September 1 by a
172-26   housing finance corporation for the issuance of qualified mortgage
172-27   bonds may not exceed the amount computed by multiplying the local
 173-1   population of the corporation by:
 173-2               (1)  $50, if the local population is 300,000 or more;
 173-3               (2)  $75, if the local population of the housing
 173-4   finance corporation is 200,000 or more but less than 300,000;
 173-5               (3)  $100, if the local population of the housing
 173-6   finance corporation is 100,000 or more but less than 200,000; or
 173-7               (4)  $150, if the local population of the housing
 173-8   finance corporation is less than 100,000.
 173-9         (b)  A housing finance corporation may not receive an
173-10   allocation for the issuance of qualified mortgage bonds in an
173-11   amount that exceeds $25 million.
173-12         (c)  For purposes of this section, the local population of a
173-13   housing finance corporation is the population of the local
173-14   government or local governments on whose behalf a housing finance
173-15   corporation is created.  If two local governments that have a
173-16   population of at least 20,000 each and that have overlapping
173-17   territory have created housing finance corporations that have the
173-18   power to issue bonds to provide financing for home mortgages, the
173-19   population of the housing finance corporation created on behalf of
173-20   the larger local government is computed by subtracting from the
173-21   population of the larger local government the population of the
173-22   part of the smaller local government that is located in the larger
173-23   local government.   The reduction of population provided by this
173-24   subsection is not required if the smaller local government assigns
173-25   its authority to issue bonds, based on its population, to the
173-26   larger local government.  (V.A.C.S. Art. 5190.9a, Secs. 1(8)
173-27   (part), 3(b).)
 174-1         Sec. 1372.027.  PUBLICATION OF AVAILABLE STATE CEILING.  The
 174-2   board shall publish biweekly in the Texas Register:
 174-3               (1)  a statement of the amount of the available state
 174-4   ceiling;
 174-5               (2)  a list of the issues that have received a
 174-6   reservation since the preceding publication, including the amount
 174-7   of each reservation; and
 174-8               (3)  a list of the issues that had previously received
 174-9   a reservation that have closed since the preceding publication.
174-10   (V.A.C.S. Art. 5190.9a, Sec. 8.)
174-11         Sec. 1372.028.  APPLICATION FOR RESERVATION; FORM AND
174-12   CONTENT.  (a)  In this section, "qualified bond" has the meaning
174-13   assigned by Section 141(e), Internal Revenue Code (26 U.S.C.
174-14   Section 141(e)).
174-15         (b)  An issuer may apply for a reservation for a program year
174-16   not earlier than October 10 of the preceding year.  An issuer may
174-17   not submit an application for a program year after December 1 of
174-18   that year.
174-19         (c)  The application must:
174-20               (1)  be on a form prescribed by the board;
174-21               (2)  be signed by a member or officer of the issuer;
174-22   and
174-23               (3)  state:
174-24                     (A)  the maximum amount of the bonds in the issue
174-25   that require an allocation under Section 146, Internal Revenue Code
174-26   (26 U.S.C. Section 146);
174-27                     (B)  the project or, with respect to an eligible
 175-1   facility, a functional description of the project to be financed by
 175-2   the proceeds, including the identification of the user of the
 175-3   proceeds or project;
 175-4                     (C)  whether the bonds are qualified bonds;
 175-5                     (D)  if the bonds are qualified bonds:
 175-6                           (i)  the subparagraph of Section 141(e)(1),
 175-7   Internal Revenue Code (26 U.S.C. Section 141(e)(1)), that applies;
 175-8   and
 175-9                           (ii)  if Section 141(e)(1)(A) of that code
175-10   (26 U.S.C. Section 141(e)(1)(A)) applies, the paragraph of Section
175-11   142(a) of that code (26 U.S.C. Section 142(a)) that applies;
175-12                     (E)  if the bonds are not qualified bonds:
175-13                           (i)  that Section 141(b)(5), Internal
175-14   Revenue Code (26 U.S.C. Section 141(b)(5)), applies; or
175-15                           (ii)  for a transition rule project, the
175-16   paragraph of the Tax Reform Act of 1986 that applies;
175-17                     (F)  that bonds are not being issued for the same
175-18   stated project for which the issuer has received sufficient
175-19   carryforward during a previous year or for which there exists
175-20   unexpended proceeds from one or more prior issues of bonds issued
175-21   by the same issuer or based on the issuer's population; and
175-22                     (G)  other information that the board may
175-23   require.
175-24         (d)  An issuer is not required to provide the statement
175-25   required by Subsection (c)(3)(F) if the issuer:
175-26               (1)  is an issuer of a state-voted issue;
175-27               (2)  is the Texas Department of Housing and Community
 176-1   Affairs; or
 176-2               (3)  provides evidence that one or more binding
 176-3   contracts have been entered into to spend the unexpended proceeds
 176-4   within 12 months after the date the board receives the application.
 176-5   (V.A.C.S. Art. 5190.9a, Secs. 1(12) (part), (13), 3(d) (part),
 176-6   4(a).)
 176-7         Sec. 1372.029.  APPLICATIONS FOR MULTIPLE PROJECTS AT SAME
 176-8   SITE PROHIBITED.  The board may not accept applications for
 176-9   reservations for more than one project located at, or related to, a
176-10   business operation at a particular site for any one program year.
176-11   (V.A.C.S. Art. 5190.9a, Sec. 4(c).)
176-12         Sec. 1372.030.  GRANTING OF CERTAIN RESERVATIONS PROHIBITED;
176-13   EXCEPTIONS.  (a)  The board may not grant a reservation to an
176-14   issuer to whom proceeds are available from other bonds issued by or
176-15   on behalf of that issuer for the project stated in the issuer's
176-16   application for the reservation.
176-17         (b)  Subsection (a) does not apply to an issuer to which
176-18   Section 1372.028(d) applies.  (V.A.C.S. Art. 5190.9a, Sec. 4(b).)
176-19         Sec. 1372.031.  PRIORITIES FOR RESERVATIONS AMONG CERTAIN
176-20   ISSUERS.  If, on or before October 20, more than one issuer in a
176-21   category described by Section 1372.022(a)(2), (3), (4), or (6)
176-22   applies for a reservation of the state ceiling for the next program
176-23   year, the board shall grant reservations in that category in the
176-24   order determined by the board by lot.  (V.A.C.S. Art. 5190.9a, Sec.
176-25   3(c) (part).)
176-26         Sec. 1372.032.  PRIORITIES FOR RESERVATIONS AMONG HOUSING
176-27   FINANCE CORPORATIONS.  (a)  If, on or before October 20, more than
 177-1   one housing finance corporation applies for a reservation of the
 177-2   state ceiling for qualified mortgage bonds for the next program
 177-3   year, the board shall give priority in granting reservations in
 177-4   that category to issuers that:
 177-5               (1)  applied before September 1 of the preceding year
 177-6   for a reservation on behalf of the same local population for that
 177-7   year; but
 177-8               (2)  were not granted a reservation during that year.
 177-9         (b)  The priority of an issuer under Subsection (a) that is
177-10   composed of more than one jurisdiction is not affected by the
177-11   issuer's loss of a sponsoring local government and that
177-12   government's population if the dollar amount of the application has
177-13   not increased.
177-14         (c)  Within the group of issuers given priority and within
177-15   the group not given priority, the board shall grant reservations in
177-16   reverse order of the date of the most recent closing of qualified
177-17   mortgage bonds applicable to the housing finance corporations, with
177-18   a corporation that has never received a reservation for mortgage
177-19   revenue bonds being the first to receive a reservation and the
177-20   corporation that had the most recent closing being the last to
177-21   receive a  reservation.  If closings occurred on the same date, the
177-22   board shall grant reservations in the order determined by the board
177-23   by lot.
177-24         (d)  For purposes of Subsection (c), the most recent closing
177-25   applicable to a newly created housing finance corporation sponsored
177-26   by one or more local governments that had previously sponsored
177-27   another housing finance corporation, whether existing or not, or to
 178-1   a housing finance corporation sponsored by a local government that
 178-2   has participated in the program of another housing finance
 178-3   corporation is the most recent closing of qualified mortgage bonds
 178-4   the proceeds of which were available to the population of the
 178-5   corporation.
 178-6         (e)  A housing finance corporation or its sponsoring local
 178-7   government may not achieve an advantage in the  determination of
 178-8   its most recent closing by creating, dissolving, or withdrawing
 178-9   from a housing finance corporation.  (V.A.C.S.  Art. 5190.9a, Sec.
178-10   3(c) (part).)
178-11         Sec. 1372.033.  PRIORITIES FOR RESERVATIONS AMONG CERTAIN
178-12   ISSUERS OF QUALIFIED STUDENT LOAN BONDS.  (a)  If, on or before
178-13   October 20, more than one issuer authorized by Section 53.47,
178-14   Education Code, to issue qualified student loan bonds applies for a
178-15   reservation of the state ceiling for qualified student loan bonds
178-16   for the next program year, the board shall grant reservations in
178-17   that category in reverse order of the date of the most recent
178-18   closing of qualified student loan bonds by each issuer.  The issuer
178-19   that had the most recent closing shall be the last to receive a
178-20   reservation.
178-21         (b)  If closings occurred on the same date, the board shall
178-22   grant reservations in the order determined by the board by lot.
178-23   (V.A.C.S. Art. 5190.9a, Sec. 3(c) (part).)
178-24         Sec. 1372.034.  ORDER OF ACCEPTANCE OF CERTAIN APPLICATIONS
178-25   FOR RESERVATION.  The board shall accept applications for a
178-26   reservation submitted after October 20 in the order in which they
178-27   are received.  (V.A.C.S. Art. 5190.9a, Sec. 3(c) (part).)
 179-1         Sec. 1372.035.  GRANTING OF RESERVATIONS; ORDER.  (a)  The
 179-2   board may not grant a reservation of a portion of the state ceiling
 179-3   for a program year before January 2 or after December 1 of that
 179-4   year.
 179-5         (b)  Except as provided by Sections 1372.031-1372.033, the
 179-6   board shall grant reservations in the order in which the
 179-7   applications for those reservations are received, regardless of the
 179-8   amounts of the related bond issues.  (V.A.C.S. Art. 5190.9a, Secs.
 179-9   2(a) (part); 3(c) (part), (d) (part).)
179-10         Sec. 1372.036.  RESERVATIONS FROM PORTION OF STATE CEILING
179-11   SUBSEQUENTLY BECOMING AVAILABLE.  (a)  If, before June 1, any
179-12   portion of the state ceiling in a category described by Section
179-13   1372.022(a) from which issuers were granted reservations becomes
179-14   available in that category:
179-15               (1)  those amounts of the state ceiling shall be
179-16   aggregated; and
179-17               (2)  the board shall grant reservations from that
179-18   category on June 1.
179-19         (b)  If, after June 1 and before August 25, any portion of
179-20   the state ceiling in a category described by Section 1372.022(a)
179-21   from which issuers were granted reservations becomes available in
179-22   that category:
179-23               (1) those amounts of the state ceiling shall be
179-24   aggregated; and
179-25               (2)  the board shall grant reservations from that
179-26   category on August 25.
179-27         (c)  After January 1, the board may grant a reservation to an
 180-1   issuer if the amount of state ceiling available in a category is
 180-2   greater than the amount of state ceiling applied for in that
 180-3   category.  (V.A.C.S. Art. 5190.9a, Sec. 3(e).)
 180-4         Sec. 1372.037.  LIMITATIONS ON GRANTING OF RESERVATIONS FOR
 180-5   INDIVIDUAL PROJECTS.  Before September 1, for any one project, the
 180-6   board may not grant a reservation for that year that is greater
 180-7   than:
 180-8               (1)  $25 million, if the issuer is an issuer of
 180-9   qualified mortgage bonds, other than the Texas Department of
180-10   Housing and Community Affairs;
180-11               (2)  $50 million, if the issuer is an issuer of a
180-12   state-voted issue, other than the Texas Higher Education
180-13   Coordinating Board, or $75 million, if the issuer is the Texas
180-14   Higher Education Coordinating Board;
180-15               (3)  the amount to which the Internal Revenue Code
180-16   limits issuers of qualified small issue bonds and enterprise zone
180-17   facility bonds, if the issuer is an issuer of those bonds;
180-18               (4)  the lesser of $15 million or 15 percent of the
180-19   amount set aside for reservation by issuers of qualified
180-20   residential rental project bonds, if the issuer is an issuer of
180-21   those bonds;
180-22               (5)  $35 million, if the issuer is an issuer authorized
180-23   by Section 53.47, Education Code, to issue qualified student loan
180-24   bonds; or
180-25               (6)  $25 million, if the issuer is any other issuer of
180-26   bonds that require an allocation.   (V.A.C.S. Art. 5190.9a, Sec.
180-27   3(a).)
 181-1         Sec. 1372.038.  RESERVATION DATE.  The reservation date for
 181-2   an issue is the date on which the board notifies an issuer whose
 181-3   application for the reservation has been accepted for filing by the
 181-4   board that a portion of the state ceiling is available to that
 181-5   issue.  (V.A.C.S. Art. 5190.9a, Sec. 6(d).)
 181-6         Sec. 1372.039.  CERTIFICATION REQUIRED OF ISSUER;
 181-7   CANCELLATION ON FAILURE.  (a)  Not later than the 35th day after an
 181-8   issuer's reservation date, the issuer shall submit to the board:
 181-9               (1)  a certificate signed by the issuer that certifies
181-10   the principal amount of the bonds to be issued; and
181-11               (2)  a list of finance team members and their addresses
181-12   and telephone numbers.  
181-13         (b)  If the principal amount certified by the issuer is less
181-14   than the amount stated in the issuer's application for the
181-15   reservation, the amount of the issuer's reservation is reduced to
181-16   the amount certified.
181-17         (c)  If an issuer does not submit the documents as required
181-18   by this section and the fee as required by Section 1372.006(d)(1):
181-19               (1)  the reservation is canceled; and
181-20               (2)  from the reservation date of the canceled
181-21   reservation until the expiration of the applicable period described
181-22   by Section 1372.042(a) or (b):
181-23                     (A)  no issuer may submit an application for a
181-24   reservation for the same project; and
181-25                     (B)  the issuer is eligible for a carryforward
181-26   designation for the project only as provided by Subchapter C.
181-27   (V.A.C.S. Art. 5190.9a, Secs. 6(a) (part), (b), (c).)
 182-1         Sec. 1372.040.  RESERVATION BY CERTAIN ISSUERS OF QUALIFIED
 182-2   MORTGAGE BONDS OF MONEY FOR MORTGAGES FOR CERTAIN PERSONS.  An
 182-3   issuer of qualified mortgage bonds, other than the Texas Department
 182-4   of Housing and Community Affairs, shall reserve for six months 50
 182-5   percent of the funds available for loans outside the federally
 182-6   designated target areas to provide mortgages to individuals and
 182-7   families with incomes below 80 percent of the applicable median
 182-8   family income, as defined by Section 143(f)(4), Internal Revenue
 182-9   Code (26 U.S.C. Section 143(f)(4)).  (V.A.C.S. Art. 5190.9a, Sec.
182-10   3(g).)
182-11         Sec. 1372.041.  REFUSAL TO ACCEPT RESERVATION BY ISSUER.
182-12   (a)  An issuer may:
182-13               (1)  refuse to accept a reservation if the amount of
182-14   state ceiling available is less than the amount for which the
182-15   issuer applied; or
182-16               (2)  refuse to accept a reservation for any amount if
182-17   the reservation is granted after September 23.
182-18         (b)  The amount of available state ceiling is subject to the
182-19   grant of a reservation to each succeeding issuer eligible to be
182-20   granted a reservation of that available state ceiling in the order
182-21   of priority under this subchapter.
182-22         (c)  An issuer's refusal to accept a reservation does not
182-23   affect the issuer's order of priority for a subsequent grant of a
182-24   reservation.  (V.A.C.S. Art. 5190.9a, Sec. 3(f).)
182-25         Sec. 1372.042.  DEADLINE FOR CLOSING ON BONDS BY ISSUER.
182-26   (a)  An issuer other than an issuer of qualified mortgage bonds
182-27   shall close on the bonds for which the reservation was granted not
 183-1   later than the 120th day after the reservation date.
 183-2         (b)  An issuer of qualified mortgage revenue bonds shall
 183-3   close on the bonds for which the reservation was granted not later
 183-4   than the 180th day after the reservation date.
 183-5         (c)  Notwithstanding Subsections (a) and (b), the issuer
 183-6   shall close on the bonds before December 24.
 183-7         (d)  Not later than the fifth business day after the date on
 183-8   which the bonds are closed, the issuer shall submit to the board:
 183-9               (1)  a written notice stating the delivery date of the
183-10   bonds and the principal amount of the bonds issued; and
183-11               (2)  a certified copy of the document authorizing the
183-12   bonds and any other document relating to the issuance of the bonds,
183-13   including a statement of the bonds':
183-14                     (A)  principal amount;
183-15                     (B)  interest rate or formula by which the
183-16   interest rate is computed;
183-17                     (C)  maturity schedule; and
183-18                     (D)  purchaser or purchasers.  (V.A.C.S.
183-19   Art. 5190.9a, Secs. 7(a), (b), (d).)
183-20         Sec. 1372.043.  CANCELLATION OF RESERVATION ON ISSUER'S
183-21   FAILURE TO TIMELY CLOSE ON BONDS.  If an issuer does not close on
183-22   the issuer's bonds as required by Section 1372.042:
183-23               (1)  the reservation for the issue is canceled; and
183-24               (2)  for the period beginning on the reservation date
183-25   and ending on the 150th day after the reservation date or on the
183-26   210th day after the reservation date if the issuer is an issuer of
183-27   qualified mortgage bonds:
 184-1                     (A)  no issuer may submit an application for a
 184-2   reservation for the same project; and
 184-3                     (B)  the issuer is eligible for a carryforward
 184-4   designation for the project only as provided by Subchapter C.
 184-5   (V.A.C.S. Art. 5190.9a, Sec. 7(c).)
 184-6         Sec. 1372.044.  ASSIGNMENT OF RESERVATION.  A reservation may
 184-7   be assigned only between a governmental unit and an issuer that is
 184-8   authorized to issue private activity bonds on behalf of that
 184-9   governmental unit.  (V.A.C.S. Art. 5190.9a, Sec. 5.)
184-10           (Sections 1372.045-1372.060 reserved for expansion)
184-11              SUBCHAPTER C.  CARRYFORWARD OF STATE CEILING
184-12         Sec. 1372.061.  DESIGNATION BY BOARD OF CERTAIN AMOUNTS OF
184-13   STATE CEILING AS CARRYFORWARD.  The board may designate as
184-14   carryforward:
184-15               (1)  the amount of the state ceiling that is not
184-16   reserved before December 15; and
184-17               (2)  any amount of the state ceiling that:
184-18                     (A)  was reserved before December 15; and
184-19                     (B)  becomes available on or after that date
184-20   because of the cancellation of a reservation.  (V.A.C.S.
184-21   Art. 5190.9a, Sec.  9(a) (part).)
184-22         Sec. 1372.062.  PRIORITY CLASSIFICATIONS OF CARRYFORWARD
184-23   DESIGNATIONS.  The board shall:
184-24               (1)  designate amounts as carryforward in accordance
184-25   with the system of priority classifications specified in Sections
184-26   1372.063-1372.068; and
184-27               (2)  in each classification, make the designations in
 185-1   order of the applications for those designations.  (V.A.C.S.
 185-2   Art. 5190.9a, Sec. 9(a) (part).)
 185-3         Sec. 1372.063.  PRIORITY 1 CARRYFORWARD CLASSIFICATION.  The
 185-4   priority 1 carryforward classification applies to an issuer of a
 185-5   state-voted issue.  (V.A.C.S. Art. 5190.9a, Sec. 9(b) (part).)
 185-6         Sec. 1372.064.  PRIORITY 2 CARRYFORWARD CLASSIFICATION.  The
 185-7   priority 2 carryforward classification applies to an issuer of
 185-8   bonds approved by the voters of a political subdivision of this
 185-9   state if:
185-10               (1)  the bonds will be private activity bonds for which
185-11   an allocation will be required for the bonds to be tax exempt under
185-12   the Internal Revenue Code; or
185-13               (2)  the excess private use of a governmental bond will
185-14   require allocation so that the bond may retain its tax exempt
185-15   status under the Internal Revenue Code.  (V.A.C.S. Art. 5190.9a,
185-16   Secs. 1(9), 9(b) (part).)
185-17         Sec. 1372.065.  PRIORITY 3 CARRYFORWARD CLASSIFICATION.  The
185-18   priority 3 carryforward classification applies to:
185-19               (1)  a state agency, other than an issuer of a
185-20   state-voted issue; and
185-21               (2)  a political subdivision whose board of directors
185-22   holds office under Section 30a, Article XVI, Texas Constitution.
185-23   (V.A.C.S. Art. 5190.9a, Sec. 9(b) (part).)
185-24         Sec. 1372.066.  PRIORITY 4 CARRYFORWARD CLASSIFICATION.
185-25   (a)  The priority 4 carryforward classification applies to any
185-26   political subdivision:
185-27               (1)  that is authorized to issue bonds; and
 186-1               (2)  to which priority carryforward classifications 1-3
 186-2   do not apply.
 186-3         (b)  A project that is the subject of an application for a
 186-4   priority 4 carryforward classification must be owned by a
 186-5   governmental unit in accordance with applicable provisions of the
 186-6   Internal Revenue Code.  (V.A.C.S. Art. 5190.9a, Sec. 9(b) (part).)
 186-7         Sec. 1372.067.  PRIORITY 5 CARRYFORWARD CLASSIFICATION.
 186-8   (a)  The priority 5 carryforward classification applies to an
 186-9   issuer that:
186-10               (1)  was created to act on behalf of this state or one
186-11   or more political subdivisions of this state; and
186-12               (2)  is applying for carryforward for a project:
186-13                     (A)  for which there has been an inducement
186-14   resolution or other comparable preliminary approval; and
186-15                     (B)  with respect to which:
186-16                           (i)  a binding contract to incur
186-17   significant expenditures for construction, reconstruction, or
186-18   rehabilitation was entered into before submission of the
186-19   application;
186-20                           (ii)  significant expenditures for
186-21   construction, reconstruction, or rehabilitation were readily
186-22   identifiable with and necessary to carry out a binding contract for
186-23   the supply of property or services or the sale of output; or
186-24                           (iii)  significant expenditures were paid
186-25   or incurred before submission of the application.
186-26         (b)  In this section, "significant expenditures" means
186-27   expenditures that are greater than the lesser of:
 187-1               (1)  $1 million; or
 187-2               (2)  10 percent of the reasonably anticipated cost of
 187-3   the project. (V.A.C.S. Art. 5190.9a, Sec. 9(b) (part).)
 187-4         Sec. 1372.068.  PRIORITY 6 CARRYFORWARD CLASSIFICATION.  The
 187-5   priority 6 carryforward classification applies to an issuer that:
 187-6               (1)  was created to act on behalf of this state or one
 187-7   or more political subdivisions of this state; and
 187-8               (2)  is applying for carryforward for a project that is
 187-9   not eligible for another priority carryforward classification.
187-10   (V.A.C.S. Art. 5190.9a, Sec. 9(b) (part).)
187-11         Sec. 1372.069.  APPLICATION FOR CARRYFORWARD DESIGNATION;
187-12   LIMITATIONS.  (a)  An issuer may apply for a carryforward
187-13   designation at any time during the year in which the designation is
187-14   sought.
187-15         (b)  An issuer that applies for a carryforward designation
187-16   may not apply later in the same year for a reservation for the same
187-17   project.
187-18         (c)  An issuer may not apply for the carryforward designation
187-19   of an amount that is greater than $50 million.
187-20         (d)  The board by rule shall prevent an issuer from applying
187-21   for a carryforward designation in an amount that is greater than
187-22   the amount needed.  (V.A.C.S. Art. 5190.9a, Secs. 9(a) (part), (f),
187-23   (g).)
187-24         Sec. 1372.070.  FORM AND CONTENTS OF APPLICATION FOR
187-25   CARRYFORWARD APPLICATION.  An application for a carryforward
187-26   designation must:
187-27               (1)  be on a form prescribed by the board;
 188-1               (2)  be signed by a member or officer of the issuer and
 188-2   by:
 188-3                     (A)  the governor, if the issuer was created to
 188-4   act on behalf of this state; or
 188-5                     (B)  the presiding officer or another authorized
 188-6   official of each political subdivision, if the issuer was created
 188-7   to act on behalf of one or more political subdivisions of this
 188-8   state;
 188-9               (3)  state the amount of carryforward sought;
188-10               (4)  describe the project;
188-11               (5)  state which priority classification is applicable
188-12   to the applicant;
188-13               (6)  include evidence satisfactory to the board that
188-14   that priority classification is correct; and
188-15               (7)  contain any other information that the board by
188-16   rule requires.  (V.A.C.S. Art. 5190.9a, Secs. 1(12) (part), 9(c).)
188-17         Sec. 1372.071.  ACTION ON APPLICATION FOR CARRYFORWARD
188-18   DESIGNATION.  On receipt of an application for a carryforward
188-19   designation, the board shall:
188-20               (1)  determine whether the application complies with
188-21   the requirements of this chapter and board rules; and
188-22               (2)  note its determination on the application.
188-23   (V.A.C.S.  Art. 5190.9a, Sec. 9(d).)
188-24         Sec. 1372.072.  AMENDMENT OR WITHDRAWAL OF APPLICATION FOR
188-25   CARRYFORWARD DESIGNATION.  (a)  An issuer may amend or withdraw an
188-26   application for a carryforward designation by submitting to the
188-27   board a notice of the amendment or withdrawal.
 189-1         (b)  If an application is amended, the application's place in
 189-2   the order of eligibility for a carryforward designation in a
 189-3   priority classification is determined using the date of the
 189-4   amendment instead of the date of the original application.
 189-5   (V.A.C.S. Art. 5190.9a, Sec. 9(e).)
 189-6               (Chapters 1373-1400 reserved for expansion)
 189-7          SUBTITLE G.  SPECIFIC AUTHORITY FOR STATE GOVERNMENT
 189-8                           TO ISSUE SECURITIES
 189-9          CHAPTER 1401.  BONDS FOR CERTAIN CRIMINAL JUSTICE OR
189-10             MENTAL HEALTH AND MENTAL RETARDATION FACILITIES
189-11                    SUBCHAPTER A.  GENERAL PROVISIONS
189-12   Sec. 1401.001.  DEFINITIONS
189-13   Sec. 1401.002.  BOND REVIEW BOARD MEMBER IMMUNITY
189-14   Sec. 1401.003.  LEGISLATIVE AUTHORITY
189-15           (Sections 1401.004-1401.020 reserved for expansion)
189-16               SUBCHAPTER B.  BOND REVIEW BOARD OVERSIGHT
189-17   Sec. 1401.021.  BOND REVIEW BOARD APPROVAL OF BOND
189-18                     ISSUANCE
189-19   Sec. 1401.022.  BOND REVIEW BOARD APPROVAL OF PROJECT
189-20           (Sections 1401.023-1401.040 reserved for expansion)
189-21          SUBCHAPTER C.  GENERAL OBLIGATION BONDS AND PROCEEDS
189-22   Sec. 1401.041.  GENERAL OBLIGATION BONDS
189-23   Sec. 1401.042.  REFUNDING BONDS
189-24   Sec. 1401.043.  REFINANCING CERTAIN OBLIGATIONS
189-25   Sec. 1401.044.  DISTRIBUTION OF PROCEEDS
189-26   Sec. 1401.045.  INTEREST AND SINKING FUND BALANCE
189-27                     REPORT
 190-1           (Sections 1401.046-1401.060 reserved for expansion)
 190-2                SUBCHAPTER D.  REVENUE BONDS AND PROCEEDS
 190-3   Sec. 1401.061.  REVENUE BONDS
 190-4   Sec. 1401.062.  REVENUE BOND PROCEEDS
 190-5   Sec. 1401.063.  INVESTMENT OF PROCEEDS
 190-6   Sec. 1401.064.  PAYMENT OF PRINCIPAL OR INTEREST
 190-7   Sec. 1401.065.  BOND REQUIREMENTS
 190-8           (Sections 1401.066-1401.080 reserved for expansion)
 190-9                  SUBCHAPTER E.  REVENUE BOND PROJECTS
190-10   Sec. 1401.081.  CONDITIONS FOR BEGINNING PROJECT
190-11   Sec. 1401.082.  REVENUE BOND REPAYMENT AND LEASE AGREEMENT
190-12   Sec. 1401.083.  RIGHTS TO FINANCED PROPERTY
190-13           (Sections 1401.084-1401.100 reserved for expansion)
190-14                   SUBCHAPTER F.  FINANCIAL PROVISIONS
190-15   Sec. 1401.101.  RESTRICTION ON AMOUNT OF OUTSTANDING BONDS
190-16   Sec. 1401.102.  EXEMPTION FROM TAXATION
190-17           (Sections 1401.103-1401.120 reserved for expansion)
190-18                 SUBCHAPTER G.  MISCELLANEOUS PROVISIONS
190-19   Sec. 1401.121.  TEXAS DEPARTMENT OF CRIMINAL JUSTICE
190-20                     MASTER PLAN
190-21   Sec. 1401.122.  HISTORICALLY UNDERUTILIZED BUSINESS
190-22                     ASSISTANCE
190-23          CHAPTER 1401.  BONDS FOR CERTAIN CRIMINAL JUSTICE OR
190-24             MENTAL HEALTH AND MENTAL RETARDATION FACILITIES
190-25                    SUBCHAPTER A.  GENERAL PROVISIONS
190-26         Sec. 1401.001.  DEFINITIONS.  In this chapter:
190-27               (1)  "Authority" means the Texas Public Finance
 191-1   Authority.
 191-2               (2)  "Board" means the board of directors of the
 191-3   authority.  (V.A.C.S. Art. 601d-1, Secs. 1(1), (2).)
 191-4         Sec. 1401.002.  BOND REVIEW BOARD MEMBER IMMUNITY.  A Bond
 191-5   Review Board member is not liable for damages that result from
 191-6   performing a function of the member under this chapter.  (V.A.C.S.
 191-7   Art. 601d-1, Sec. 2(f).)
 191-8         Sec. 1401.003.  LEGISLATIVE AUTHORITY.  The authority may not
 191-9   issue or sell a bond under this chapter for a project unless the
191-10   legislature has authorized the specific project by:
191-11               (1)  this chapter;
191-12               (2)  the General Appropriations Act; or
191-13               (3)  Chapter 1232.  (V.A.C.S. Art. 601d-1, Sec. 10.)
191-14           (Sections 1401.004-1401.020 reserved for expansion)
191-15               SUBCHAPTER B.  BOND REVIEW BOARD OVERSIGHT
191-16         Sec. 1401.021.  BOND REVIEW BOARD APPROVAL OF BOND ISSUANCE.
191-17   The authority may not issue a bond under this chapter unless the
191-18   Bond Review Board has reviewed and approved the issuance.
191-19   (V.A.C.S. Art. 601d-1, Sec. 2(d) (part).)
191-20         Sec. 1401.022.  BOND REVIEW BOARD APPROVAL OF PROJECT.  The
191-21   proceeds of a bond issued under this chapter may not be used to
191-22   finance a project unless the Bond Review Board has reviewed and
191-23   approved the project.  (V.A.C.S. Art. 601d-1, Sec. 2(d) (part).)
191-24           (Sections 1401.023-1401.040 reserved for expansion)
191-25          SUBCHAPTER C.  GENERAL OBLIGATION BONDS AND PROCEEDS
191-26         Sec. 1401.041.  GENERAL OBLIGATION BONDS.  (a)  As provided
191-27   by Section 49-h(a), Article III, Texas Constitution, the authority
 192-1   may:
 192-2               (1)  issue general obligation bonds in an amount not to
 192-3   exceed $500 million; and
 192-4               (2)  distribute the bond proceeds as provided by that
 192-5   section.
 192-6         (b)  As provided by Section 49-h(c), Article III, Texas
 192-7   Constitution, the authority may:
 192-8               (1)  issue general obligation bonds in an amount not to
 192-9   exceed $400 million; and
192-10               (2)  distribute the bond proceeds to any appropriate
192-11   agency to:
192-12                     (A)  acquire, construct, or equip a new facility;
192-13   or
192-14                     (B)  make a major repair of or renovate a
192-15   facility, corrections institution, youth corrections institution,
192-16   or mental health and mental retardation institution.
192-17         (c)  As provided by Section 49-h(d), Article III, Texas
192-18   Constitution, the authority may:
192-19               (1)  issue general obligation bonds in an amount not to
192-20   exceed $1.055 billion and distribute the bond proceeds to any
192-21   appropriate agency to:
192-22                     (A)  acquire, construct, or equip a:
192-23                           (i)  new prison or substance abuse felony
192-24   punishment facility to confine criminals; or
192-25                           (ii)  youth corrections institution;
192-26                     (B)  make a major repair of or renovate a prison
192-27   facility or youth corrections institution; or
 193-1                     (C)  acquire, make a major repair of, or renovate
 193-2   a facility for use as a state prison, a substance abuse felony
 193-3   punishment facility, or a facility in which a pilot program
 193-4   established as provided by Section 614.011, Health and Safety Code,
 193-5   is conducted;
 193-6               (2)  issue general obligation bonds in an amount not to
 193-7   exceed $45 million and distribute the bond proceeds to any
 193-8   appropriate agency to:
 193-9                     (A)  acquire, construct, or equip a new mental
193-10   health or mental retardation facility, including a community-based
193-11   mental health or mental retardation facility; or
193-12                     (B)  make a major repair of or renovate a mental
193-13   health or mental retardation facility; and
193-14               (3)  issue general obligation bonds in an amount not to
193-15   exceed $50 million and distribute the bond proceeds to any
193-16   appropriate agency to:
193-17                     (A)  acquire, construct, or equip a new youth
193-18   corrections facility; or
193-19                     (B)  make a major repair of or renovate a youth
193-20   corrections facility.
193-21         (d)  As provided by Section 49-h(e), Article III, Texas
193-22   Constitution, the authority may:
193-23               (1)  issue general obligation bonds in an amount not to
193-24   exceed $1 billion; and
193-25               (2)  distribute the bond proceeds as provided by that
193-26   section.  (V.A.C.S.  Art. 601d-1, Secs. 4(a)(1), (2) (part), (3),
193-27   (4), (d) (part), (e).)
 194-1         Sec. 1401.042.  REFUNDING BONDS.  The authority may issue a
 194-2   general obligation bond authorized under Section 1401.041 to refund
 194-3   a revenue bond issued under Subchapter D.  (V.A.C.S.  Art. 601d-1,
 194-4   Secs. 4(a)(6) (part), (d) (part).)
 194-5         Sec. 1401.043.  REFINANCING CERTAIN OBLIGATIONS.  (a)  The
 194-6   proceeds of a bond issued under Section 1401.041(a), (b), (c)(1),
 194-7   or (d) may be used to refinance an existing obligation for a
 194-8   purpose described by those subsections.
 194-9         (b)  The proceeds of a bond issued under Section
194-10   1401.041(c)(2) may be used to refinance an existing obligation for
194-11   a purpose described by that subdivision.  (V.A.C.S. Art. 601d-1,
194-12   Secs. 4(a)(6) (part), (d) (part).)
194-13         Sec. 1401.044.  DISTRIBUTION OF PROCEEDS.  The authority by
194-14   rule shall establish guidelines, criteria, and procedures for
194-15   distributions of general obligation bond proceeds.  (V.A.C.S.
194-16   Art. 601d-1, Sec.  4(c).)
194-17         Sec. 1401.045.  INTEREST AND SINKING FUND BALANCE REPORT.
194-18   (a)  The authority shall report to the Legislative Budget Board and
194-19   the Governor's Office of Budget and Planning an accurate estimate
194-20   of interest and sinking fund balances available for payment of debt
194-21   service on general obligation bonds.
194-22         (b)  The report must be made not later than January 1 of each
194-23   odd-numbered year.  (V.A.C.S. Art. 601d-1, Sec. 4(f).)
194-24           (Sections 1401.046-1401.060 reserved for expansion)
194-25                SUBCHAPTER D.  REVENUE BONDS AND PROCEEDS
194-26         Sec. 1401.061.  REVENUE BONDS.  (a)  The authority may:
194-27               (1)  issue revenue bonds; and
 195-1               (2)  distribute the bond proceeds to any appropriate
 195-2   agency to:
 195-3                     (A)  acquire, construct, or equip a new facility;
 195-4   or
 195-5                     (B)  make a major repair of or renovate a:
 195-6                           (i)  facility;
 195-7                           (ii)  corrections institution, including a
 195-8   facility authorized by Section 495.001(a) or 495.021(a);
 195-9                           (iii)  criminal justice facility for the
195-10   Texas Department of Criminal Justice;
195-11                           (iv)  youth corrections institution; or
195-12                           (v)  mental health and mental retardation
195-13   institution.
195-14         (b)  The bond proceeds may be used to refinance an existing
195-15   obligation for a purpose described by Subsection (a).  (V.A.C.S.
195-16   Art. 601d-1, Sec. 5(a).)
195-17         Sec. 1401.062.  REVENUE BOND PROCEEDS.  On issuing bonds
195-18   under Section 1401.061, the board shall:
195-19               (1)  certify to the appropriate agency and to the
195-20   comptroller that the funds are available; and
195-21               (2)  deposit the bond proceeds in the state treasury to
195-22   the account of the appropriate agency.  (V.A.C.S. Art. 601d-1, Sec.
195-23   5(b).)
195-24         Sec. 1401.063.  INVESTMENT OF PROCEEDS.  (a)  With the
195-25   board's concurrence, the comptroller shall invest the unexpended
195-26   revenue bond proceeds and the investment income of those unexpended
195-27   proceeds in investments approved by law for the investment of state
 196-1   funds.
 196-2         (b)  The investment income required for project costs, and
 196-3   not required to be rebated to the federal government or used for
 196-4   debt service, as determined by the board, shall be credited to the
 196-5   appropriate agency.  The investment income not required for project
 196-6   costs, not required to be rebated to the federal government, and
 196-7   not required for debt service shall be allocated as provided by
 196-8   Section 404.071.  (V.A.C.S. Art. 601d-1, Sec. 5(d).)
 196-9         Sec. 1401.064.  PAYMENT OF PRINCIPAL OR INTEREST.  The board
196-10   may provide that the principal of and interest on revenue bonds
196-11   issued under this subchapter be paid from any source of funds
196-12   lawfully available to the board.  (V.A.C.S. Art. 601d-1, Sec. 5(e)
196-13   (part).)
196-14         Sec. 1401.065.  BOND REQUIREMENTS.  Revenue bonds issued
196-15   under this subchapter are subject to Sections 1232.117 and
196-16   1232.118.  (V.A.C.S. Art. 601d-1, Sec. 5(g).)
196-17           (Sections 1401.066-1401.080 reserved for expansion)
196-18                  SUBCHAPTER E.  REVENUE BOND PROJECTS
196-19         Sec. 1401.081.  CONDITIONS FOR BEGINNING PROJECT.  The
196-20   appropriate agency may begin an approved project financed under
196-21   Subchapter D after:
196-22               (1)  the authority has certified that the authority has
196-23   authorized obligations in an amount sufficient to pay the
196-24   construction or purchase price of the project under an interim
196-25   construction finance agreement established by the authority in
196-26   accordance with Chapter 1371; or
196-27               (2)  the following conditions are met:
 197-1                     (A)  the revenue bond proceeds are deposited;
 197-2                     (B)  the comptroller has certified that the funds
 197-3   are available;
 197-4                     (C)  any reserve funds or capitalized interest
 197-5   certified to be reasonably required by the authority has been
 197-6   transferred; and
 197-7                     (D)  according to the authority's statement that
 197-8   specifies those costs, the costs of issuance of the bonds have been
 197-9   paid. (V.A.C.S. Art. 601d-1, Sec.  5(c).)
197-10         Sec. 1401.082.  REVENUE BOND REPAYMENT AND LEASE AGREEMENT.
197-11   (a)  In accordance with a lease agreement, the appropriate agency,
197-12   with money appropriated for the purpose, shall pay to the board an
197-13   amount the board determines to be sufficient to:
197-14               (1)  pay the principal of and interest on the bonds
197-15   issued under Section 1401.061;
197-16               (2)  maintain a reserve fund necessary to service the
197-17   debt; and
197-18               (3)  reimburse the authority for other costs and
197-19   expenses relating to:
197-20                     (A)  a project; or
197-21                     (B)  the outstanding bonds.
197-22         (b)  For purposes of this section, a state agency may enter
197-23   into a lease agreement in the name of and on behalf of the state.
197-24         (c)  A state agency shall include in its biennial
197-25   appropriation request an amount sufficient to pay the principal of
197-26   and interest on outstanding bonds issued under Section 1401.061 for
197-27   the agency.  (V.A.C.S. Art. 601d-1, Secs.  5(f), (h) (part).)
 198-1         Sec. 1401.083.  RIGHTS TO FINANCED PROPERTY.  (a)  Property
 198-2   financed by the authority under Subchapter D does not become part
 198-3   of other property to which it is attached or affixed or into which
 198-4   it is incorporated, regardless of whether the other property is
 198-5   real or personal.
 198-6         (b)  A state agency has the rights of a lessee in property
 198-7   financed by the authority under Subchapter D.  A person who claims
 198-8   under or through the agency may not acquire any greater rights with
 198-9   respect to the property.  (V.A.C.S.  Art. 601d-1, Sec. 5(i).)
198-10           (Sections 1401.084-1401.100 reserved for expansion)
198-11                   SUBCHAPTER F.  FINANCIAL PROVISIONS
198-12         Sec. 1401.101.  RESTRICTION ON AMOUNT OF OUTSTANDING BONDS.
198-13   The combined amount of outstanding revenue bonds and outstanding
198-14   general obligation bonds issued under this chapter may not exceed
198-15   $900 million.  (V.A.C.S. Art. 601d-1, Sec. 6.)
198-16         Sec. 1401.102.  EXEMPTION FROM TAXATION.  A bond issued under
198-17   this chapter, any transaction related to the bond, and profits made
198-18   in the sale of the bond are exempt from taxation by this state, a
198-19   state agency, or a municipality or other political subdivision of
198-20   this state.  (V.A.C.S. Art. 601d-1, Sec. 9.)
198-21           (Sections 1401.103-1401.120 reserved for expansion)
198-22                 SUBCHAPTER G.  MISCELLANEOUS PROVISIONS
198-23         Sec. 1401.121.  TEXAS DEPARTMENT OF CRIMINAL JUSTICE MASTER
198-24   PLAN.  (a)  Unless the institutional division of the Texas
198-25   Department of Criminal Justice has submitted to the Bond Review
198-26   Board a master plan for the construction of corrections facilities,
198-27   the proceeds of bonds issued under this chapter may not be:
 199-1               (1)  distributed to the division; or
 199-2               (2)  used to finance a project of the division.
 199-3         (b)  The master plan must:
 199-4               (1)  be in the form, contain the information, and cover
 199-5   the period prescribed by the Bond Review Board; and
 199-6               (2)  be revised annually.  (V.A.C.S. Art. 601d-1, Sec.
 199-7   3.)
 199-8         Sec. 1401.122.  HISTORICALLY UNDERUTILIZED BUSINESS
 199-9   ASSISTANCE.  (a)  In this section, "historically underutilized
199-10   business" means a business entity that is formed for the purpose of
199-11   making a profit:
199-12               (1)  at least 51 percent of which is owned by one or
199-13   more individuals, each of whom is socially disadvantaged because of
199-14   identification as a member of a group that has suffered the effects
199-15   of a discriminatory practice or similar insidious circumstance over
199-16   which the group has no control, including women, African Americans,
199-17   Hispanic Americans, Native Americans, and Asian Americans; or
199-18               (2)  at least 51 percent of all classes of the shares
199-19   of stock or other equitable securities of which is owned by one or
199-20   more individuals, each of whom:
199-21                     (A)  is socially disadvantaged for a reason
199-22   described by Subdivision (1); and
199-23                     (B)  has a proportionate interest in the control,
199-24   operation, and management of the corporation's affairs.
199-25         (b)  The authority shall make a good faith effort to use
199-26   historically underutilized businesses to assist in the issuance of
199-27   at least 30 percent of the total value of the bonds authorized by
 200-1   Section 1401.041(d)(1).
 200-2         (c)  The authority shall report to the legislature and the
 200-3   governor the level of historically underutilized business
 200-4   participation in the bond issuance.  (V.A.C.S. Art. 601d-1, Sec.
 200-5   4(a)(5).)
 200-6           CHAPTER 1402.  PUBLIC SCHOOL FACILITIES FUNDING ACT
 200-7                    SUBCHAPTER A.  GENERAL PROVISIONS
 200-8   Sec. 1402.001.  SHORT TITLE
 200-9   Sec. 1402.002.  DEFINITIONS
200-10   Sec. 1402.003.  LIBERAL CONSTRUCTION
200-11           (Sections 1402.004-1402.020 reserved for expansion)
200-12                SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
200-13   Sec. 1402.021.  BOARD MEETINGS
200-14   Sec. 1402.022.  DESIGNATED REPRESENTATIVE OF BOARD MEMBER
200-15   Sec. 1402.023.  MAJORITY VOTE REQUIRED
200-16   Sec. 1402.024.  BOARD ADMINISTRATION
200-17   Sec. 1402.025.  COMPREHENSIVE STUDIES BY BOARD
200-18   Sec. 1402.026.  ACCOUNTING AND FUNDS MANAGEMENT
200-19   Sec. 1402.027.  BOARD RULES
200-20           (Sections 1402.028-1402.040 reserved for expansion)
200-21                SUBCHAPTER C.  SCHOOL FACILITIES AID FUND
200-22   Sec. 1402.041.  SCHOOL FACILITIES AID FUND
200-23   Sec. 1402.042.  USE OF MONEY IN FUND
200-24   Sec. 1402.043.  COMMINGLING PROHIBITED
200-25   Sec. 1402.044.  FUND REVENUE
200-26   Sec. 1402.045.  ACCOUNTS IN FUND
200-27           (Sections 1402.046-1402.060 reserved for expansion)
 201-1            SUBCHAPTER D.  SCHOOL FACILITIES AID RESERVE FUND
 201-2   Sec. 1402.061.  AUTHORITY TO ESTABLISH RESERVE FUND
 201-3   Sec. 1402.062.  REQUIRED DEBT SERVICE RESERVE DEFINED
 201-4   Sec. 1402.063.  SEPARATE ACCOUNTS IN RESERVE
 201-5                     FUND
 201-6   Sec. 1402.064.  USE OF MONEY IN RESERVE FUND
 201-7   Sec. 1402.065.  TRANSFER OF MONEY
 201-8   Sec. 1402.066.  CERTIFICATION BY BOARD OF AMOUNTS NECESSARY
 201-9                     TO RESTORE RESERVE FUND
201-10           (Sections 1402.067-1402.080 reserved for expansion)
201-11                 SUBCHAPTER E.  BONDS AND BOND PROCEEDS
201-12   Sec. 1402.081.  ISSUANCE OF BONDS; LIMITATION ON AMOUNT
201-13                     OUTSTANDING
201-14   Sec. 1402.082.  AMOUNT AND DELIVERY DATE OF BOND PROCEEDS
201-15   Sec. 1402.083.  SOURCE OF BOND PAYMENTS
201-16   Sec. 1402.084.  APPROVAL AND FORM OF BONDS
201-17   Sec. 1402.085.  INVESTMENT OF BOND PROCEEDS
201-18   Sec. 1402.086.  ADDITIONAL RIGHTS AND POWERS OF COMPTROLLER
201-19   Sec. 1402.087.  GUARANTEE OF BONDS
201-20           (Sections 1402.088-1402.100 reserved for expansion)
201-21                   SUBCHAPTER F.  ELIGIBILITY FOR AID
201-22   Sec. 1402.101.  CONDITIONS FOR ELIGIBILITY
201-23   Sec. 1402.102.  PERIOD OF QUALIFICATION FOR AID
201-24   Sec. 1402.103.  APPLICATION FOR AID
201-25           (Sections 1402.104-1402.120 reserved for expansion)
201-26                 SUBCHAPTER G.  AID TO SCHOOL DISTRICTS
201-27   Sec. 1402.121.  FORM OF AID
 202-1   Sec. 1402.122.  BOND PURCHASE PROCEDURE
 202-2   Sec. 1402.123.  AID FOR CAPITAL ASSETS AND MAINTENANCE
 202-3   Sec. 1402.124.  AID FOR INSTRUCTIONAL FACILITIES
 202-4   Sec. 1402.125.  CONDITION ON AID; SCHOOL DISTRICT FUNDS
 202-5   Sec. 1402.126.  RESTRICTIONS ON USE OF AID
 202-6   Sec. 1402.127.  LIMIT ON AMOUNT OF AID
 202-7   Sec. 1402.128.  QUALIFICATION STANDARDS FOR CAPITAL ASSETS
 202-8                     AND INSTRUCTIONAL FACILITIES
 202-9           (Sections 1402.129-1402.140 reserved for expansion)
202-10         SUBCHAPTER H.  REPAYMENT BY SCHOOL DISTRICTS; SECURITY
202-11   Sec. 1402.141.  REPAYMENT OF BONDS PURCHASED BY BOARD
202-12   Sec. 1402.142.  NOTICE BY COMPTROLLER OF FAILURE TO MAKE
202-13                     TIMELY PAYMENT
202-14   Sec. 1402.143.  DEDUCTION FROM FOUNDATION SCHOOL FUND
202-15                     PAYMENTS
202-16   Sec. 1402.144.  DELINQUENCY ON GUARANTEED BOND; TRANSFER FROM
202-17                     PERMANENT SCHOOL FUND
202-18           CHAPTER 1402.  PUBLIC SCHOOL FACILITIES FUNDING ACT
202-19                    SUBCHAPTER A.  GENERAL PROVISIONS
202-20         Sec. 1402.001.  SHORT TITLE.  This chapter may be cited as
202-21   the Public School Facilities Funding Act.  (V.A.C.S. Art. 717t,
202-22   Sec. 1.)
202-23         Sec. 1402.002.  DEFINITIONS.  In this chapter:
202-24               (1)  "Agency" means the Texas Education Agency.
202-25               (2)  "Aid" means:
202-26                     (A)  making a loan to a qualifying district; or
202-27                     (B)  purchasing a bond issued by a qualifying
 203-1   district.
 203-2               (3)  "Board" means the Bond Review Board.
 203-3               (4)  "Bond" includes a note or other obligation.
 203-4               (5)  "Capital asset" means:
 203-5                     (A)  a permanent fixture, including mechanical or
 203-6   electrical equipment, of an instructional facility; or
 203-7                     (B)  furnishings or equipment of an instructional
 203-8   facility.
 203-9               (6)  "Fund" means the school facilities aid fund under
203-10   Subchapter C, including any account created in that fund.
203-11               (7)  "Instructional facility" means real property, a
203-12   building or other improvement to real property, or a fixture used
203-13   predominately for teaching or required by state law.
203-14               (8)  "Qualifying district" means a school district that
203-15   qualifies for financial assistance under this chapter.
203-16               (9)  "Reserve fund" means the school facilities aid
203-17   reserve fund under Subchapter D and includes any account created in
203-18   that fund. (V.A.C.S. Art. 717t, Sec. 2; New.)
203-19         Sec. 1402.003.  LIBERAL CONSTRUCTION.  This chapter shall be
203-20   construed liberally to effect its purpose.  (V.A.C.S. Art. 717t,
203-21   Sec. 4 (part).)
203-22           (Sections 1402.004-1402.020 reserved for expansion)
203-23                SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
203-24         Sec. 1402.021.  BOARD MEETINGS.  The board shall meet at
203-25   times that are agreed to by a majority of its members but at least
203-26   once each year to consider applications for aid and to transact any
203-27   other business.  (V.A.C.S. Art. 717t, Sec. 5(a) (part).)
 204-1         Sec. 1402.022.  DESIGNATED REPRESENTATIVE OF BOARD MEMBER.  A
 204-2   member of the board may designate a person on the member's staff to
 204-3   act in the member's place as a voting member of the board in all
 204-4   respects.  (V.A.C.S. Art. 717t, Sec. 5(a) (part).)
 204-5         Sec. 1402.023.  MAJORITY VOTE REQUIRED.  An affirmative vote
 204-6   of a majority of the board is necessary for an action of the board,
 204-7   including the approval of a resolution or another proceeding, to be
 204-8   effective.  (V.A.C.S. Art. 717t, Sec. 5(a) (part).)
 204-9         Sec. 1402.024.  BOARD ADMINISTRATION.  (a)  The board may:
204-10               (1)  use the resources and staff of its members; and
204-11               (2)  employ, appoint, or contract with employees,
204-12   consultants, and agents, including engineers, attorneys, management
204-13   consultants, financial advisors, and other providers of
204-14   professional assistance.
204-15         (b)  Money in the fund may be used to pay administrative
204-16   costs of the board relating to the performance of its duties under
204-17   this chapter, including compensation of an employee, agent,
204-18   consultant, or contractor.  (V.A.C.S. Art. 717t, Sec. 5(b) (part).)
204-19         Sec. 1402.025.  COMPREHENSIVE STUDIES BY BOARD.  The board
204-20   may commission or enter into an interagency agreement to undertake
204-21   a comprehensive study of the needs of school districts in all or
204-22   part of the state for:
204-23               (1)  the acquisition, construction, renovation, major
204-24   repair, remodeling, retrofitting, or improvement of capital assets
204-25   and instructional facilities; or
204-26               (2)  assistance in paying maintenance expenses.
204-27   (V.A.C.S. Art. 717t, Secs. 5(c), 6(a) (part).)
 205-1         Sec. 1402.026.  ACCOUNTING AND FUNDS MANAGEMENT.  The
 205-2   comptroller shall perform as directed by the board any accounting
 205-3   or funds management duty allowed or required by this chapter.
 205-4   (V.A.C.S. Art. 717t, Sec. 5(d) (part).)
 205-5         Sec. 1402.027.  BOARD RULES.  The board may adopt rules to
 205-6   administer this chapter.  (V.A.C.S. Art. 717t, Sec. 5(d) (part).)
 205-7           (Sections 1402.028-1402.040 reserved for expansion)
 205-8                SUBCHAPTER C.  SCHOOL FACILITIES AID FUND
 205-9         Sec. 1402.041.  SCHOOL FACILITIES AID FUND.  (a)  The fund is
205-10   a revolving fund in the state treasury.
205-11         (b)  The comptroller shall administer the fund as directed by
205-12   the board under this chapter and board rule. (V.A.C.S. Art. 717t,
205-13   Sec. 6(a) (part).)
205-14         Sec. 1402.042.  USE OF MONEY IN FUND.  (a)  Money in the fund
205-15   may only be used to:
205-16               (1)  purchase bonds of a qualifying district or to make
205-17   a loan to a qualifying district for:
205-18                     (A)  an expense related to the acquisition,
205-19   construction, renovation, major repair, remodeling, retrofitting,
205-20   maintenance, or improvement of a qualifying capital asset or an
205-21   instructional facility that meets the board's standards for
205-22   qualification under this chapter; or
205-23                     (B)  the funding of a cash-management program or
205-24   another short-term borrowing need for maintenance;
205-25               (2)  aid a district in the issuance of bonds;
205-26               (3)  pay administrative costs relating to the
205-27   performance of a duty under this chapter;
 206-1               (4)  pay the issuance cost, interest, principal, and
 206-2   any premium on a bond issued under this chapter;
 206-3               (5)  make a transfer to the reserve fund required by
 206-4   board resolution; or
 206-5               (6)  pay the cost of a study undertaken under Section
 206-6   1402.025.
 206-7         (b)  Except for aid for a maintenance expense or to the
 206-8   extent directly related to the acquisition, construction,
 206-9   renovation, major repair, remodeling, retrofitting, or improvement
206-10   of a qualifying capital asset or instructional facility, money in
206-11   the fund may not be used to pay:
206-12               (1)  a general administrative expense of a school
206-13   district; or
206-14               (2)  any part of the salary or benefits of an official
206-15   or employee of a school district receiving aid under this chapter.
206-16   (V.A.C.S.  Art. 717t, Secs. 6(a) (part), (c) (part), (d).)
206-17         Sec. 1402.043.  COMMINGLING PROHIBITED.  Except as provided
206-18   by this chapter, money in the fund may not be commingled or
206-19   deposited to the credit of another fund in the state treasury.
206-20   (V.A.C.S. Art. 717t, Sec. 6(a) (part).)
206-21         Sec. 1402.044.  FUND REVENUE.  The board shall require to be
206-22   deposited to the credit of the fund:
206-23               (1)  the proceeds of a bond issued under this chapter
206-24   that are not required to be deposited to the credit of the reserve
206-25   fund, exclusive of the cost of issuance;
206-26               (2)  any money received from the United States or from
206-27   a private source that is designated for a purpose of the fund;
 207-1               (3)  any repayment, interest, principal, or other
 207-2   amount received in connection with aid provided under this chapter;
 207-3               (4)  any investment security or bond purchased by the
 207-4   fund or held for a purpose of this chapter;
 207-5               (5)  interest or other earnings derived from the
 207-6   investment of an amount described by Subdivision (1), (2), or (3);
 207-7   and
 207-8               (6)  any amount transferred for deposit to the credit
 207-9   of the fund. (V.A.C.S. Art. 717t, Sec. 6(b).)
207-10         Sec. 1402.045.  ACCOUNTS IN FUND.  (a)  The board may:
207-11               (1)  direct the comptroller to create accounts in the
207-12   fund as advisable;
207-13               (2)  in the resolution authorizing the issuance of
207-14   bonds, dedicate one or more accounts, including future amounts to
207-15   be deposited in an account, to the payment of debt service on one
207-16   or more series of bonds issued under this chapter; and
207-17               (3)  direct the comptroller to pledge one or more
207-18   accounts in the fund as security for a bond issued under this
207-19   chapter.
207-20         (b)  The comptroller shall:
207-21               (1)  keep each account separate from each other account
207-22   in the fund; and
207-23               (2)  credit each account with each amount the board
207-24   transfers or dedicates to it.  (V.A.C.S. Art. 717t, Sec. 6(e).)
207-25           (Sections 1402.046-1402.060 reserved for expansion)
207-26            SUBCHAPTER D.  SCHOOL FACILITIES AID RESERVE FUND
207-27         Sec. 1402.061.  AUTHORITY TO ESTABLISH RESERVE FUND.
 208-1   (a)  The board may direct the comptroller to create a school
 208-2   facilities aid reserve fund in the state treasury.
 208-3         (b)  The board may direct the comptroller to deposit to the
 208-4   credit of the reserve fund:
 208-5               (1)  the proceeds of a bond issued under this chapter;
 208-6               (2)  any payment of interest or principal from aid
 208-7   granted under this chapter; and
 208-8               (3)  any other amount that may be transferred from the
 208-9   fund that the board by resolution requires to be deposited to the
208-10   credit of the reserve fund. (V.A.C.S. Art. 717t, Sec. 7(a) (part).)
208-11         Sec. 1402.062.  REQUIRED DEBT SERVICE RESERVE DEFINED.  (a)
208-12   In this subchapter, "required debt service reserve" means, as of
208-13   the date of computation, the amount required to be on deposit in
208-14   the reserve fund or an account in the reserve fund as provided by
208-15   board resolution.
208-16         (b)  In computing the amount of the required debt service
208-17   reserve, an investment shall be valued in the manner determined by
208-18   board resolution. (V.A.C.S. Art. 717t, Sec. 7(a) (part).)
208-19         Sec. 1402.063.  SEPARATE ACCOUNTS IN RESERVE FUND.  (a)  The
208-20   board may direct the comptroller to create accounts in the reserve
208-21   fund as advisable.
208-22         (b)  The comptroller shall:
208-23               (1)  keep each account separate from each other account
208-24   in the reserve fund; and
208-25               (2)  credit each account with each amount the board
208-26   transfers or dedicates to it.
208-27         (c)  The board may pledge one or more accounts in the reserve
 209-1   fund, including future amounts to be deposited to the credit of the
 209-2   account, as security for one or more series of bonds issued under
 209-3   this chapter.
 209-4         (d)  Additional bonds secured or benefited by an account in
 209-5   the reserve fund may not be issued unless at that time the
 209-6   appropriate account in the reserve fund contains the required debt
 209-7   service reserve for all bonds then outstanding and secured or
 209-8   benefited by that account.
 209-9         (e)  The debt service reserve requirement of Subsection (d)
209-10   may be met by:
209-11               (1)  depositing as much of the proceeds of the bonds to
209-12   be issued, on their issuance, as is needed to equal the required
209-13   debt service reserve; or
209-14               (2)  transferring money, surety bonds, or credit
209-15   agreements on deposit in the fund. (V.A.C.S. Art. 717t, Secs. 7(c)
209-16   (part), (e).)
209-17         Sec. 1402.064.  USE OF MONEY IN RESERVE FUND.  (a)  Money in
209-18   the reserve fund shall be held and directly or by transfer to the
209-19   fund applied solely to the payment of the principal or redemption
209-20   price of and interest on bonds issued under this chapter as they
209-21   become due and payable.
209-22         (b)  Except as provided by Subsection (a), money may not be
209-23   removed from the reserve fund or an account in the reserve fund if
209-24   that action would reduce the amount in the reserve fund or that
209-25   account to less than the required debt service reserve. (V.A.C.S.
209-26   Art. 717t, Sec. 7(a) (part).)
209-27         Sec. 1402.065.  TRANSFER OF MONEY.  Money in the reserve fund
 210-1   or an account in the reserve fund in excess of the required debt
 210-2   service reserve may be withdrawn by board resolution and
 210-3   transferred to:
 210-4               (1)  the fund or to an account in the fund; or
 210-5               (2)  another account in the reserve fund. (V.A.C.S.
 210-6   Art. 717t, Sec. 7(b).)
 210-7         Sec. 1402.066.  CERTIFICATION BY BOARD OF AMOUNTS NECESSARY
 210-8   TO RESTORE RESERVE FUND.  If an additional amount of money is
 210-9   necessary to restore the reserve fund to an amount equal to the
210-10   required debt service reserve:
210-11               (1)  the board may certify that fact to the
210-12   legislature; and
210-13               (2)  the legislature may appropriate to the board for
210-14   deposit to the credit of the fund or reserve fund the amount
210-15   certified by the board. (V.A.C.S. Art. 717t, Sec. 7(d) (part).)
210-16           (Sections 1402.067-1402.080 reserved for expansion)
210-17                 SUBCHAPTER E.  BONDS AND BOND PROCEEDS
210-18         Sec. 1402.081.  ISSUANCE OF BONDS; LIMITATION ON AMOUNT
210-19   OUTSTANDING.  (a)  The board by resolution may provide for the
210-20   issuance of revenue bonds for a purpose of this chapter.
210-21         (b)  The amount of bonds outstanding at any time may not
210-22   exceed $750 million.  Bonds that are or have been refunded do not
210-23   count against that limit.  (V.A.C.S. Art. 717t, Secs. 8(a) (part),
210-24   (d) (part).)
210-25         Sec. 1402.082.  AMOUNT AND DELIVERY DATE OF BOND PROCEEDS.
210-26   The board may specify a principal amount and a date of delivery of
210-27   proceeds of bonds issued under this chapter. (V.A.C.S. Art. 717t,
 211-1   Sec.  8(a) (part).)
 211-2         Sec. 1402.083.  SOURCE OF BOND PAYMENTS.  (a)  A revenue bond
 211-3   issued under this chapter is a special obligation of the state
 211-4   payable only from amounts in or to be received for deposit to the
 211-5   credit of the fund, the reserve fund, or an account created within
 211-6   the fund or the reserve fund, as designated by the board in the
 211-7   resolution authorizing the issuance of the bond, including:
 211-8               (1)  principal and interest paid and to be paid on a
 211-9   security or another obligation held by the board;
211-10               (2)  income from an account created in the fund or
211-11   reserve fund by the board; or
211-12               (3)  money from any other source that may be available
211-13   to and designated by the board for that purpose.
211-14         (b)  A bond issued under this chapter:
211-15               (1)  is not debt of the state prohibited by the Texas
211-16   Constitution; and
211-17               (2)  must contain on its face a statement to the effect
211-18   that:
211-19                     (A)  the state is obligated to pay the principal
211-20   of and the interest on the bond solely from money in or to be
211-21   received for deposit to the credit of the fund or the reserve fund;
211-22   and
211-23                     (B)  the full faith and credit and the taxing
211-24   power of the state are not pledged, given, or loaned to secure
211-25   those payments.  (V.A.C.S. Art. 717t, Sec. 8(b).)
211-26         Sec. 1402.084.  APPROVAL AND FORM OF BONDS.  (a)  A bond
211-27   issued under this chapter:
 212-1               (1)  must be approved in the same manner as other bonds
 212-2   issued by the state; and
 212-3               (2)  may bear any designation directed by board
 212-4   resolution.
 212-5         (b)  The comptroller shall issue bonds authorized and
 212-6   approved by the board.
 212-7         (c)  A bond issued under this chapter may:
 212-8               (1)  be dated;
 212-9               (2)  mature not later than 50 years after its date of
212-10   issuance;
212-11               (3)  be issued in permanent or temporary form;
212-12               (4)  be sold at a public or private sale, whether
212-13   competitive or negotiated, and under terms determined to be the
212-14   most advantageous reasonably attainable; and
212-15               (5)  be issued on a parity with and be secured in the
212-16   manner as other bonds issued or authorized to be issued by this
212-17   chapter or be issued not on a parity with and secured differently
212-18   from other bonds issued under this chapter. (V.A.C.S. Art. 717t,
212-19   Secs. 5(d) (part), 8(a) (part), (d) (part), (e) (part), (f)
212-20   (part).)
212-21         Sec. 1402.085.  INVESTMENT OF BOND PROCEEDS.  Proceeds from
212-22   the sale of  bonds issued under this chapter may be invested in any
212-23   manner and in any obligation or security specified in the
212-24   resolution authorizing the bonds or in a supplemental board
212-25   resolution. (V.A.C.S. Art. 717t, Sec. 8(g).)
212-26         Sec. 1402.086.  ADDITIONAL RIGHTS AND POWERS OF COMPTROLLER.
212-27   In connection with the issuance and administration of bonds under
 213-1   this chapter, in addition to a power granted by this chapter, the
 213-2   comptroller may exercise any right or power granted to:
 213-3               (1)  the housing finance division of the Texas
 213-4   Department of Housing and Community Affairs by Chapter 2306; or
 213-5               (2)  an issuer by Chapter 1201, 1207, or 1371.
 213-6   (V.A.C.S. Art. 717t, Sec.  8(h).)
 213-7         Sec. 1402.087.  GUARANTEE OF BONDS.  (a)  The permanent
 213-8   school fund and the income from the permanent school fund may be
 213-9   used to guarantee bonds issued under this chapter.
213-10         (b)  The board may apply to the commissioner of education at
213-11   any time for a guarantee of all or part of a bond authorized under
213-12   this chapter in the same manner as a school district or in another
213-13   manner agreed to by the board and commissioner.
213-14         (c)  If a payment is required to be made by the permanent
213-15   school fund as a result of the guarantee of bonds issued under this
213-16   chapter, an amount equal to that payment shall be paid immediately
213-17   by the state from the state treasury to the permanent school fund.
213-18         (d)  As soon as practicable the board shall reimburse the
213-19   state treasury for any amount required to be paid to the permanent
213-20   school fund as a result of the guarantee by that fund of bonds
213-21   issued under this chapter.
213-22         (e)  An amount owed by the state to the permanent school fund
213-23   under this section is a general obligation of the state until paid.
213-24   (V.A.C.S. Art. 717t, Sec. 9.)
213-25           (Sections 1402.088-1402.100 reserved for expansion)
213-26                   SUBCHAPTER F.  ELIGIBILITY FOR AID
213-27         Sec. 1402.101.  CONDITIONS FOR ELIGIBILITY.  (a)  The board
 214-1   shall adopt rules relating to qualification for aid under this
 214-2   chapter.  In adopting a rule or awarding aid, the board may
 214-3   consider whether a school district:
 214-4               (1)  has been cited by the agency in its most recent
 214-5   accreditation report as having inadequate facilities;
 214-6               (2)  has failed to meet a legally required
 214-7   teacher-to-student ratio during its most recent accreditation
 214-8   period;
 214-9               (3)  has experienced a rapid growth in the number of
214-10   students in average daily attendance or is projected to experience
214-11   that growth over the next five years;
214-12               (4)  has over the preceding five years increased the
214-13   tax burden on property located in the district at a greater rate
214-14   than the state average or the average of surrounding districts;
214-15               (5)  has a debt service tax rate greater than the state
214-16   average for school districts or greater than the average of
214-17   surrounding districts;
214-18               (6)  has a property-wealth per student ratio inadequate
214-19   to meet the demands for adequate funds for a quality general
214-20   education program and for its bonded debt obligations;
214-21               (7)  has the ability to repay any aid granted,
214-22   considering the district's tax base and outstanding debts; and
214-23               (8)  meets any other condition that the board believes
214-24   should qualify a district for aid under this chapter.
214-25         (b)  For purposes of Subsection (a)(2), a school district is
214-26   considered to have failed to meet a required teacher-to-student
214-27   ratio if the district has requested and obtained a waiver of that
 215-1   requirement in its most recent accreditation period.  (V.A.C.S.
 215-2   Art. 717t, Sec. 10(a).)
 215-3         Sec. 1402.102.  PERIOD OF QUALIFICATION FOR AID.  A school
 215-4   district that qualifies for aid under this chapter at the time it
 215-5   applies to the board:
 215-6               (1)  continues to qualify for aid until the application
 215-7   is acted on; and
 215-8               (2)  may receive aid as awarded by the board but may
 215-9   not receive additional aid for any academic year in which it does
215-10   not or would not qualify.  (V.A.C.S. Art. 717t, Sec. 10(b).)
215-11         Sec. 1402.103.  APPLICATION FOR AID.  (a)  A school district
215-12   shall submit its application for aid under this chapter in the time
215-13   period the board reasonably requires of all applicants.
215-14         (b)  The board may require additional information from any
215-15   applicant.
215-16         (c)  The agency shall:
215-17               (1)  assist the board in evaluating applications for
215-18   aid under this chapter;
215-19               (2)  review the financial condition of each district
215-20   applying for aid; and
215-21               (3)  annually report to the board as to the capacity of
215-22   each district that has been granted aid to timely repay that aid.
215-23   (V.A.C.S.  Art. 717t, Sec. 10(c).)
215-24           (Sections 1402.104-1402.120 reserved for expansion)
215-25                 SUBCHAPTER G.  AID TO SCHOOL DISTRICTS
215-26         Sec. 1402.121.  FORM OF AID.  (a)  The board may provide aid
215-27   to a qualifying district by purchasing at the price determined by
 216-1   the board:
 216-2               (1)  a bond of the district issued under Chapter 45,
 216-3   Education Code, including bonds guaranteed by the permanent school
 216-4   fund under Subchapter C of that chapter;
 216-5               (2)  a contractual obligation issued by the district
 216-6   under Subchapter A, Chapter 271, Local Government Code; or
 216-7               (3)  a bond of the district issued to refund a current
 216-8   outstanding obligation of the district if:
 216-9                     (A)  the current outstanding obligation or the
216-10   portion of the obligation refunded was used in a manner that would
216-11   qualify for aid under this chapter; and
216-12                     (B)  application is made and approved in the
216-13   manner provided for other aid under this chapter.
216-14         (b)  A qualifying district may borrow from the fund by
216-15   selling one or more of its bonds to the board. (V.A.C.S. Art. 717t,
216-16   Secs.  11(a), (b) (part).)
216-17         Sec. 1402.122.  BOND PURCHASE PROCEDURE.  (a)  The board may:
216-18               (1)  purchase all or part of an issue of a qualifying
216-19   district's bonds, including refunding bonds; and
216-20               (2)  require by rule that bonds purchased by the board
216-21   contain specified terms and provisions.
216-22         (b)  Any school district may request from the board an
216-23   advisory statement as to whether the board will consider purchasing
216-24   one or more of the school district's bonds.  The request must
216-25   contain all information reasonably required by the board.
216-26         (c)  Notwithstanding any provision of law to the contrary,
216-27   the board may acquire a bond issued by a qualifying district in a
 217-1   public or private sale with or without competitive bidding as
 217-2   provided by resolution or order of the governing body of the
 217-3   district.  The requirement of Section 45.001, Education Code, that
 217-4   bonds of a school district be sold to the highest bidder does not
 217-5   apply to a purchase by the board.
 217-6         (d)  The resolution or order may designate an officer or
 217-7   employee of the district to act on behalf of the district to set
 217-8   the price, interest rate, and date for the sale of the bonds.
 217-9   (V.A.C.S.  Art. 717t, Secs. 11(c), (d).)
217-10         Sec. 1402.123.  AID FOR CAPITAL ASSETS AND MAINTENANCE.  (a)
217-11   The board by rule may:
217-12               (1)  establish formulas that provide for loans or other
217-13   aid for the acquisition, construction, renovation, major repair,
217-14   remodeling, retrofitting, and improvement of capital assets and for
217-15   cash management and short-term borrowing needs for maintenance
217-16   expenses; and
217-17               (2)  provide for different classes of capital assets
217-18   and establish different criteria for awarding aid to each class.
217-19         (b)  In determining whether to award aid to a school
217-20   district, the board shall consider the type of capital asset for
217-21   which aid is requested and the needs of the district. (V.A.C.S.
217-22   Art. 717t, Sec. 11(e).)
217-23         Sec. 1402.124.  AID FOR INSTRUCTIONAL FACILITIES.  (a)  The
217-24   board by rule may:
217-25               (1)  establish formulas that provide for loans or other
217-26   aid for the acquisition, construction, renovation, major repair,
217-27   remodeling, retrofitting, and improvement of instructional
 218-1   facilities; and
 218-2               (2)  provide for different classes of facilities or
 218-3   facility improvements and establish different criteria for awarding
 218-4   aid to each class.
 218-5         (b)  In determining whether to award aid to a school
 218-6   district, the board shall consider:
 218-7               (1)  the type of facility acquisition, construction,
 218-8   renovation, major repair, remodeling, retrofitting, or improvement
 218-9   requested;
218-10               (2)  the proposed use of the facility or improvement;
218-11   and
218-12               (3)  the needs of the district.  (V.A.C.S. Art. 717t,
218-13   Sec. 11(f).)
218-14         Sec. 1402.125.  CONDITION ON AID; SCHOOL DISTRICT FUNDS.  The
218-15   board may condition aid to a qualifying district by requiring that
218-16   district to provide money for the related acquisition,
218-17   construction, renovation, major repair, remodeling, retrofitting,
218-18   or improvement in the amount set by the board. (V.A.C.S. Art. 717t,
218-19   Sec. 11(g).)
218-20         Sec. 1402.126.  RESTRICTIONS ON USE OF AID.  (a)  The board
218-21   shall require each school district that receives aid to spend the
218-22   aid and any independent funds the board requires to be provided by
218-23   the district exclusively on the project for which the aid is
218-24   awarded.
218-25         (b)  The board by rule may establish a procedure by which a
218-26   school district that receives aid may apply to the board for
218-27   permission to use the aid provided and any required independent
 219-1   funds for a different purpose.  The board may grant the permission
 219-2   if it finds that the alternative use proposed would have qualified
 219-3   for at least the same amount and type of aid.
 219-4         (c)  The agency shall assist the board in monitoring the use
 219-5   of aid awarded under this chapter. (V.A.C.S. Art. 717t, Sec.
 219-6   11(h).)
 219-7         Sec. 1402.127.  LIMIT ON AMOUNT OF AID.  To ensure that all
 219-8   qualifying districts may be considered for aid, the board by rule
 219-9   may limit the amount of aid that any one qualifying district may
219-10   receive in a specified number of years. (V.A.C.S. Art. 717t, Sec.
219-11   11(i).)
219-12         Sec. 1402.128.  QUALIFICATION STANDARDS FOR CAPITAL ASSETS
219-13   AND INSTRUCTIONAL FACILITIES.  (a)  The board shall adopt standards
219-14   for a qualifying capital asset or instructional facility.  The
219-15   standards must be based on the reasonable cost and useful life of
219-16   the asset or facility.
219-17         (b)  The board may adopt rules to determine the useful life
219-18   of a capital asset or instructional facility. (V.A.C.S. Art. 717t,
219-19   Sec. 13.)
219-20           (Sections 1402.129-1402.140 reserved for expansion)
219-21         SUBCHAPTER H.  REPAYMENT BY SCHOOL DISTRICTS; SECURITY
219-22         Sec. 1402.141.  REPAYMENT OF BONDS PURCHASED BY BOARD.  A
219-23   school district shall make each payment of principal or interest on
219-24   an obligation purchased by the board directly to the comptroller
219-25   for deposit to the credit of the fund.  (V.A.C.S. Art. 717t, Sec.
219-26   12(a).)
219-27         Sec. 1402.142.  NOTICE BY COMPTROLLER OF FAILURE TO MAKE
 220-1   TIMELY PAYMENT.  (a)  The comptroller shall:
 220-2               (1)  notify the board and the commissioner of education
 220-3   if the comptroller is notified by a school district that the
 220-4   district will not make a timely payment on a loan made to the
 220-5   district under this chapter; and
 220-6               (2)  notify the board, the commissioner, and the school
 220-7   district if a school district fails to make a timely payment of
 220-8   principal or interest due on a loan made to the district under this
 220-9   chapter.
220-10         (b)  Notice to a school district under Subsection (a)(2) must
220-11   be in writing and sent by certified mail.  (V.A.C.S. Art. 717t,
220-12   Sec. 12(b) (part).)
220-13         Sec. 1402.143.  DEDUCTION FROM FOUNDATION SCHOOL FUND
220-14   PAYMENTS.  (a)  Except as provided by Section 1402.144, if a school
220-15   district fails to make a timely payment of principal and interest
220-16   due on a loan made to the district under this chapter, the agency
220-17   shall:
220-18               (1)  deduct the total amount due the board or the fund,
220-19   including interest and any applicable late payment charge as of the
220-20   date of notification, from the foundation school fund payment next
220-21   due the district, including any allocation to the district under
220-22   Chapter 42, Education Code; and
220-23               (2)  continue making the deductions from subsequent
220-24   foundation school fund payments until the total amount then due has
220-25   been deducted.
220-26         (b)  The agency shall credit the full amount of a foundation
220-27   school fund entitlement to a school district before making the
 221-1   deduction.  The amount of the deduction shall then be paid to the
 221-2   credit of the school facilities aid fund or to an account in that
 221-3   fund as the board may direct, on behalf of the district.
 221-4         (c)  If the board determines that all or any part of a
 221-5   deduction was deposited to the credit of the fund in error, the
 221-6   board may authorize payment from the fund of that amount directly
 221-7   to the district against which the deduction was made. (V.A.C.S.
 221-8   Art. 717t, Sec. 12(b) (part).)
 221-9         Sec. 1402.144.  DELINQUENCY ON GUARANTEED BOND; TRANSFER FROM
221-10   PERMANENT SCHOOL FUND.  If a school district is delinquent in
221-11   making a payment on a bond guaranteed by the permanent school fund
221-12   under Subchapter C, Chapter 45, Education Code, the amount of the
221-13   delinquency shall be transferred immediately from the appropriate
221-14   account in the permanent school fund to the school facilities aid
221-15   fund.  (V.A.C.S. Art. 717t, Sec.  12(c).)
221-16               (Chapters 1403-1430 reserved for expansion)
221-17        SUBTITLE H. SPECIFIC AUTHORITY FOR MORE THAN ONE TYPE OF
221-18                  LOCAL GOVERNMENT TO ISSUE SECURITIES
221-19                    CHAPTER 1431.  ANTICIPATION NOTES
221-20   Sec. 1431.001.  DEFINITIONS
221-21   Sec. 1431.002.  AUTHORITY TO ISSUE ANTICIPATION NOTES 
221-22   Sec. 1431.003.  ADDITIONAL AUTHORITY OF COUNTIES AND
221-23                     CERTAIN MUNICIPALITIES
221-24   Sec. 1431.004.  USES OF ANTICIPATION NOTE PROCEEDS
221-25   Sec. 1431.005.  GENERAL LIMITATION
221-26   Sec. 1431.006.  LIMITATION ON NOTES TO PAY EXPENSES
221-27   Sec. 1431.007.  GENERAL SOURCES OF PAYMENT
 222-1   Sec. 1431.008.  AD VALOREM TAXES AS SOURCE OF PAYMENT
 222-2   Sec. 1431.009.  MATURITY
 222-3   Sec. 1431.010.  SALE OF NOTES
 222-4   Sec. 1431.011.  ATTORNEY GENERAL APPROVAL OF CERTAIN NOTES
 222-5   Sec. 1431.012.  RESTRICTION ON CERTAIN CONTRACTS PAYABLE
 222-6                     FROM PROCEEDS OF NOTES
 222-7   Sec. 1431.013.  CONFLICT WITH OTHER LAWS
 222-8                    CHAPTER 1431.  ANTICIPATION NOTES
 222-9         Sec. 1431.001.  DEFINITIONS.  In this chapter:
222-10               (1)  "Anticipation note" means a note issued under this
222-11   chapter.
222-12               (2)  "Governing body" means the commissioners court of
222-13   a county or the governing body of a municipality authorized to
222-14   issue anticipation notes on behalf of an issuer.
222-15               (3)  "Issuer" means a  county or municipality issuing
222-16   an anticipation note.  (V.A.C.S. Art. 717w, Secs.  1(3), (6), (7).)
222-17         Sec. 1431.002.  AUTHORITY TO ISSUE ANTICIPATION NOTES.  (a)
222-18   The commissioners court of a county by order, on the recommendation
222-19   of the county auditor or the county budget officer, as applicable,
222-20   may authorize the issuance of an anticipation note.
222-21         (b)  The governing body of a municipality by ordinance may
222-22   authorize the issuance of an anticipation note.  (V.A.C.S.
222-23   Art. 717w, Secs. 3 (part), 5.)
222-24         Sec. 1431.003.  ADDITIONAL AUTHORITY OF COUNTIES AND CERTAIN
222-25   MUNICIPALITIES.  (a)  This section applies only to an issuer that
222-26   is:
222-27               (1)  a county; or
 223-1               (2)  a municipality with a population of 80,000 or
 223-2   more.
 223-3         (b)  Notwithstanding anything in this chapter to the
 223-4   contrary, the governing body may exercise the authority granted to
 223-5   the governing body of an issuer with regard to issuance of
 223-6   obligations under Chapter 1371, except that the prohibition in that
 223-7   chapter on the repayment of an obligation with ad valorem taxes
 223-8   does not apply to an issuer exercising the authority granted by
 223-9   this section.  (V.A.C.S.  Art. 717w, Sec. 4.)
223-10         Sec. 1431.004.  USES OF ANTICIPATION NOTE PROCEEDS.  (a)  An
223-11   issuer may use the proceeds of an anticipation note to pay:
223-12               (1)  a contractual obligation incurred or to be
223-13   incurred for:
223-14                     (A)  the construction of a public work;
223-15                     (B)  the purchase of materials, supplies,
223-16   equipment, machinery, buildings, lands, and rights-of-way for the
223-17   issuer's authorized needs and purposes; or
223-18                     (C)  a professional service, including a service
223-19   by a tax appraisal engineer, engineer, architect, attorney,
223-20   mapmaker, auditor, financial advisor, or fiscal agent;
223-21               (2)  operating or current expenses; or
223-22               (3)  the issuer's cumulative cash flow deficit.
223-23         (b)  For the purposes of this section, the cumulative cash
223-24   flow deficit is the amount by which the sum of an issuer's
223-25   anticipated expenditures and cash reserve reasonably required to
223-26   pay unanticipated expenditures exceeds the amount of the issuer's
223-27   cash, marketable securities, and money in an account that may be
 224-1   used to pay an issuer's anticipated expenditures, other than:
 224-2               (1)  money in an account the use of which is subject to
 224-3   legislative or judicial action or that is subject to a legislative,
 224-4   judicial, or contractual requirement that the account be
 224-5   reimbursed; or
 224-6               (2)  the proceeds of an anticipation note.
 224-7         (c)  For the purposes of Subsection (b), an amount equal to
 224-8   one month's anticipated expenditures is presumed to be reasonably
 224-9   required as a cash reserve.  (V.A.C.S. Art. 717w, Secs. 1(1), (4),
224-10   (5), 3 (part).)
224-11         Sec. 1431.005.  GENERAL LIMITATION.  An issuer may not use
224-12   proceeds of an anticipation note to repay interfund or other
224-13   borrowing that occurred earlier than 24 months before the date of
224-14   the ordinance or order authorizing the issuance of the note.
224-15   (V.A.C.S. Art. 717w, Sec. 6(d).)
224-16         Sec. 1431.006.  LIMITATION ON NOTES TO PAY EXPENSES.
224-17   Anticipation notes issued under Section 1431.004(a)(2) may not, in
224-18   the fiscal year in which the attorney general approves the notes:
224-19               (1)  for a municipality, exceed 75 percent of the
224-20   revenue or taxes anticipated to be collected in that year; or
224-21               (2)  for a county, exceed 50 percent of the revenue or
224-22   taxes anticipated to be collected in that year.  (V.A.C.S.
224-23   Art. 717w, Sec.  6(g).)
224-24         Sec. 1431.007.  GENERAL SOURCES OF PAYMENT.  A governing body
224-25   may:
224-26               (1)  provide that anticipation notes be paid from and
224-27   secured by revenue, taxes, or the proceeds of bonds to be issued by
 225-1   the issuer; and
 225-2               (2)  pledge to the payment of anticipation notes
 225-3   revenue, taxes, or the proceeds of bonds to be issued by the
 225-4   issuer.  (V.A.C.S. Art. 717w, Secs. 9(a), (b) (part).)
 225-5         Sec. 1431.008.  AD VALOREM TAXES AS SOURCE OF PAYMENT.  (a)
 225-6   A governing body may not issue anticipation notes that are payable
 225-7   from bonds secured by an ad valorem tax unless the proposition
 225-8   authorizing the issuance of the bonds:
 225-9               (1)  is approved by a majority of the votes cast in an
225-10   election held by the issuer; and
225-11               (2)  states that anticipation notes may be issued.
225-12         (b)  A governing body that pledges to the payment of
225-13   anticipation notes an ad valorem tax to be imposed in a subsequent
225-14   fiscal year shall impose the tax in the ordinance or order that
225-15   authorizes the issuance of the notes.  (V.A.C.S. Art. 717w, Secs.
225-16   6(c), 9(b) (part).)
225-17         Sec. 1431.009.  MATURITY.  (a)  An anticipation note issued
225-18   for a purpose described by Section 1431.004(a)(1) must mature
225-19   before the seventh anniversary of the date that the attorney
225-20   general approves the note.
225-21         (b)  An anticipation note issued for a purpose described by
225-22   Section 1431.004(a)(2) or (3) must mature before the first
225-23   anniversary of the date that the attorney general approves the
225-24   note.  (V.A.C.S. Art. 717w, Secs. 6(e), (f).)
225-25         Sec. 1431.010.  SALE OF NOTES.  A governing body may sell an
225-26   anticipation note at public or private sale for cash.  (V.A.C.S.
225-27   Art. 717w, Sec. 8.)
 226-1         Sec. 1431.011.  ATTORNEY GENERAL APPROVAL OF CERTAIN NOTES.
 226-2   Chapter 1371 governs approval by the attorney general of
 226-3   anticipation notes issued under Section 1431.003.  (V.A.C.S.
 226-4   Art. 717w, Sec. 6(b).)
 226-5         Sec. 1431.012.  RESTRICTION ON CERTAIN CONTRACTS PAYABLE FROM
 226-6   PROCEEDS OF NOTES.  A county must comply with the competitive
 226-7   bidding requirements of Subchapter C, Chapter 271, Local Government
 226-8   Code, in connection with a contract to be paid from the proceeds of
 226-9   anticipation notes issued for a purpose described by Section
226-10   1431.004(a)(1)(A).  (V.A.C.S. Art. 717w, Sec. 6(h).)
226-11         Sec. 1431.013.  CONFLICT WITH OTHER LAWS.  If there is a
226-12   conflict between this chapter and another statute:
226-13               (1)  an issuer may act under either; and
226-14               (2)  the governing body is not required to specify the
226-15   law under which the action is taken.  (V.A.C.S. Art. 717w, Sec.
226-16   2.)
226-17        CHAPTER 1432.  BONDS FOR LOCAL GOVERNMENT SPORTS CENTERS
226-18   Sec. 1432.001.  APPLICABILITY OF CHAPTER
226-19   Sec. 1432.002.  DEFINITIONS
226-20   Sec. 1432.003.  AUTHORITY FOR SPORTS CENTERS
226-21   Sec. 1432.004.  AUTHORITY TO ISSUE REVENUE BONDS
226-22   Sec. 1432.005.  PLEDGE OF REVENUE
226-23   Sec. 1432.006.  ADDITIONAL SECURITY
226-24   Sec. 1432.007.  BONDS NOT PAYABLE FROM TAXES
226-25   Sec. 1432.008.  MATURITY
226-26   Sec. 1432.009.  ADDITIONAL BONDS
226-27   Sec. 1432.010.  SALE OF BONDS
 227-1   Sec. 1432.011.  REVIEW AND APPROVAL OF CONTRACTS RELATING
 227-2                     TO BONDS
 227-3   Sec. 1432.012.  CHARGES
 227-4   Sec. 1432.013.  REFUNDING BONDS
 227-5   Sec. 1432.014.  PUBLIC PURPOSE
 227-6   Sec. 1432.015.  CONFLICT WITH OTHER LAW
 227-7        CHAPTER 1432.  BONDS FOR LOCAL GOVERNMENT SPORTS CENTERS
 227-8         Sec. 1432.001.  APPLICABILITY OF CHAPTER.  (a)  This chapter
 227-9   applies only to a local government that has all or most of its
227-10   territory located in a county with a population of more than
227-11   650,000.
227-12         (b)  Two or more local governments may act jointly under this
227-13   chapter if:
227-14               (1)  each local government is individually authorized
227-15   to act under this chapter;
227-16               (2)  all or most of the territory of each local
227-17   government is located in the same county or in adjacent counties;
227-18   and
227-19               (3)  the local governments act jointly to perform each
227-20   official act.
227-21         (c)  Local governments acting jointly may perform any act
227-22   that a single local government may perform under this chapter.
227-23   (V.A.C.S. Art. 717o, Secs. 2, 3(b).)
227-24         Sec. 1432.002.  DEFINITIONS.  In this chapter:
227-25               (1)  "Bond authorization" means an ordinance of the
227-26   governing body of a municipality, a resolution of the board of
227-27   trustees of an independent school district, or an order of the
 228-1   commissioners court of a county that authorizes the issuance of
 228-2   bonds.
 228-3               (2)  "Local government" means a county, a municipality,
 228-4   or an independent school district.  (V.A.C.S. Art. 717o, Secs.
 228-5   1(1), (2), 5(a) (part), (b) (part), 7(a) (part).)
 228-6         Sec. 1432.003.  AUTHORITY FOR SPORTS CENTERS.  (a)  A local
 228-7   government may construct, acquire, lease, improve, enlarge, and
 228-8   operate one or more facilities used for sporting activities or
 228-9   events, including auxiliary facilities such as parking areas or
228-10   restaurants.
228-11         (b)  A local government may contract with any public or
228-12   private entity, including a coliseum advisory board or similar
228-13   body, to perform any function authorized under this chapter other
228-14   than an official governmental act that must be performed by the
228-15   governing body of a local government.  (V.A.C.S. Art. 717o, Secs.
228-16   1(3), 3(a), (c).)
228-17         Sec. 1432.004.  AUTHORITY TO ISSUE REVENUE BONDS.  The
228-18   governing body of a local government may issue revenue bonds for a
228-19   purpose authorized by Section 1432.003.  (V.A.C.S. Art. 717o, Sec.
228-20   4 (part).)
228-21         Sec. 1432.005.  PLEDGE OF REVENUE.  A local government may
228-22   pledge all or part of the revenue, income, or receipts from a
228-23   facility authorized by this chapter to the payment of bonds,
228-24   including principal, interest, and any other amounts required or
228-25   permitted in connection with the bonds.  (V.A.C.S. Art. 717o, Secs.
228-26   4 (part), 7(a) (part).)
228-27         Sec. 1432.006.  ADDITIONAL SECURITY.  (a)  Bonds issued under
 229-1   this chapter may be additionally secured by:
 229-2               (1)  an encumbrance on any real property relating to a
 229-3   facility authorized by this chapter owned or to be acquired by the
 229-4   local government;
 229-5               (2)  an encumbrance on any personal property
 229-6   appurtenant to that real property; or
 229-7               (3)  a pledge of any portion of any grant, donation,
 229-8   revenue, or income received or to be received from the United
 229-9   States or any other public or private source.
229-10         (b)  The governing body of the local government may authorize
229-11   the execution of a trust indenture, mortgage, deed of trust, or
229-12   other instrument as evidence of the encumbrance.  (V.A.C.S.
229-13   Art. 717o, Secs. 7(b), (c).)
229-14         Sec. 1432.007.  BONDS NOT PAYABLE FROM TAXES.  A holder of a
229-15   bond issued under this chapter is not entitled to demand payment of
229-16   the bond from money raised by taxation. (V.A.C.S. Art. 717o, Sec.
229-17   7(d).)
229-18         Sec. 1432.008.  MATURITY.  A bond issued under this chapter
229-19   must mature not later than 40 years after its date.  (V.A.C.S.
229-20   Art. 717o, Sec. 5(a) (part).)
229-21         Sec. 1432.009.  ADDITIONAL BONDS.  The bond authorization may
229-22   provide for the subsequent issuance of additional parity bonds or
229-23   subordinate lien bonds under terms specified in the authorization.
229-24   (V.A.C.S. Art. 717o, Sec. 5(a) (part).)
229-25         Sec. 1432.010.  SALE OF BONDS.  A local government may sell
229-26   bonds issued under this chapter in the manner and under the terms
229-27   provided by the bond authorization.  (V.A.C.S. Art. 717o, Sec. 5(b)
 230-1   (part).)
 230-2         Sec. 1432.011.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
 230-3   BONDS.  (a)  If bonds issued under this chapter state that they are
 230-4   secured by a pledge of revenue or rents from a contract, including
 230-5   a lease contract, a copy of the contract and the proceedings
 230-6   related to it must be submitted to the attorney general.
 230-7         (b)  If the attorney general finds that the bonds have been
 230-8   authorized and the contract has been made in accordance with law,
 230-9   the attorney general shall approve the contract.
230-10         (c)  After the bonds are approved and registered as provided
230-11   by Chapter 1202 and the contract is approved under Subsection (b),
230-12   the contract is incontestable in a court or other forum for any
230-13   reason and is a valid and binding obligation for all purposes in
230-14   accordance with its terms.  (V.A.C.S. Art. 717o, Sec. 10 (part).)
230-15         Sec. 1432.012.  CHARGES.  (a)  The governing body of a local
230-16   government may impose and collect charges for the use or
230-17   availability of a facility authorized by this chapter.
230-18         (b)  A local government shall impose and collect pledged
230-19   charges in an amount that will be at least sufficient, with any
230-20   other pledged resources, to provide for the payment of:
230-21               (1)  the principal of, interest on, and any other
230-22   amounts required in connection with the bonds; and
230-23               (2)  to the extent required by the bond authorization:
230-24                     (A)  expenses incurred in connection with the
230-25   bonds; and
230-26                     (B)  operation, maintenance, and other expenses
230-27   incurred in connection with the facility.  (V.A.C.S. Art. 717o,
 231-1   Secs. 6, 7(a) (part).)
 231-2         Sec. 1432.013.  REFUNDING BONDS.  (a)  A local government may
 231-3   refund or otherwise refinance bonds issued under this chapter by
 231-4   issuing refunding bonds under any terms provided by a bond
 231-5   authorization.
 231-6         (b)  All appropriate provisions of this chapter apply to the
 231-7   refunding bonds.  The refunding bonds shall be issued in the manner
 231-8   provided by this chapter for other bonds.
 231-9         (c)  The refunding bonds may be sold and delivered in amounts
231-10   sufficient to pay the principal of and interest and any redemption
231-11   premium on the bonds to be refunded, at maturity or on any
231-12   redemption date.
231-13         (d)  The refunding bonds may be issued to be exchanged for
231-14   the bonds to be refunded by them.  In that case, the comptroller
231-15   shall register the refunding bonds and deliver them to the holder
231-16   of the bonds to be refunded as provided by the bond authorization.
231-17   The exchange may be made in one delivery or in installment
231-18   deliveries.  (V.A.C.S. Art. 717o, Secs. 9(a), (b).)
231-19         Sec. 1432.014.  PUBLIC PURPOSE.  The acquisition,
231-20   construction, improvement, enlargement, equipment, operation, and
231-21   maintenance of a facility authorized by this chapter is a public
231-22   purpose and a proper function of a local government.  (V.A.C.S.
231-23   Art. 717o, Sec. 8.)
231-24         Sec. 1432.015.  CONFLICT WITH OTHER LAW.  When bonds are
231-25   issued under this subchapter, to the extent of any conflict between
231-26   this chapter and another law, this chapter controls.  (V.A.C.S.
231-27   Art. 717o, Sec. 12 (part).)
 232-1     CHAPTER 1433.  BONDS FOR DEVELOPMENT OF EMPLOYMENT, INDUSTRIAL,
 232-2                          AND HEALTH RESOURCES
 232-3                    SUBCHAPTER A.  GENERAL PROVISIONS
 232-4   Sec. 1433.001.  SHORT TITLE
 232-5   Sec. 1433.002.  DEFINITIONS
 232-6   Sec. 1433.003.  APPLICABILITY OF CHAPTER TO MUNICIPALITIES
 232-7   Sec. 1433.004.  COST OF PROJECT
 232-8   Sec. 1433.005.  ULTIMATE LESSEE
 232-9   Sec. 1433.006.  CORRECTION OF INVALID PROCEDURES
232-10   Sec. 1433.007.  RELOCATION OR ALTERATION EXPENSE
232-11   Sec. 1433.008.  USE OF STATE MONEY
232-12           (Sections 1433.009-1433.020 reserved for expansion)
232-13                     SUBCHAPTER B.  POWERS OF ISSUER
232-14   Sec. 1433.021.  ACQUISITION OF PROJECT; DISPOSITION
232-15   Sec. 1433.022.  LIMITATIONS ON ACQUISITIONS
232-16   Sec. 1433.023.  AUTHORITY TO ISSUE REVENUE BONDS
232-17   Sec. 1433.024.  LEASE OF PROJECT
232-18   Sec. 1433.025.  ADVERTISING FOR CERTAIN CONTRACTS; PERFORMANCE
232-19                     AND PAYMENT BONDS
232-20   Sec. 1433.026.  PROHIBITED OPERATIONS
232-21           (Sections 1433.027-1433.040 reserved for expansion)
232-22               SUBCHAPTER C.  PROCEDURE FOR ISSUING BONDS
232-23   Sec. 1433.041.  DEPARTMENT APPROVAL OF LEASE; APPEAL
232-24   Sec. 1433.042.  REGULATION OF LEASES
232-25   Sec. 1433.043.  ISSUER'S AUTHORITY
232-26   Sec. 1433.044.  BOND RESOLUTION; CALLING ELECTION; PUBLICATION
232-27                     OF RESOLUTION
 233-1   Sec. 1433.045.  PROTEST
 233-2   Sec. 1433.046.  ELECTION ORDER
 233-3   Sec. 1433.047.  NOTICE OF ELECTION
 233-4   Sec. 1433.048.  BALLOT PROPOSITION; ELECTION PROCEDURES
 233-5   Sec. 1433.049.  RESULTS OF ELECTION
 233-6           (Sections 1433.050-1433.060 reserved for expansion)
 233-7                          SUBCHAPTER D.  BONDS
 233-8   Sec. 1433.061.  ISSUANCE OF BONDS
 233-9   Sec. 1433.062.  MONEY USED TO PAY BONDS; PROHIBITION ON CERTAIN
233-10                     OBLIGATIONS
233-11   Sec. 1433.063.  BONDS NOT DEBT OF STATE OR ISSUER
233-12   Sec. 1433.064.  MATURITY
233-13   Sec. 1433.065.  SALE OF BONDS
233-14   Sec. 1433.066.  INTERIM RECEIPTS; TEMPORARY BONDS
233-15   Sec. 1433.067.  USE OF BOND PROCEEDS
233-16   Sec. 1433.068.  REFUNDING BONDS
233-17   Sec. 1433.069.  EXEMPTIONS FROM TAXATION AND SECURITIES ACT
233-18           (Sections 1433.070-1433.100 reserved for expansion)
233-19               SUBCHAPTER E.  AGREEMENTS RELATING TO BONDS
233-20   Sec. 1433.101.  SECURITY FOR BOND; TRUST AGREEMENT
233-21   Sec. 1433.102.  DEFAULT IN LEASE AGREEMENT OR MORTGAGE;
233-22                     ENFORCEMENT
233-23   Sec. 1433.103.  PURCHASE OPTION
233-24     CHAPTER 1433.  BONDS FOR DEVELOPMENT OF EMPLOYMENT, INDUSTRIAL,
233-25                          AND HEALTH RESOURCES
233-26                    SUBCHAPTER A.  GENERAL PROVISIONS
233-27         Sec. 1433.001.  SHORT TITLE.  This chapter may be cited as
 234-1   the Act for Development of Employment, Industrial, and Health
 234-2   Resources.  (V.A.C.S. Art. 5190.1, Sec. 1.)
 234-3         Sec. 1433.002.  DEFINITIONS.  In this chapter:
 234-4               (1)  "Department" means the Texas Department of
 234-5   Economic Development.
 234-6               (2)  "District" means a conservation and reclamation
 234-7   district established under Section 59, Article XVI, or Section 52,
 234-8   Article III, Texas Constitution.
 234-9               (3)  "Governing body" means the commissioners court of
234-10   a county or the governing body of a municipality or district.
234-11               (4)  "Industrial project" means the land, buildings,
234-12   equipment, facilities, and improvements found by the governing body
234-13   to be required or suitable for the promotion of industrial
234-14   development and for use by manufacturing or industrial enterprise,
234-15   regardless of whether the land, buildings, equipment, facilities,
234-16   and improvements are in existence when or are to be acquired or
234-17   constructed after the finding is made.
234-18               (5)  "Issuer" means a municipality, county, or
234-19   district.
234-20               (6)  "Medical project" means the land, buildings,
234-21   equipment, facilities, and improvements found by the governing body
234-22   to be required for public health, research, and medical facilities
234-23   located in this state, regardless of whether the land, buildings,
234-24   equipment, facilities, and improvements are in existence when or
234-25   are to be acquired or constructed after the finding is made.
234-26   (V.A.C.S. Art. 5190.1, Secs. 2(b), (e), (f), (g), (i), (j).)
234-27         Sec. 1433.003.  APPLICABILITY OF CHAPTER TO MUNICIPALITIES.
 235-1   This chapter applies to a municipality only if the municipality:
 235-2               (1)  has the power to impose an ad valorem tax of not
 235-3   less than $1.50 on each $100 valuation of taxable property in the
 235-4   municipality; or
 235-5               (2)  is a home-rule municipality.  (V.A.C.S.
 235-6   Art. 5190.1, Sec. 2(a).)
 235-7         Sec. 1433.004.  COST OF PROJECT.  For purposes of this
 235-8   chapter, the cost of an industrial project or medical project is:
 235-9               (1)  the cost of acquisitions for the project,
235-10   including the cost of the acquisition of all land, rights-of-way,
235-11   property rights, easements, and interests acquired for the
235-12   construction;
235-13               (2)  the cost of all machinery and equipment;
235-14               (3)  financing charges;
235-15               (4)  interest accruing before and during construction
235-16   and until the first anniversary of the date on which the
235-17   construction is completed;
235-18               (5)  the cost of estimates, including estimates of
235-19   revenue, engineering and legal services, plans, specifications,
235-20   surveys, and other expenses necessary or incident to determining
235-21   the feasibility and practicability of constructing the project;
235-22               (6)  administrative expenses; and
235-23               (7)  other expenses that are necessary or incident to
235-24   the acquisition of the project, the financing of the acquisition,
235-25   and the placing of the project in operation.  (V.A.C.S.
235-26   Art. 5190.1, Sec. 2(c).)
235-27         Sec. 1433.005.  ULTIMATE LESSEE.  For purposes of this
 236-1   chapter, an ultimate lessee is the person, firm, corporation, or
 236-2   company that leases an industrial project or medical project from
 236-3   the lessee of the project.  (V.A.C.S. Art. 5190.1, Sec. 2(k).)
 236-4         Sec. 1433.006.  CORRECTION OF INVALID PROCEDURES.  If a court
 236-5   holds that any procedure under this chapter violates the
 236-6   constitution of this state or the United States, the issuer by
 236-7   resolution may provide an alternative procedure that conforms with
 236-8   the constitution.  (V.A.C.S. Art. 5190.1, Sec. 19 (part).)
 236-9         Sec. 1433.007.  RELOCATION OR ALTERATION EXPENSE.  If a
236-10   municipality, county, district, or other political subdivision, in
236-11   the exercise of a power under this chapter, including the power of
236-12   relocation, makes necessary the relocation or rerouting of, or
236-13   alteration of the construction of, a highway, railroad, electric
236-14   transmission line, telegraph or telephone property or facility, or
236-15   pipeline, the relocation or rerouting or alteration of construction
236-16   must be accomplished at the sole expense of the political
236-17   subdivision.  In this section, "sole expense" means the actual cost
236-18   of the relocation or rerouting or alteration of construction to
236-19   provide comparable replacement without enhancement of the facility,
236-20   after deduction of the net salvage value derived from the old
236-21   facility.  (V.A.C.S. Art. 5190.1, Sec. 16.)
236-22         Sec. 1433.008.  USE OF STATE MONEY.  (a)  The legislature may
236-23   not appropriate money to pay all or a part of the obligation of an
236-24   issuer under this chapter.
236-25         (b)  The department shall pay any expense it incurs under
236-26   this chapter from money appropriated to the department.  (V.A.C.S.
236-27   Art. 5190.1, Sec. 18 (part).)
 237-1           (Sections 1433.009-1433.020 reserved for expansion)
 237-2                     SUBCHAPTER B.  POWERS OF ISSUER
 237-3         Sec. 1433.021.  ACQUISITION OF PROJECT; DISPOSITION.  (a)  An
 237-4   issuer may acquire, by construction, purchase, devise, gift, or
 237-5   lease or by more than one of those methods, an industrial project
 237-6   or medical project that is located in this state and at least a
 237-7   part of which is located within the issuer's territorial limits.
 237-8         (b)  For an issuer that is a municipality, an industrial
 237-9   project or medical project may be located outside the
237-10   municipality's territorial limits if the project is within the
237-11   municipality's extraterritorial jurisdiction as determined under
237-12   Subchapter B, Chapter 42, Local Government Code.
237-13         (c)  An issuer may sell and convey all or any part of
237-14   property acquired under this section and make an order relating to
237-15   the sale or conveyance that the issuer considers conducive to the
237-16   best interest of the issuer.  (V.A.C.S. Art. 5190.1, Sec. 4(a)
237-17   (part).)
237-18         Sec. 1433.022.  LIMITATIONS ON ACQUISITIONS.  (a)  An issuer
237-19   may not acquire an industrial project, or any part of an industrial
237-20   project, by eminent domain.
237-21         (b)  Land previously acquired by an issuer by eminent domain
237-22   may be sold, leased, or otherwise used in accordance with this
237-23   chapter, if the governing body determines that:
237-24               (1)  the use will not interfere with the purpose for
237-25   which that land was originally acquired or that the land is no
237-26   longer needed for that purpose;
237-27               (2)  at least seven years have elapsed since the land
 238-1   was acquired by eminent domain; and
 238-2               (3)  the land was not acquired for park purposes unless
 238-3   the sale or lease of that land has been approved at an election
 238-4   held under Section 1502.057.
 238-5         (c)  An issuer may not acquire or construct an industrial
 238-6   project or medical project for an individual, firm, partnership, or
 238-7   corporation, or make or authorize a lease to an individual, firm,
 238-8   partnership, or corporation if the effect of the lease of that
 238-9   project is to remove the lessee's business from existing facilities
238-10   in this state.
238-11         (d)  An issuer may not issue bonds to acquire existing
238-12   facilities for the purpose of leasing those facilities to the
238-13   industrial concern from which the facilities are acquired or to
238-14   another person controlled by the industrial concern.  (V.A.C.S.
238-15   Art. 5190.1, Secs.  4(a) (part), 11, 13 (part).)
238-16         Sec. 1433.023.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)
238-17   Except as provided by Subsection (b), an issuer may issue revenue
238-18   bonds to pay all or a part of the cost of acquiring, constructing,
238-19   enlarging, or improving an industrial project, including a project
238-20   in an enterprise zone designated under Chapter 2303, or a medical
238-21   project.
238-22         (b)  A district may not authorize revenue bonds for a medical
238-23   project.
238-24         (c)  An issuer may secure the payment of the bonds as
238-25   provided by this chapter.  (V.A.C.S. Art. 5190.1, Secs. 4(a)
238-26   (part), 7 (part).)
238-27         Sec. 1433.024.  LEASE OF PROJECT.  (a)  An issuer may, in
 239-1   accordance with this chapter, lease any or all of the issuer's
 239-2   industrial projects and medical projects.
 239-3         (b)  An issuer may lease property under this chapter only to
 239-4   a corporation organized under the Texas  Non-Profit Corporation Act
 239-5   (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
 239-6   (V.A.C.S. Art. 5190.1, Secs. 2(h),  4(a) (part).)
 239-7         Sec. 1433.025.  ADVERTISING FOR CERTAIN CONTRACTS;
 239-8   PERFORMANCE AND PAYMENT BONDS.  (a)  A contract for construction or
 239-9   purchase under this chapter involving the expenditure of more than
239-10   $2,000 may be made only after advertising in the manner provided by
239-11   Chapter 252, Local Government Code, or Subchapter C, Chapter 262,
239-12   Local Government Code, as applicable.
239-13         (b)  The  provisions of Chapter 2253 relating to performance
239-14   and payment bonds apply to construction contracts let by the
239-15   issuer.  (V.A.C.S. Art. 5190.1, Sec. 13 (part).)
239-16         Sec. 1433.026.  PROHIBITED OPERATIONS.  An issuer may not
239-17   operate an industrial project as a business or in any manner other
239-18   than as the lessor of the project.  (V.A.C.S. Art. 5190.1, Sec.
239-19   4(a) (part).)
239-20           (Sections 1433.027-1433.040 reserved for expansion)
239-21               SUBCHAPTER C.  PROCEDURE FOR ISSUING BONDS
239-22         Sec. 1433.041.  DEPARTMENT APPROVAL OF LEASE; APPEAL.  (a)
239-23   An issuer may not begin proceedings to authorize bonds under
239-24   Section 1433.044 or 1433.061 until the department has given
239-25   tentative approval to the suggested contents of the lease
239-26   agreement, and if a lessee is allowed to sublease, the department
239-27   has tentatively approved the financial responsibility of the
 240-1   ultimate lessee.  The department shall investigate a proposed
 240-2   acquisition of existing facilities for compliance with Section
 240-3   1433.022(d) before tentatively approving an industrial project or
 240-4   medical project.
 240-5         (b)  The department may not give final approval to any
 240-6   agreement unless the department affirmatively finds that the lessee
 240-7   and ultimate lessee have the business experience, financial
 240-8   resources, and responsibility to provide reasonable assurance that
 240-9   all bonds and interest on the bonds to be paid from or because of
240-10   that agreement will be paid as they become due.
240-11         (c)  The attorney general may not approve bonds to be issued
240-12   under this chapter until the department has given final approval to
240-13   the lease agreement and may not approve the bonds if the provisions
240-14   for security and payment of lease payments do not conform with this
240-15   chapter.
240-16         (d)  An issuer may appeal any adverse ruling or decision of
240-17   the department under this section to a district court in Travis
240-18   County.  The substantial evidence rule applies to an appeal under
240-19   this subsection.  (V.A.C.S. Art. 5190.1, Secs. 5 (part), 12 (part),
240-20   13 (part).)
240-21         Sec. 1433.042.  REGULATION OF LEASES.  The department by rule
240-22   shall adopt minimum standards for lease agreements and guidelines
240-23   relating to financial responsibilities of the lessee and any
240-24   ultimate lessee.  (V.A.C.S. Art. 5190.1, Sec. 5 (part).)
240-25         Sec. 1433.043.  ISSUER'S AUTHORITY.  (a)  An issuer may issue
240-26   bonds under this chapter without obtaining the consent of any
240-27   department, division, commission, board, bureau, or agency of the
 241-1   state, other than the attorney general under Chapter 1202 or the
 241-2   department, and without any proceedings or satisfying any condition
 241-3   precedent other than the proceedings and conditions required by:
 241-4               (1)  this chapter;
 241-5               (2)  Subchapter B or D, Chapter 1201; or
 241-6               (3)  Chapter 1204.
 241-7         (b)  Except as provided by this chapter or by department
 241-8   rule, each governing body has complete authority with respect to
 241-9   bonds and lease agreements governed by this chapter.  (V.A.C.S.
241-10   Art. 5190.1, Secs. 7 (part), 12 (part).)
241-11         Sec. 1433.044.  BOND RESOLUTION; CALLING ELECTION;
241-12   PUBLICATION OF RESOLUTION.  (a)  Before issuing bonds under this
241-13   chapter, a governing body shall adopt a resolution declaring its
241-14   intention to issue the bonds.
241-15         (b)  The resolution must specify:
241-16               (1)  the amount of bonds proposed to be issued;
241-17               (2)  the purpose for which the bonds are to be issued;
241-18   and
241-19               (3)  the date on which the governing body proposes to
241-20   authorize the issuance of the bonds.
241-21         (c)  The governing body may call an election on the issuance
241-22   of the bonds.
241-23         (d)  If an election is not called under Subsection (c), the
241-24   governing body shall publish the resolution once a week for at
241-25   least two consecutive weeks in at least one newspaper of general
241-26   circulation in the territorial limits of the issuer.  The first
241-27   publication must be not later than the 15th day preceding the date
 242-1   specified in the resolution for the authorization of the bonds.
 242-2   (V.A.C.S. Art. 5190.1, Sec. 6(a) (part).)
 242-3         Sec. 1433.045.  PROTEST.  (a)  If at least 10 percent of the
 242-4   registered voters of the issuer file a written protest against the
 242-5   issuance of the bonds on or before the date specified for the
 242-6   authorization of the bonds, the governing body shall hold an
 242-7   election on the issuance of the bonds.
 242-8         (b)  If a written protest is not filed, the bonds may be
 242-9   issued without an election at any time before the second
242-10   anniversary of the date specified in the resolution.  (V.A.C.S.
242-11   Art. 5190.1, Sec. 6(a) (part).)
242-12         Sec. 1433.046.  ELECTION ORDER.  In addition to the
242-13   requirements provided by Chapter 3, Election Code, an order calling
242-14   an election under this subchapter must include the location of each
242-15   polling place and the election judges and clerks appointed for each
242-16   polling place.  (V.A.C.S. Art. 5190.1, Sec. 6(b) (part).)
242-17         Sec. 1433.047.  NOTICE OF ELECTION.  Notice of an election
242-18   under this subchapter shall be published once a week for at least
242-19   two consecutive weeks, in at least one newspaper of general
242-20   circulation within the territorial limits of the issuer.  The first
242-21   publication must be not later than the 15th day before the date of
242-22   the election.  (V.A.C.S. Art. 5190.1, Sec. 6(b) (part).)
242-23         Sec. 1433.048.  BALLOT PROPOSITION; ELECTION PROCEDURES.  (a)
242-24   The ballot for an election held under this subchapter shall be
242-25   printed to permit voting for or against the proposition:  "The
242-26   issuance of revenue bonds for the (medical project or industrial
242-27   project)."
 243-1         (b)  The election shall be conducted in accordance with the
 243-2   general laws of this state relating to general elections, except as
 243-3   modified by this chapter.  (V.A.C.S. Art. 5190.1, Sec. 6(b)
 243-4   (part).)
 243-5         Sec. 1433.049.  RESULTS OF ELECTION.  (a)  Not later than the
 243-6   10th day after the date on which an election is held, or as soon
 243-7   after that day as possible, the governing body of the issuer shall
 243-8   convene and canvass the returns of the election.
 243-9         (b)  If a majority of the voters voting in a bond election
243-10   vote in favor of the proposition, the governing body shall find and
243-11   declare that the results favor the proposition, and subject to
243-12   Section 1433.041, the governing body may proceed with the
243-13   authorization of the bonds.  (V.A.C.S. Art. 5190.1, Sec.  6(b)
243-14   (part).)
243-15           (Sections 1433.050-1433.060 reserved for expansion)
243-16                          SUBCHAPTER D.  BONDS
243-17         Sec. 1433.061.  ISSUANCE OF BONDS.  (a)  A series of bonds
243-18   may be issued for each industrial project or medical project.  Any
243-19   projects may be combined in a single series of bonds if the
243-20   governing body considers the combination to be in the best interest
243-21   of the issuer, but each project shall be considered separately with
243-22   respect to this subsection and Subchapter C.
243-23         (b)  Bonds must be issued and delivered before the third
243-24   anniversary of the later of the date of the tentative approval of
243-25   the department or the date of the final judgment of any litigation
243-26   affecting the validity of the bonds or the provision made for their
243-27   payment.  This subsection does not prohibit the department from
 244-1   conditioning its approval of an industrial project or medical
 244-2   project on the completion of the financing of the project within a
 244-3   shorter period.  (V.A.C.S. Art. 5190.1, Secs. 6(c), (d).)
 244-4         Sec. 1433.062.  MONEY USED TO PAY BONDS; PROHIBITION ON
 244-5   CERTAIN OBLIGATIONS.  (a)  The principal of and the interest on
 244-6   bonds authorized under this chapter are payable only from the money
 244-7   provided for that payment and from the revenue of the industrial
 244-8   project or medical project for which the bonds were authorized.
 244-9         (b)  An issuer may not incur financial obligations that
244-10   cannot be paid from revenue from the lease of an industrial project
244-11   or medical project.  (V.A.C.S. Art. 5190.1, Secs. 3 (part), 7
244-12   (part).)
244-13         Sec. 1433.063.  BONDS NOT DEBT OF STATE OR ISSUER.  (a)  A
244-14   bond issued under this chapter is not a debt or a pledge of the
244-15   faith and credit of this state, the issuer, or any other political
244-16   subdivision or agency of this state.
244-17         (b)  A bond issued under this chapter must contain on its
244-18   face a statement that:
244-19               (1)  this state, the issuer, or any other political
244-20   subdivision or agency of this state is not obligated to pay the
244-21   principal of or the interest on the bond except from revenue of the
244-22   industrial project or medical project for which the bond is issued;
244-23   and
244-24               (2)  the faith and credit and the taxing power of this
244-25   state, the issuer, or any other political subdivision or agency of
244-26   this state are not pledged to the payment of the principal of or
244-27   the interest on the bond.
 245-1         (c)  Each bond issued under this chapter must contain
 245-2   substantially the following language:  "No pecuniary obligation is
 245-3   or may be imposed on the issuer of this bond in the event of a
 245-4   failure to pay all or part of the principal or interest on the
 245-5   bond, except that the issuer is obligated to apply rental income it
 245-6   receives from the (industrial project or medical project) to those
 245-7   purposes."  (V.A.C.S. Art. 5190.1, Secs. 3 (part), 10 (part).)
 245-8         Sec. 1433.064.  MATURITY.  A bond issued under this chapter
 245-9   must mature not later than 40 years after its date.  (V.A.C.S.
245-10   Art. 5190.1, Sec. 7 (part).)
245-11         Sec. 1433.065.  SALE OF BONDS.  Bonds issued under this
245-12   chapter shall be sold to the highest bidder for cash and may not be
245-13   exchanged for property.  (V.A.C.S. Art. 5190.1, Sec.  7 (part).)
245-14         Sec. 1433.066.  INTERIM RECEIPTS; TEMPORARY BONDS.  Before
245-15   the preparation of definitive bonds, an issuer may, under the
245-16   restrictions applicable to the definitive bonds, issue interim
245-17   receipts or temporary bonds, with or without coupons, exchangeable
245-18   for definitive bonds when the definitive bonds are executed and
245-19   available for delivery.  (V.A.C.S. Art. 5190.1, Sec. 7 (part).)
245-20         Sec. 1433.067.  USE OF BOND PROCEEDS.  The proceeds of the
245-21   bonds of each issue may be used only for the payment of the cost of
245-22   the industrial project or medical project for which the bonds were
245-23   issued, and shall be disbursed in the manner and under any
245-24   restrictions provided in the resolution authorizing the issuance of
245-25   the bonds or in the trust agreement securing the bonds.  Any
245-26   proceeds of the bonds of an issue that exceed the cost of the
245-27   project for which the bonds were issued shall be deposited to the
 246-1   credit of the sinking fund for those bonds.  (V.A.C.S. Art. 5190.1,
 246-2   Sec.  7 (part).)
 246-3         Sec. 1433.068.  REFUNDING BONDS.  (a)  An issuer by
 246-4   resolution may provide for the issuance of revenue refunding bonds
 246-5   to:
 246-6               (1)  refund any outstanding bonds issued under this
 246-7   chapter; and
 246-8               (2)  construct improvements, extensions, or
 246-9   enlargements to the industrial project or medical project in
246-10   connection with which the bonds being refunded were issued.
246-11         (b)  An issuer may issue revenue refunding bonds in exchange
246-12   for outstanding bonds, notwithstanding Section 1433.065, or the
246-13   issuer may use the proceeds from the sale of the revenue refunding
246-14   bonds to redeem outstanding bonds.  (V.A.C.S. Art. 5190.1, Sec. 8
246-15   (part).)
246-16         Sec. 1433.069.  EXEMPTIONS FROM TAXATION AND SECURITIES ACT.
246-17   (a)  A bond issued under this chapter and the issuance and transfer
246-18   of the bond, including any profit made in the sale of the bond, are
246-19   exempt from taxation by this state or by a political subdivision of
246-20   this state.
246-21         (b)  A bond issued under this chapter and any coupon
246-22   representing interest on the bond are exempt securities under The
246-23   Securities Act (Article 581-1 et seq., Vernon's Texas Civil
246-24   Statutes).
246-25         (c)  A lease agreement under this chapter is not a security
246-26   under The Securities Act (Article 581-1 et seq., Vernon's Texas
246-27   Civil Statutes).  (V.A.C.S. Art. 5190.1, Sec. 14 (part).)
 247-1           (Sections 1433.070-1433.100 reserved for expansion)
 247-2               SUBCHAPTER E.  AGREEMENTS RELATING TO BONDS
 247-3         Sec. 1433.101.  SECURITY FOR BOND; TRUST AGREEMENT.  (a)  A
 247-4   bond issued under this chapter may be secured by a trust agreement
 247-5   between the issuer and a trust company or a bank having the powers
 247-6   of a trust company in this state.
 247-7         (b)  A trust agreement may:
 247-8               (1)  assign the lease revenue to be received from the
 247-9   lessee or the ultimate lessee of the industrial project or medical
247-10   project for which the bond proceeds are used; or
247-11               (2)  pledge the lease revenue for the payment of
247-12   principal of and interest on the bond as they become due and
247-13   payable and may provide for the creation and maintenance of
247-14   reserves for that purpose.
247-15         (c)  A trust agreement or a resolution providing for the
247-16   issuance of the bonds may contain provisions for protecting and
247-17   enforcing the rights and remedies of the bondholders, including
247-18   covenants that state the duties of the issuer or lessee relating
247-19   to:
247-20               (1)  the acquisition of property for the industrial
247-21   project or medical project in connection with which the bonds were
247-22   authorized;
247-23               (2)  the construction, improvement, maintenance,
247-24   repair, operation, and insurance of the project; and
247-25               (3)  the custody, protection, and application of all
247-26   money related to the project.
247-27         (d)  An issuer may require a bank or trust company
 248-1   incorporated under the laws of this state that acts as depository
 248-2   of the proceeds of the bonds or of revenue of the issuer to furnish
 248-3   indemnifying bonds or to pledge securities.
 248-4         (e)  A trust agreement may state the rights and remedies of
 248-5   the bondholders and of the trustee, and may restrict the individual
 248-6   right of action by bondholders as is customary in trust agreements
 248-7   or trust indentures securing bonds and debentures of corporations.
 248-8   A trust agreement may contain additional provisions for the
 248-9   security of the bondholders.
248-10         (f)  All expenses incurred in carrying out a trust agreement
248-11   may be treated as a part of the cost of the operation of the
248-12   industrial project or medical project.  (V.A.C.S. Art. 5190.1, Sec.
248-13   9.)
248-14         Sec. 1433.102.  DEFAULT IN LEASE AGREEMENT OR MORTGAGE;
248-15   ENFORCEMENT.  (a)  An agreement relating to an industrial project
248-16   or medical project between the issuer and the lessee or between a
248-17   lessee and ultimate lessee must be for the benefit of the issuer.
248-18   The agreement must provide that, in the event of a default in the
248-19   payment of the principal of or the interest on the bonds or in the
248-20   performance of any agreement contained in a proceeding, mortgage,
248-21   or instrument, the payment or performance may be enforced by
248-22   mandamus or by the appointment of a receiver with the power to
248-23   charge rents and to apply the revenue from the project in
248-24   accordance with the resolution, mortgage, or instrument.
248-25         (b)  A mortgage to secure bonds issued under this chapter may
248-26   also provide that, in the event of a default in the payment of the
248-27   mortgage or a violation of an agreement contained in the mortgage,
 249-1   the mortgage may be foreclosed and the property securing the bonds
 249-2   may be sold in any manner permitted by law.  The mortgage may
 249-3   provide that a trustee under the mortgage or the holder of any of
 249-4   the bonds secured by the mortgage may purchase the property at a
 249-5   foreclosure sale if the person is the highest bidder.  (V.A.C.S.
 249-6   Art. 5190.1, Sec. 10 (part).)
 249-7         Sec. 1433.103.  PURCHASE OPTION.  (a)  An issuer may grant a
 249-8   lessee or ultimate lessee an option to purchase all or a part of an
 249-9   industrial project or medical project when all bonds of the issuer
249-10   delivered to provide those facilities have been paid or provision
249-11   has been made for their final payment, if, while the bonds or
249-12   interest on the bonds remains unpaid, the lease rentals are paid in
249-13   the manner required and when the rentals become due.
249-14         (b)  For purposes of this section, a payment is considered to
249-15   be paid in the manner required and when it becomes due if no event
249-16   of default is declared and the payment is made not later than the
249-17   15th day after the date it is scheduled to become due.
249-18         (c)  This section is the exclusive authority to convey or
249-19   grant an option to purchase an industrial project or medical
249-20   project.  (V.A.C.S. Art. 5190.1, Sec. 10 (part).)
249-21          CHAPTER 1434.  COUNTY AND MUNICIPAL HIGHER EDUCATION
249-22                            IMPROVEMENT BONDS
249-23                    SUBCHAPTER A.  GENERAL PROVISIONS
249-24   Sec. 1434.001.  APPLICABILITY OF CHAPTER
249-25   Sec. 1434.002.  DEFINITIONS
249-26   Sec. 1434.003.  LEGISLATIVE FINDING
249-27           (Sections 1434.004-1434.050 reserved for expansion)
 250-1                    SUBCHAPTER B.  ISSUANCE OF BONDS
 250-2   Sec. 1434.051.  FINANCING OF PERMANENT IMPROVEMENTS BY
 250-3                     COUNTY OR MUNICIPALITY
 250-4   Sec. 1434.052.  JOINT FINANCING BY COUNTY AND MUNICIPALITY
 250-5   Sec. 1434.053.  LIMIT ON TAXES
 250-6   Sec. 1434.054.  PROJECT APPROVAL BY TEXAS HIGHER EDUCATION
 250-7                     COORDINATING BOARD
 250-8           (Sections 1434.055-1434.100 reserved for expansion)
 250-9        SUBCHAPTER C.  DONATION OR USE OF PERMANENT IMPROVEMENTS
250-10   Sec. 1434.101.  DONATION OF PERMANENT IMPROVEMENTS
250-11   Sec. 1434.102.  USE OF PERMANENT IMPROVEMENTS
250-12          CHAPTER 1434.  COUNTY AND MUNICIPAL HIGHER EDUCATION
250-13                            IMPROVEMENT BONDS
250-14                    SUBCHAPTER A.  GENERAL PROVISIONS
250-15         Sec. 1434.001.  APPLICABILITY OF CHAPTER.  This chapter
250-16   applies only to:
250-17               (1)  a home-rule municipality with a population of
250-18   25,000 or more that has a general academic teaching institution
250-19   located within its boundaries; or
250-20               (2)  a county within which a municipality described by
250-21   Subdivision (1) is located.  (V.A.C.S. Art. 1182n, Secs. 1(3),
250-22   (4).)
250-23         Sec. 1434.002.  DEFINITIONS.  In this chapter:
250-24               (1)  "Institution of higher education" means:
250-25                     (A)  an institution of higher education as
250-26   defined by Section 61.003, Education Code; or
250-27                     (B)  a private, nonprofit institution of higher
 251-1   education that is accredited by the recognized accrediting agency
 251-2   and is located and authorized to operate in this state, other than
 251-3   a private institution of higher education operated exclusively for
 251-4   sectarian purposes.
 251-5               (2)  "Public security" has the meaning assigned by
 251-6   Section 1201.002.
 251-7               (3)  "Recognized accrediting agency" has the meaning
 251-8   assigned by Section 61.003, Education Code.  (V.A.C.S. Art. 1182n,
 251-9   Secs. 1(2), (5).)
251-10         Sec. 1434.003.  LEGISLATIVE FINDING.  The legislature  finds
251-11   that the assistance provided by counties and municipalities in
251-12   promoting and providing higher education opportunities for
251-13   residents of this state will encourage the development and
251-14   diversification of the economy of this state and the elimination of
251-15   unemployment and underemployment in this state.  (V.A.C.S.
251-16   Art. 1182n, Sec. 2 (part).)
251-17           (Sections 1434.004-1434.050 reserved for expansion)
251-18                    SUBCHAPTER B.  ISSUANCE OF BONDS
251-19         Sec. 1434.051.  FINANCING OF PERMANENT IMPROVEMENTS BY COUNTY
251-20   OR MUNICIPALITY.  (a)  A county or a municipality may:
251-21               (1)  issue public securities, including certificates of
251-22   obligation, to acquire, construct, or improve land, buildings, or
251-23   other permanent improvements for use by an institution of higher
251-24   education located within a county to which this chapter applies;
251-25   and
251-26               (2)  impose ad valorem taxes to pay the principal of
251-27   and interest on those securities and to provide a sinking fund.
 252-1         (b)  The county or municipality shall:
 252-2               (1)  issue any public securities and impose the taxes
 252-3   in accordance with the applicable provisions of Subtitles A, C, D,
 252-4   and E; and
 252-5               (2)  if the securities are certificates of obligation,
 252-6   issue any certificates and impose the taxes in accordance with
 252-7   Subchapter C, Chapter 271, Local Government Code.  (V.A.C.S.
 252-8   Art. 1182n, Secs. 3(a), (b).)
 252-9         Sec. 1434.052.  JOINT FINANCING BY COUNTY AND MUNICIPALITY.
252-10   (a)  A county and a municipality may jointly issue public
252-11   securities and impose ad valorem taxes for a purpose described by
252-12   Section 1434.051.
252-13         (b)  The commissioners court of the county and the governing
252-14   body of the  municipality shall determine the appropriate
252-15   proportion of the ad valorem taxes to be imposed by the county and
252-16   by the municipality.
252-17         (c)  A public security proposition that is submitted must
252-18   distinctly specify the proportion of ad valorem taxes to be imposed
252-19   by the county and by the municipality.
252-20         (d)  The county and municipality shall issue the public
252-21   securities and impose the taxes in accordance with the applicable
252-22   provisions of Subtitles A, C, D, and E.  (V.A.C.S. Art. 1182n,
252-23   Secs. 4(a), (b), (c), (d).)
252-24         Sec. 1434.053.  LIMIT ON TAXES.  The only limits on the
252-25   amount of taxes that may be imposed to pay the principal of and
252-26   interest on public securities, including certificates of
252-27   obligation, issued under this chapter are those provided by the
 253-1   Texas Constitution.  (V.A.C.S. Art. 1182n, Secs.  3(c), 4(e).)
 253-2         Sec. 1434.054.  PROJECT APPROVAL BY TEXAS HIGHER EDUCATION
 253-3   COORDINATING BOARD.  (a)  Before public securities are issued under
 253-4   this chapter, the Texas Higher Education Coordinating Board or its
 253-5   successor agency must review the project to be acquired,
 253-6   constructed, or improved.  The board or its successor agency shall
 253-7   conduct hearings to review the project in accordance with Chapter
 253-8   61, Education Code.
 253-9         (b)  Public securities may not be issued under this chapter
253-10   unless the board or its successor agency approves the acquisition,
253-11   construction, or improvement of the project to be financed through
253-12   the issuance of the public securities.  (V.A.C.S. Art. 1182n,
253-13   Secs. 1(1), 5.)
253-14           (Sections 1434.055-1434.100 reserved for expansion)
253-15        SUBCHAPTER C.  DONATION OR USE OF PERMANENT IMPROVEMENTS
253-16         Sec. 1434.101.  DONATION OF PERMANENT IMPROVEMENTS.  (a)  A
253-17   county or municipality may donate to a general academic teaching
253-18   institution a permanent improvement acquired, constructed, or
253-19   improved by the county, by the municipality, or by the county and
253-20   the municipality jointly.
253-21         (b)  The donation is not subject to any law of this state
253-22   governing the disposition of property owned by a county or
253-23   municipality.  (V.A.C.S. Art. 1182n, Sec. 7.)
253-24         Sec. 1434.102.  USE OF PERMANENT IMPROVEMENTS.  (a)  A
253-25   municipality may allow a state four-year institution of higher
253-26   education or a university system to use land or buildings acquired
253-27   by the  municipality.
 254-1         (b)  This section does not apply to an institution of higher
 254-2   education that is supported in any way by revenue from a local tax
 254-3   base.
 254-4         (c)  A use under this section is a municipal purpose and a
 254-5   public use for the  municipality. (V.A.C.S. Art. 1182n, Sec. 3(d).)
 254-6        CHAPTER 1435.  BONDS FOR PARKS AND FAIRGROUND FACILITIES
 254-7                 IN CERTAIN MUNICIPALITIES AND COUNTIES
 254-8                    SUBCHAPTER A.  GENERAL PROVISIONS
 254-9   Sec. 1435.001.  APPLICABILITY OF CHAPTER; JOINT MUNICIPAL AND
254-10                     COUNTY ACTION
254-11   Sec. 1435.002.  DEFINITION
254-12   Sec. 1435.003.  AUTHORITY FOR PARK FACILITIES
254-13   Sec. 1435.004.  LEASE OR CONTRACT FOR OPERATION OF PARK
254-14                     FACILITIES
254-15           (Sections 1435.005-1435.050 reserved for expansion)
254-16                          SUBCHAPTER B.  BONDS
254-17   Sec. 1435.051.  AUTHORITY TO ISSUE REVENUE BONDS
254-18   Sec. 1435.052.  MATURITY
254-19   Sec. 1435.053.  DUTY OF GOVERNING BODY
254-20   Sec. 1435.054.  EXECUTION OF BONDS
254-21        CHAPTER 1435.  BONDS FOR PARKS AND FAIRGROUND FACILITIES
254-22                 IN CERTAIN MUNICIPALITIES AND COUNTIES
254-23                    SUBCHAPTER A.  GENERAL PROVISIONS
254-24         Sec. 1435.001.  APPLICABILITY OF CHAPTER; JOINT MUNICIPAL AND
254-25   COUNTY ACTION.  (a)  This chapter applies only to:
254-26               (1)  a municipality with a population greater than
254-27   550,000;
 255-1               (2)  a county with a population greater than 550,000;
 255-2   or
 255-3               (3)  a municipality described by Subdivision (1) and a
 255-4   county described by Subdivision (2) acting together.
 255-5         (b)  A provision of this chapter that applies to a
 255-6   municipality or county also applies to a municipality and county
 255-7   acting together.  (V.A.C.S. Art. 6081j, Sec. 1.)
 255-8         Sec. 1435.002.  DEFINITION.  In this chapter, "park facility"
 255-9   means a building, improvement, or structure owned by a municipality
255-10   or county and used in a municipal or county park or fairground for
255-11   exhibits, concessions, or entertainment. (V.A.C.S. Art. 6081j, Sec.
255-12   2 (part).)
255-13         Sec. 1435.003.  AUTHORITY FOR PARK FACILITIES.  A
255-14   municipality or county may:
255-15               (1)  construct, acquire, repair, improve, or enlarge a
255-16   park facility; or
255-17               (2)  acquire additional land, if needed, for a park
255-18   facility.  (V.A.C.S. Art. 6081j, Sec. 2 (part).)
255-19         Sec. 1435.004.  LEASE OR CONTRACT FOR OPERATION OF PARK
255-20   FACILITIES.  A municipality or county may enter a lease or contract
255-21   for the operation of one or more of its park facilities.  (V.A.C.S.
255-22   Art. 6081j, Sec. 3 (part).)
255-23           (Sections 1435.005-1435.050 reserved for expansion)
255-24                          SUBCHAPTER B.  BONDS
255-25         Sec. 1435.051.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  To
255-26   obtain money for a purpose described by Section 1435.003, the
255-27   governing body of a municipality or county may, without an
 256-1   election, issue revenue bonds payable from and secured by a pledge
 256-2   of the net revenue from one or more of its park facilities or from
 256-3   leases of or contracts for the operation of the park facilities.
 256-4         (b)  A bond issued under this chapter must state on its face
 256-5   substantially the following:  "The holder of this bond is not
 256-6   entitled to demand payment of this bond out of money raised by
 256-7   taxation."  (V.A.C.S. Art. 6081j, Sec. 4 (part).)
 256-8         Sec. 1435.052.  MATURITY.  A bond issued under this chapter
 256-9   must mature within 40 years.  (V.A.C.S. Art. 6081j, Sec. 5 (part).)
256-10         Sec. 1435.053.  DUTY OF GOVERNING BODY.  While the bonds are
256-11   outstanding, the governing body of the municipality or county
256-12   shall:
256-13               (1)  enforce each lease or contract entered under
256-14   Section 1435.004 and impose adequate fees, charges, and rentals to
256-15   assure payment of the principal of and interest on the bonds as
256-16   they become due; and
256-17               (2)  establish and maintain the funds as provided by
256-18   the ordinance authorizing the issuance of the bonds. (V.A.C.S.
256-19   Art. 6081j, Sec. 4 (part).)
256-20         Sec. 1435.054.  EXECUTION OF BONDS.  The bonds shall be
256-21   executed as provided by law for municipal bonds.  (V.A.C.S.
256-22   Art. 6081j, Sec. 5 (part).)
256-23               (Chapters 1436-1470 reserved for expansion)
256-24              SUBTITLE I.  SPECIFIC AUTHORITY FOR COUNTIES
256-25                           TO ISSUE SECURITIES
256-26                  CHAPTER 1471.  BONDS FOR COUNTY ROADS
256-27                    SUBCHAPTER A.  GENERAL PROVISIONS
 257-1   Sec. 1471.001.  APPLICABILITY OF CHAPTER
 257-2   Sec. 1471.002.  CONFLICTS OF LAW
 257-3           (Sections 1471.003-1471.010 reserved for expansion)
 257-4                    SUBCHAPTER B.  ISSUANCE OF BONDS
 257-5   Sec. 1471.011.  AUTHORITY TO ISSUE ROAD BONDS
 257-6   Sec. 1471.012.  EMERGENCY NOTES
 257-7   Sec. 1471.013.  TAX ANTICIPATION NOTES
 257-8   Sec. 1471.014.  BOND ANTICIPATION NOTES
 257-9   Sec. 1471.015.  ELECTION ON ISSUANCE OF BONDS:  COUNTY
257-10   Sec. 1471.016.  PETITION FOR ELECTION ON ISSUANCE OF
257-11                     BONDS:  PRECINCT OR ROAD DISTRICT
257-12   Sec. 1471.017.  HEARING ON AND DETERMINATION OF PETITION:
257-13                     PRECINCT OR ROAD DISTRICT
257-14   Sec. 1471.018.  NOTICE OF ELECTION
257-15   Sec. 1471.019.  RESULTS OF ELECTION
257-16   Sec. 1471.020.  EFFECT OF LACK OF NOTICE
257-17   Sec. 1471.021.  MATURITY
257-18   Sec. 1471.022.  DESIGNATION OF BONDS
257-19   Sec. 1471.023.  DISPOSITION OF BOND PROCEEDS
257-20   Sec. 1471.024.  DUTIES OF COUNTY TREASURER
257-21   Sec. 1471.025.  DISBURSEMENT OF BOND PROCEEDS BY COUNTY
257-22                     TREASURER
257-23   Sec. 1471.026.  INVESTMENT OF SINKING FUNDS
257-24   Sec. 1471.027.  USE OF BOND PROCEEDS OUTSIDE ROAD DISTRICT
257-25   Sec. 1471.028.  USE OF SURPLUS SINKING FUND
257-26   Sec. 1471.029.  ELECTION FOR REPURCHASE AND CANCELLATION
257-27                     OF BONDS
 258-1           (Sections 1471.030-1471.050 reserved for expansion)
 258-2         SUBCHAPTER C.  REFINANCING ROAD DISTRICT BONDS THROUGH
 258-3                               ASSESSMENTS
 258-4   Sec. 1471.051.  ALTERNATE REFUNDING BONDS AND CERTIFICATES
 258-5                     OF ASSESSMENT AUTHORIZED
 258-6   Sec. 1471.052.  ASSESSMENT AS SECURITY
 258-7   Sec. 1471.053.  MATURITY
 258-8   Sec. 1471.054.  PREPARATION OF ASSESSMENT
 258-9   Sec. 1471.055.  NOTICE OF HEARING
258-10   Sec. 1471.056.  IMPOSITION OF ASSESSMENT
258-11   Sec. 1471.057.  APPEAL OF ASSESSMENT
258-12   Sec. 1471.058.  REASSESSMENT
258-13   Sec. 1471.059.  ADJUSTMENT OF VALUES FOLLOWING REASSESSMENT
258-14   Sec. 1471.060.  LIEN FOR UNPAID ASSESSMENT
258-15   Sec. 1471.061.  ISSUANCE AND FORM OF CERTIFICATES
258-16   Sec. 1471.062.  ASSESSMENTS CONSIDERED TAXES
258-17           (Sections 1471.063-1471.080 reserved for expansion)
258-18                    SUBCHAPTER D.  COMPENSATION BONDS
258-19   Sec. 1471.081.  ELECTION AUTHORIZED
258-20   Sec. 1471.082.  ISSUANCE OF COUNTY BONDS
258-21   Sec. 1471.083.  EXCHANGE OF BONDS
258-22   Sec. 1471.084.  DEPOSIT OF COUNTY BONDS AS GUARANTEE
258-23   Sec. 1471.085.  TERMS AND FORM OF COMPENSATION BONDS; USE
258-24                     OF SURPLUS BONDS
258-25   Sec. 1471.086.  CREATION OF ROAD DISTRICT CONTAINING ENTIRE
258-26                     TERRITORY OF EXISTING DISTRICT
258-27   Sec. 1471.087.  CREATION OF ROAD DISTRICT CONTAINING PORTION
 259-1                     OF TERRITORY OF EXISTING DISTRICT
 259-2                  CHAPTER 1471.  BONDS FOR COUNTY ROADS
 259-3                    SUBCHAPTER A.  GENERAL PROVISIONS
 259-4         Sec. 1471.001.  APPLICABILITY OF CHAPTER.  This chapter
 259-5   applies only to the following political subdivisions:
 259-6               (1)  a county, including a county operating under a
 259-7   special road tax law;
 259-8               (2)  a commissioners precinct or a justice precinct of
 259-9   a county; and
259-10               (3)  a road district.  (V.A.C.S. Art. 726, Secs.
259-11   2.001(a), 2.016 (part); New.)
259-12         Sec. 1471.002.  CONFLICTS OF LAW.  To the extent of a
259-13   conflict between this chapter and Chapter 1204, Chapter 1204
259-14   controls.  (V.A.C.S. Art. 726, Sec. 4.001.)
259-15           (Sections 1471.003-1471.010 reserved for expansion)
259-16                    SUBCHAPTER B.  ISSUANCE OF BONDS
259-17         Sec. 1471.011.  AUTHORITY TO ISSUE ROAD BONDS.  (a)  In this
259-18   section, "bonds" includes tax anticipation notes, bond anticipation
259-19   notes, and other obligations.
259-20         (b)  A political subdivision may issue bonds in the manner
259-21   provided by this chapter and Section 52, Article III, Texas
259-22   Constitution, to:
259-23               (1)  construct, purchase, maintain, or operate a
259-24   macadamized, graveled, or paved road or turnpike; or
259-25               (2)  aid a purpose described by Subdivision (1).
259-26         (c)  An issuer of bonds under Subsection (b) may impose ad
259-27   valorem taxes to pay the interest on the bonds and provide a
 260-1   sinking fund for the redemption of the bonds.
 260-2         (d)  The total amount of bonds issued under this chapter may
 260-3   not exceed one-fourth of the assessed value of real property of the
 260-4   political subdivision issuing the bonds.
 260-5         (e)  In determining the limitation imposed by Subsection (d),
 260-6   the assessed value of property of the political subdivision is the
 260-7   market value of the property as recorded by the chief appraiser of
 260-8   the appraisal district that appraises property for the political
 260-9   subdivision.  (V.A.C.S. Art. 726, Sec. 2.001(b).)
260-10         Sec. 1471.012.  EMERGENCY NOTES.  (a)  If money is not
260-11   available, a political subdivision may:
260-12               (1)  declare an emergency to:
260-13                     (A)  pay the principal of and interest on bonds
260-14   issued under this chapter any part of which is payable from taxes;
260-15   or
260-16                     (B)  meet any other need of the political
260-17   subdivision; and
260-18               (2)  issue tax or bond anticipation notes to borrow the
260-19   money needed.
260-20         (b)  Notes issued under this section must mature not later
260-21   than one year after their date.  (V.A.C.S.  Art. 726, Sec. 2.002(a)
260-22   (part).)
260-23         Sec. 1471.013.  TAX ANTICIPATION NOTES.  (a)  A political
260-24   subdivision may issue tax anticipation notes authorized by Section
260-25   1471.012 for any purpose for which the political subdivision is
260-26   authorized to impose taxes under Subtitle C, Title 6,
260-27   Transportation Code.
 261-1         (b)  Tax anticipation notes must be secured by the proceeds
 261-2   of taxes to be imposed in the succeeding 12 months.
 261-3         (c)  The commissioners court may covenant with purchasers of
 261-4   the notes to impose a tax sufficient to pay:
 261-5               (1)  the principal of and interest on the notes; and
 261-6               (2)  the costs of collecting the taxes.  (V.A.C.S.
 261-7   Art. 726, Sec. 2.002(b).)
 261-8         Sec. 1471.014.  BOND ANTICIPATION NOTES.  (a)  A political
 261-9   subdivision may issue bond anticipation notes authorized by Section
261-10   1471.012 for:
261-11               (1)  any purpose for which bonds of the political
261-12   subdivision have been previously approved at an election; or
261-13               (2)  refunding previously issued bond anticipation
261-14   notes.
261-15         (b)  A political subdivision may covenant with the purchasers
261-16   of the bond anticipation notes to use the proceeds of sale of any
261-17   bonds in the process of being issued to refund the bond
261-18   anticipation notes.  An issuer making a covenant under this
261-19   subsection shall apply the proceeds received from the sale of the
261-20   bonds in the process of being issued to pay the principal of,
261-21   interest on, or redemption price of the bond anticipation notes.
261-22   (V.A.C.S. Art. 726, Sec.  2.002(c).)
261-23         Sec. 1471.015.  ELECTION ON ISSUANCE OF BONDS:  COUNTY.  (a)
261-24   On the motion of the commissioners court or on receipt of a
261-25   petition signed by a number of registered voters of the county
261-26   equal to at least one percent of the total votes cast in the county
261-27   in the most recent general election for governor, the court at a
 262-1   regular or special session shall order an election to be held in
 262-2   the county to determine whether the county shall:
 262-3               (1)  issue bonds to:
 262-4                     (A)  construct, maintain, or operate a
 262-5   macadamized, graveled, or paved road or turnpike; or
 262-6                     (B)  aid a purpose described by Paragraph (A);
 262-7   and
 262-8               (2)  impose taxes on all property in the county subject
 262-9   to taxation to pay the interest on the bonds and to provide a
262-10   sinking fund for the redemption of the bonds at maturity.
262-11         (b)  A petition submitted under Subsection (a) that
262-12   designates a particular road or project or a portion of a road or
262-13   project must be accompanied by a written estimate of the cost of
262-14   the road or project prepared by the county engineer at the expense
262-15   of the county.
262-16         (c)  In addition to the requirements provided by Chapters 3
262-17   and 4, Election Code, the election order and notice of election
262-18   under this section must state:
262-19               (1)  the purpose for which the bonds are to be issued;
262-20               (2)  the amount of the bonds;
262-21               (3)  the rate of interest; and
262-22               (4)  that ad valorem taxes will be imposed annually on
262-23   all taxable property in the county in amounts sufficient to pay the
262-24   bonds at maturity.  (V.A.C.S. Art. 726, Secs. 2.003, 2.007 (part).)
262-25         Sec. 1471.016.  PETITION FOR ELECTION ON ISSUANCE OF BONDS:
262-26   PRECINCT OR ROAD DISTRICT.  (a)  A commissioners or justice
262-27   precinct or a road district may not issue bonds under this chapter
 263-1   unless a petition is submitted to the commissioners court of the
 263-2   county and an election is ordered under Section 1471.017.
 263-3         (b)  A petition under this section must:
 263-4               (1)  request the commissioners court of the county in
 263-5   which the precinct or district is located to order an election to
 263-6   determine whether:
 263-7                     (A)  bonds of the precinct or district shall be
 263-8   issued in an amount stated to:
 263-9                           (i)  construct, maintain, or operate a
263-10   macadamized, graveled, or paved road or turnpike; or
263-11                           (ii)  aid an activity described in
263-12   Subparagraph (i); and
263-13                     (B)  taxes shall be imposed on all taxable
263-14   property in the precinct or district in payment of the bonds; and
263-15               (2)  be signed by:
263-16                     (A)  50 or a majority of the registered voters of
263-17   the precinct or district; or
263-18                     (B)  all of the owners of property in the
263-19   precinct or district as determined by the county tax roll.
263-20         (c)  On receipt of the petition, the commissioners court by
263-21   order shall set the time and place for a hearing.  The date of the
263-22   hearing may not be less than 15 days or more than 90 days after the
263-23   date the commissioners court orders the hearing.  The county clerk
263-24   shall immediately issue a notice of the time and place of the
263-25   hearing.
263-26         (d)  The notice of the hearing must:
263-27               (1)  inform all interested persons of their right to
 264-1   appear at the hearing and contend for or protest the ordering of
 264-2   the bond election;
 264-3               (2)  state the amount of bonds proposed to be issued
 264-4   and describe the precinct or district by its name or number;
 264-5               (3)  for a district:
 264-6                     (A)  include a description of the property
 264-7   comprising the district, including the district's estimated acreage
 264-8   and boundaries, described in a manner reasonably calculated to
 264-9   inform interested persons of the area comprising the district; and
264-10                     (B)  include a map or diagram of the area
264-11   reasonably calculated to show the boundaries of the district and
264-12   the major roadways in or adjacent to the district; and
264-13               (4)  designate a county officer or employee from whom
264-14   further details may be obtained.
264-15         (e)  The clerk shall execute notice under this section in the
264-16   same manner as required for an election under Section 1471.018.
264-17   (V.A.C.S. Art. 726, Secs. 2.004(a), (b).)
264-18         Sec. 1471.017.  HEARING ON AND DETERMINATION OF PETITION:
264-19   PRECINCT OR ROAD DISTRICT.  (a)  At the hearing on a petition
264-20   submitted under Section 1471.016, the commissioners court shall
264-21   hear all matters pertaining to the proposed bond election.  Any
264-22   interested person may appear before the court in person or by
264-23   attorney and contend for or protest the calling of the proposed
264-24   bond election.
264-25         (b)  The commissioners court may order that an election be
264-26   held in the commissioners or justice precinct or road district on
264-27   the issue submitted in the petition if the court finds that:
 265-1               (1)  the petition is signed by the proper number of
 265-2   qualified persons;
 265-3               (2)  the required notice has been given; and
 265-4               (3)  the proposed improvements would benefit all
 265-5   taxable property in the precinct or district.
 265-6         (c)  The commissioners court may change the amount of bonds
 265-7   proposed to be issued if at the hearing the court finds the change
 265-8   is necessary or desirable.
 265-9         (d)  The proposition submitted at the election must specify:
265-10               (1)  the purpose for which the bonds are to be issued;
265-11               (2)  the amount of the bonds;
265-12               (3)  the rate of interest; and
265-13               (4)  that ad valorem taxes are to be imposed annually
265-14   on all taxable property in the precinct or district in an amount
265-15   sufficient to pay the annual interest and provide a sinking fund to
265-16   pay the bonds at maturity.
265-17         (e)  A proposition meets the requirements of this chapter if
265-18   it is in the following form:
265-19         "Authorizing the (name of precinct or district) to issue its
265-20   bonds in the total sum of $__________ and to impose annually ad
265-21   valorem taxes on all taxable property in the (precinct or district)
265-22   to pay the interest on the bonds and create a sinking fund to
265-23   redeem the principal at maturity for the purposes of the purchase
265-24   or acquisition of roads and the construction, maintenance, and
265-25   operation of macadamized, graveled, or paved roads and turnpikes or
265-26   in aid of those purposes inside or outside the boundaries of the
265-27   (precinct or district)."  (V.A.C.S. Art. 726, Sec. 2.005 (part).)
 266-1         Sec. 1471.018.  NOTICE OF ELECTION.  (a)  Notice for all
 266-2   elections held under this chapter must be given as required by
 266-3   Chapter 4, Election Code.  The commissioners court shall give
 266-4   notice of an election to be held for a commissioners or justice
 266-5   precinct or a road district by posting notice in at least three
 266-6   public places in the precinct or district and at the county
 266-7   courthouse door.
 266-8         (b)  The commissioners court may, in addition to the notice
 266-9   required by Subsection (a), prescribe that notice of an election or
266-10   hearing for bonds to be issued for a precinct or district be given
266-11   by mail to:
266-12               (1)  each registered voter in the precinct or district;
266-13               (2)  each owner of property in the precinct or district
266-14   as shown on the tax roll of the county; and
266-15               (3)  each person having an interest in property in the
266-16   precinct or district as may reasonably be ascertained.
266-17         (c)  Notice given under Subsection (b) is effective when
266-18   properly addressed and mailed.  (V.A.C.S. Art. 726, Secs. 2.006(a)
266-19   (part), (b).)
266-20         Sec. 1471.019.  RESULTS OF ELECTION.  The commissioners court
266-21   may issue bonds on the faith and credit of the applicable political
266-22   subdivision if two-thirds of the voters voting in the election
266-23   approve the issuance of the bonds.  (V.A.C.S. Art. 726, Sec.
266-24   2.009.)
266-25         Sec. 1471.020.  EFFECT OF LACK OF NOTICE.  Notice under
266-26   Section 1471.016(d) or 1471.018(a) is not a prerequisite to and
266-27   does not affect the validity of a hearing or election to which the
 267-1   notice relates.  (V.A.C.S. Art. 726, Sec. 2.006(a) (part).)
 267-2         Sec. 1471.021.  MATURITY.  A bond issued under this chapter
 267-3   must mature not later than 30 years after its date  except as
 267-4   otherwise provided by this chapter.  (V.A.C.S. Art. 726, Sec. 2.010
 267-5   (part).)
 267-6         Sec. 1471.022.  DESIGNATION OF BONDS.  (a)  Bonds issued
 267-7   under this chapter by the county as a whole must be designated as
 267-8   "________ (name of county) County Road Bonds."
 267-9         (b)  Bonds issued under this chapter for a commissioners or
267-10   justice precinct or a road district must:
267-11               (1)  be designated as "Road Bonds"; and
267-12               (2)  state on their face "The State of Texas," the name
267-13   of the county, and the number or corporate name of the precinct or
267-14   district issuing the bonds.
267-15         (c)  Bonds issued under this chapter must state on their face
267-16   that the bonds are issued under Section 52, Article III, Texas
267-17   Constitution, and laws enacted under the constitution.  (V.A.C.S.
267-18   Art. 726, Secs. 2.014, 2.015.)
267-19         Sec. 1471.023.  DISPOSITION OF BOND PROCEEDS.  (a)  The
267-20   commissioners court has the custody and control of bonds or bond
267-21   anticipation notes issued under this chapter until sold under
267-22   Chapter 1201.
267-23         (b)  The portion of the proceeds that represents capitalized
267-24   interest shall be placed in the county treasury to the credit of
267-25   the applicable political subdivision and may be used only to pay
267-26   interest due on the bonds or bond anticipation notes.
267-27         (c)  Money remaining from the proceeds after the amounts
 268-1   described in Subsection (b) are deposited and after the costs of
 268-2   the issuance of the bonds or bond anticipation notes are paid shall
 268-3   be placed in the county treasury to the credit of the available
 268-4   road fund of the applicable political subdivision to be used for
 268-5   the purposes for which the bonds were issued, including:
 268-6               (1)  payment of the following costs as approved by the
 268-7   commissioners court:
 268-8                     (A)  surveying;
 268-9                     (B)  creation;
268-10                     (C)  construction or acquisition; or
268-11                     (D)  operation or maintenance; and
268-12               (2)  payment or establishment of a reasonable reserve
268-13   to pay an amount equal to not more than three years' interest on
268-14   the notes and bonds of the political subdivision, as provided in
268-15   the bond order or resolution.  (V.A.C.S. Art. 726, Secs.  2.011,
268-16   2.020.)
268-17         Sec. 1471.024.  DUTIES OF COUNTY TREASURER.  (a)  The county
268-18   treasurer is the custodian of:
268-19               (1)  all money collected under this chapter; and
268-20               (2)  all taxes collected to pay principal of and
268-21   interest on bonds issued under this chapter.
268-22         (b)  The county treasurer shall:
268-23               (1)  deposit the money collected with the county
268-24   depository in the same manner as other money of the county; and
268-25               (2)  promptly pay the principal of and interest on the
268-26   bonds as they become due from the money collected and deposited for
268-27   that purpose.  (V.A.C.S. Art. 726, Sec. 2.012.)
 269-1         Sec. 1471.025.  DISBURSEMENT OF BOND PROCEEDS BY COUNTY
 269-2   TREASURER.  (a)  The proceeds of county bonds may be paid out only
 269-3   by the county treasurer on warrants:
 269-4               (1)  drawn on the available road fund;
 269-5               (2)  issued by the county clerk;
 269-6               (3)  countersigned by the county judge; and
 269-7               (4)  on certified accounts approved by the
 269-8   commissioners court.
 269-9         (b)  The proceeds of bonds issued on the faith and credit of
269-10   a commissioners or justice precinct or a road district may be paid
269-11   out only by the county treasurer on warrants:
269-12               (1)  drawn on the available road fund of the applicable
269-13   political subdivision;
269-14               (2)  issued by the county clerk;
269-15               (3)  countersigned by the county judge; and
269-16               (4)  approved by the commissioners court.  (V.A.C.S.
269-17   Art. 726, Sec.  2.013.)
269-18         Sec. 1471.026.  INVESTMENT OF SINKING FUNDS.  (a)  The
269-19   commissioners court may invest money in a sinking fund accumulated
269-20   for the redemption and payment of any bonds issued under this
269-21   chapter in:
269-22               (1)  bonds of the United States, this state, or a
269-23   county, municipality, school district, or road district of this
269-24   state;
269-25               (2)  bonds of the Federal Farm Loan Bank system; or
269-26               (3)  certificates of indebtedness issued by the
269-27   secretary of the treasury of the United States.
 270-1         (b)  Sinking funds accumulated for the redemption and payment
 270-2   of bonds issued under this chapter may not be invested in bonds the
 270-3   terms of which provide for a maturity date after the date of
 270-4   maturity of the bonds for which the sinking fund was created.
 270-5         (c)  Interest on an investment shall be applied to the
 270-6   sinking fund associated with the investment.  (V.A.C.S. Art. 726,
 270-7   Secs. 1.001, 1.002 (part).)
 270-8         Sec. 1471.027.  USE OF BOND PROCEEDS OUTSIDE ROAD DISTRICT.
 270-9   A road district may use the proceeds of bonds issued under this
270-10   chapter for road improvements located outside the district if the
270-11   commissioners court finds that the improvements are reasonable,
270-12   necessary, and beneficial to all taxable property in the district.
270-13   (V.A.C.S. Art. 726, Sec. 2.021.)
270-14         Sec. 1471.028.  USE OF SURPLUS SINKING FUND.  An amount
270-15   remaining in the sinking fund after the principal of and interest
270-16   on the bonds are fully paid may be used by a political subdivision:
270-17               (1)  for the construction, maintenance, and operation
270-18   of macadamized, graveled, or paved roads or turnpikes;
270-19               (2)  to aid a purpose described by Subdivision (1); or
270-20               (3)  for a permanent improvement authorized by law as
270-21   determined by the officials of the political subdivision. (V.A.C.S.
270-22   Art. 726, Sec. 2.001(c).)
270-23         Sec. 1471.029.  ELECTION FOR REPURCHASE AND CANCELLATION OF
270-24   BONDS.  (a)  On receipt of a petition signed by at least 50
270-25   registered voters of the political subdivision issuing the bonds,
270-26   the commissioners court shall order an election to determine
270-27   whether road bonds in an amount equal to the unexpended and
 271-1   unpledged proceeds remaining from the sale of bonds issued under
 271-2   this chapter shall be repurchased, canceled, and revoked.
 271-3         (b)  The commissioners court shall hold an election ordered
 271-4   under Subsection (a) in the same manner as the election at which
 271-5   the bonds were originally authorized.
 271-6         (c)  The commissioners court may advertise for and repurchase
 271-7   the outstanding bonds from the holders if two-thirds of the voters
 271-8   voting in the election approve the repurchase, cancellation, and
 271-9   revocation.
271-10         (d)  After repurchasing the bonds, the commissioners court
271-11   shall:
271-12               (1)  cancel and burn the bonds; and
271-13               (2)  forward to the comptroller a certified copy of the
271-14   minutes of the commissioners court showing the repurchase,
271-15   cancellation, and destruction of the bonds.
271-16         (e)  On receipt of a copy under Subsection (d)(2), the
271-17   comptroller shall promptly cancel the registration of the bonds.
271-18   (V.A.C.S. Art. 726, Secs. 1.003(a), (b) (part).)
271-19           (Sections 1471.030-1471.050 reserved for expansion)
271-20         SUBCHAPTER C.  REFINANCING ROAD DISTRICT BONDS THROUGH
271-21                               ASSESSMENTS
271-22         Sec. 1471.051.  ALTERNATE REFUNDING BONDS AND CERTIFICATES OF
271-23   ASSESSMENT AUTHORIZED.  A road district may issue refunding bonds
271-24   or certificates of assessment under this subchapter to refinance
271-25   any portion of any outstanding bonded indebtedness if:
271-26               (1)  the district receives a petition that:
271-27                     (A)  requests the issuance of the bonds or
 272-1   certificates; and
 272-2                     (B)  is signed by persons who own taxable real
 272-3   property in the district that in total is valued at an amount at
 272-4   least equal to 66 percent of the appraised value of all taxable
 272-5   real property in the district, as determined by the most recent
 272-6   certified appraisal roll of the appraisal district in which the
 272-7   property is located; and
 272-8               (2)  the district determines, after notice and public
 272-9   hearing held in accordance with this subchapter, that the property
272-10   in the district will benefit from the refinancing.  (V.A.C.S.
272-11   Art. 726, Sec. 2.018(a).)
272-12         Sec. 1471.052.  ASSESSMENT AS SECURITY.  Bonds or
272-13   certificates issued under this subchapter must be secured by a
272-14   pledge of all or part of the money received by the road district
272-15   from an assessment made against all taxable real property in the
272-16   district under this subchapter.  (V.A.C.S. Art. 726, Sec.
272-17   2.018(b).)
272-18         Sec. 1471.053.  MATURITY.  A bond or certificate issued under
272-19   this subchapter must mature not later than 30 years after its date
272-20   of issuance.  (V.A.C.S. Art. 726, Sec. 2.018(c) (part).)
272-21         Sec. 1471.054.  PREPARATION OF ASSESSMENT.  Before issuing
272-22   bonds or certificates under this subchapter, the road district by
272-23   order shall:
272-24               (1)  determine, as appropriate, the amount necessary to
272-25   pay all or a part of the principal of and interest on:
272-26                     (A)  the refunding bonds on maturity; or
272-27                     (B)  the outstanding bonded indebtedness of the
 273-1   district;
 273-2               (2)  prepare a plan the district determines is
 273-3   equitable for apportioning the amount determined under Subdivision
 273-4   (1) among the record owners of real property in the district based
 273-5   on the ratio that the appraised value of each lot or parcel in the
 273-6   district bears to the total appraised value of real property in the
 273-7   district; and
 273-8               (3)  hold a public hearing on the district's intention
 273-9   to issue bonds or certificates.  (V.A.C.S. Art. 726, Sec.  2.018(d)
273-10   (part).)
273-11         Sec. 1471.055.  NOTICE OF HEARING.  (a)  Notice of the
273-12   hearing ordered under Section 1471.054 must provide:
273-13               (1)  the date, time, place, and subject matter of the
273-14   hearing;
273-15               (2)  that refunding bonds or certificates of assessment
273-16   are proposed to be issued by the road district;
273-17               (3)  the purpose for which the bonds or certificates
273-18   are to be issued;
273-19               (4)  the amount determined under Section 1471.054(1);
273-20   and
273-21               (5)  the plan prepared by the district under Section
273-22   1471.054(2).
273-23         (b)  Notice containing the information required by Subsection
273-24   (a)  must be published in a newspaper of general circulation in the
273-25   county not later than the 30th day before the date of the hearing.
273-26         (c)  Not later than the 14th day before the date of the
273-27   hearing, the district shall mail to each owner of real property in
 274-1   the district as determined from the most recent certified appraisal
 274-2   roll of the appraisal district in which the property is located
 274-3   notice containing:
 274-4               (1)  the information required by Subsection (a)(1); and
 274-5               (2)  an estimate of the amount of the assessment to be
 274-6   apportioned to that owner's property.
 274-7         (d)  The failure of a property owner to receive notice of the
 274-8   hearing and of the estimated assessment does not affect the
 274-9   validity of the hearing or a subsequent assessment.  (V.A.C.S.
274-10   Art. 726, Secs. 2.018(d) (part), (e).)
274-11         Sec. 1471.056.  IMPOSITION OF ASSESSMENT.  (a)  If, at the
274-12   conclusion of the hearing, the road district by order determines
274-13   that the property in the district will benefit from refinancing
274-14   under this subchapter, the district may:
274-15               (1)  issue refunding bonds or certificates of
274-16   assessment to pay all or part of the district's bonded
274-17   indebtedness; and
274-18               (2)  impose the assessments as special assessments on
274-19   the property in the district.
274-20         (b)  For assessments imposed under Subsection (a), the
274-21   district:
274-22               (1)  shall specify the method of payment and rate of
274-23   interest of the assessments; and
274-24               (2)  may provide for payment in periodic installments
274-25   in amounts necessary to pay the principal of and interest on the
274-26   refunding bonds or certificates of assessment as accrued.
274-27   (V.A.C.S. Art. 726, Sec. 2.018(f) (part).)
 275-1         Sec. 1471.057.  APPEAL OF ASSESSMENT.  (a)  A property owner
 275-2   may appeal an assessment under this subchapter by filing a notice
 275-3   of appeal with the road district not later than the 30th day after
 275-4   the date the assessment is adopted.  After receiving notice of
 275-5   appeal under this subsection, the district shall set a date to hear
 275-6   the appeal.
 275-7         (b)  A property owner may appeal a district's decision on an
 275-8   assessment made under this subchapter to a court by filing notice
 275-9   of the appeal with the court not later than the 30th day after the
275-10   date of the district's final decision on the assessment.
275-11         (c)  A property owner who fails to file notice in the time
275-12   required by Subsection (a) or (b) loses the right to appeal the
275-13   assessment.  (V.A.C.S. Art. 726, Sec. 2.018(g).)
275-14         Sec. 1471.058.  REASSESSMENT.  (a)  A road district may make
275-15   a new assessment of property assessed under this subchapter if an
275-16   assessment of the property is:
275-17               (1)  set aside by a court;
275-18               (2)  found excessive by the district; or
275-19               (3)  determined invalid by the district.
275-20         (b)  A district may reassess property if:
275-21               (1)  at the time the bonds or certificates are issued
275-22   under this subchapter, the property is exempt from taxation under
275-23   Subchapter B, Chapter 11, Tax Code, or appraised under Subchapter
275-24   C, D, or E, Chapter 23, Tax Code; and
275-25               (2)  the property subsequently loses its exemption or
275-26   is not eligible for appraisal under Subchapter C, D, or E, Chapter
275-27   23, Tax Code.
 276-1         (c)  A district may make a supplemental assessment to correct
 276-2   an omission or mistake in an assessment.
 276-3         (d)  Before making an assessment under Subsection (b) or (c),
 276-4   a district must give notice and conduct a hearing in the manner
 276-5   required for an original assessment.  (V.A.C.S. Art. 726, Secs.
 276-6   2.018(h), (i), (j).)
 276-7         Sec. 1471.059.  ADJUSTMENT OF VALUES FOLLOWING REASSESSMENT.
 276-8   (a)  In making a reassessment under Section 1471.058(b), the road
 276-9   district shall assess the property using the property's market
276-10   value for the year preceding the year in which the bonds or
276-11   certificates are issued.
276-12         (b)  The district shall proportionately reduce the assessment
276-13   of the other property in the district to reflect the value of the
276-14   reassessed property.  The district shall refund to a property owner
276-15   the difference between the amount of the original assessment and a
276-16   new assessment under this subsection if the property owner has paid
276-17   the entire amount of the original assessment.  (V.A.C.S. Art. 726,
276-18   Sec.  2.018(k).)
276-19         Sec. 1471.060.  LIEN FOR UNPAID ASSESSMENT.  (a)  An
276-20   assessment under this subchapter, any interest, and any expenses of
276-21   collection or reasonable attorney's fees incurred are a lien
276-22   against the assessed property until paid.
276-23         (b)  A lien under Subsection (a):
276-24               (1)  is superior to any other lien except an ad valorem
276-25   tax lien; and
276-26               (2)  is effective from the date the assessment is
276-27   imposed until the date the total amount of the assessment for the
 277-1   property is paid.
 277-2         (c)  A road district may enforce a lien under Subsection (a)
 277-3   in the same manner as the commissioners court enforces an ad
 277-4   valorem tax lien.
 277-5         (d)  The owner of assessed property is personally liable for
 277-6   the payment of an assessment under this subchapter and may pay at
 277-7   any time the entire amount of the assessment and accrued interest
 277-8   on any lot or parcel.  Liability for an assessment passes with the
 277-9   property on a transfer of ownership.
277-10         (e)  A lien for a supplemental assessment or reassessment is
277-11   effective even if the property has been released from a prior lien
277-12   under this subchapter.  (V.A.C.S. Art. 726, Sec. 2.018(l).)
277-13         Sec. 1471.061.  ISSUANCE AND FORM OF CERTIFICATES.  (a)  A
277-14   road district may issue and transfer, on terms determined by the
277-15   district, a certificate of assessment for each assessed lot or
277-16   parcel.  A certificate of assessment may be issued under Chapter
277-17   1207 as if it were a bond.  On making a supplemental assessment or
277-18   reassessment, the district shall provide a certificate of
277-19   assessment reflecting any change in the value of the original
277-20   assessment.
277-21         (b)  A certificate must state:
277-22               (1)  the amount of the lien on the assessed property;
277-23               (2)  the liability of the property owner for the lien;
277-24               (3)  the terms of transfer of the certificate;
277-25               (4)  that the assessment was imposed and the
277-26   certificate was issued under this subchapter; and
277-27               (5)  that the certificate is not an obligation of or
 278-1   secured by a pledge of the faith or credit of a county in which the
 278-2   district is located.
 278-3         (c)  A certificate is prima facie evidence of all the matters
 278-4   shown on the certificate.
 278-5         (d)  A holder of the certificate may enforce the assessment
 278-6   in the same manner as the district may enforce assessments made
 278-7   under this subchapter.  (V.A.C.S. Art. 726, Secs. 2.018(c) (part),
 278-8   (m).)
 278-9         Sec. 1471.062.  ASSESSMENTS CONSIDERED TAXES.  For purposes
278-10   of a title insurance policy issued under Chapter 9, Insurance Code,
278-11   an assessment under this subchapter and any interest on or expenses
278-12   or attorney's fees related to the assessment are considered taxes.
278-13   (V.A.C.S.  Art. 726, Sec. 2.018(n).)
278-14           (Sections 1471.063-1471.080 reserved for expansion)
278-15                    SUBCHAPTER D.  COMPENSATION BONDS
278-16         Sec. 1471.081.  ELECTION AUTHORIZED.  (a)  On receipt of a
278-17   petition signed by 250 registered voters residing anywhere in the
278-18   county, the commissioners court shall order an election in the
278-19   county to determine whether bonds of the county shall be issued to
278-20   fully compensate a commissioners or justice precinct or a road
278-21   district for bonds authorized to be issued under a general or
278-22   special law adopted under Section 52, Article III, Texas
278-23   Constitution.
278-24         (b)  At the election, the ballot proposition must include:
278-25               (1)  the purpose for which the bonds are to be issued;
278-26   and
278-27               (2)  the question as to whether a tax shall be imposed
 279-1   on the taxable property in the county to pay the interest on the
 279-2   bonds and to provide a sinking fund for the redemption of the
 279-3   bonds.
 279-4         (c)  If the bonds of the precinct or district have been
 279-5   authorized but not issued and sold or if the bonds have been sold
 279-6   but the proceeds have not been spent, the ballot proposition must
 279-7   state: "The issuance of county bonds for the construction of
 279-8   district roads and the further construction, maintenance, and
 279-9   operation of macadamized, graveled, or paved roads and turnpikes,
279-10   or in aid of these purposes, throughout the county."
279-11         (d)  If the bonds of the precinct or district have been
279-12   issued and the proceeds have been applied to the construction of
279-13   roads in the precinct or district, the ballot proposition must
279-14   state: "The issuance of county bonds for the purchase of district
279-15   roads and the further construction, maintenance, and operation of
279-16   macadamized, graveled, or paved roads and turnpikes, or in aid of
279-17   these purposes, throughout the county."  (V.A.C.S. Art. 726, Secs.
279-18   3.001(a), (b), (c) (part), (d) (part), (e) (part).)
279-19         Sec. 1471.082.  ISSUANCE OF COUNTY BONDS.  (a)  If the
279-20   proposition to issue county bonds receives the required favorable
279-21   vote, the county shall issue the bonds in the amount stated in the
279-22   election order, but not in an amount that exceeds a limitation
279-23   imposed by the constitution or a statute.
279-24         (b)  After the county issues the bonds, the commissioners
279-25   court shall set aside the amount necessary to fully compensate the
279-26   commissioners or justice precinct or road district for the purpose
279-27   for which the bonds were issued.
 280-1         (c)  If the bonds are approved for the purpose described by
 280-2   Section 1471.081(c) and the precinct or district bonds have not
 280-3   been issued and sold, the commissioners court shall:
 280-4               (1)  apply the proceeds of the county bonds to the
 280-5   construction, maintenance, and operation of the roads in the
 280-6   precinct or district as contemplated by the election approving the
 280-7   precinct or district bonds; and
 280-8               (2)  immediately cancel and destroy the unsold precinct
 280-9   or district bonds.
280-10         (d)  If the bonds are approved for the purpose described by
280-11   Section 1471.081(d), the roads of the precinct or district may
280-12   become a part of the county road system. (V.A.C.S. Art. 726, Secs.
280-13   3.001(c) (part), (d) (part), (e) (part), 3.002(a) (part).)
280-14         Sec. 1471.083.  EXCHANGE OF BONDS.  (a)  If county bonds are
280-15   authorized for commissioners or justice precinct or road district
280-16   bonds that have been issued and sold, an exchange of a like amount
280-17   of the county bonds may be made with the holder of any outstanding
280-18   bonds of the precinct or district.
280-19         (b)  An agreement for an exchange under this section must:
280-20               (1)  be by order of the commissioners court authorizing
280-21   the exchange; and
280-22               (2)  contain the signed and acknowledged written
280-23   consent of the holder of the bonds in the form required by law for
280-24   written instruments.
280-25         (c)  A copy of the order authorizing the exchange, the
280-26   agreement, and the county bonds to be given in exchange shall be
280-27   submitted to the attorney general for approval.  The exchange is
 281-1   not effective until the attorney general issues a certificate
 281-2   approving the exchange.
 281-3         (d)  If the exchange takes effect under this section:
 281-4               (1)  the commissioners court shall cancel and destroy
 281-5   the bonds of the precinct or district;
 281-6               (2)  the county may not impose the tax approved at the
 281-7   election of the precinct or district authorizing the bonds; and
 281-8               (3)  the sinking fund associated with the bonds of the
 281-9   precinct or district shall be transferred to the sinking fund
281-10   account of the county.  (V.A.C.S. Art. 726, Secs. 3.001(d) (part),
281-11   (e) (part), 3.002(b).)
281-12         Sec. 1471.084.  DEPOSIT OF COUNTY BONDS AS GUARANTEE.  (a)
281-13   If the commissioners court determines that an exchange cannot be
281-14   made under Section 1471.083, the court as soon as practicable shall
281-15   deposit with the county treasurer to the credit of the interest and
281-16   sinking fund account of the commissioners or justice precinct or
281-17   road district an amount of county bonds equal to the amount of
281-18   outstanding bonds of the precinct or district.
281-19         (b)  Before depositing the county bonds under Subsection (a),
281-20   the commissioners court shall submit to the attorney general a copy
281-21   of the order authorizing the deposit and the county bonds to be
281-22   deposited.  The county bonds may be deposited only if the attorney
281-23   general issues a certificate of approval.
281-24         (c)  To be deposited under this section, county bonds must:
281-25               (1)  have the word "nonnegotiable" written across the
281-26   face of the bond; and
281-27               (2)  state that the bonds are deposited to the credit
 282-1   of the interest and sinking fund account of the precinct or
 282-2   district named in the bonds as a guarantee of the payment of the
 282-3   outstanding bonds of the precinct or district that have not been
 282-4   exchanged.
 282-5         (d)  Coupons attached to county bonds to be deposited must
 282-6   have the word "nonnegotiable" written on the coupons.
 282-7         (e)  After deposit of the county bonds:
 282-8               (1)  the sinking fund associated with the bonds of the
 282-9   precinct or district shall be transferred to the sinking fund
282-10   account of the county; and
282-11               (2)  the commissioners court may not impose the tax
282-12   approved at the election of the precinct or district authorizing
282-13   the bonds.
282-14         (f)  The commissioners court shall pay annually the interest
282-15   on the county bonds deposited under this section from taxes imposed
282-16   to pay interest on the county bonds and detach the coupon used for
282-17   payment.  The payment shall be credited to the interest account of
282-18   the precinct or district, and the court shall use that money to pay
282-19   the interest on the outstanding bonds of the precinct or district.
282-20         (g)  From the taxes imposed to provide the sinking fund for
282-21   the county bonds, the commissioners court shall set aside annually
282-22   in the sinking fund the amount necessary for the retirement of the
282-23   county bonds.  On maturity of the county bonds, the court shall pay
282-24   the bonds in full.  The payment shall be credited to the sinking
282-25   fund of the precinct or district, and the court shall use that
282-26   money to pay in full all outstanding bonds of the precinct or
282-27   district.  (V.A.C.S. Art. 726, Secs. 3.001(d) (part), (e) (part),
 283-1   3.002(c).)
 283-2         Sec. 1471.085.  TERMS AND FORM OF COMPENSATION BONDS; USE OF
 283-3   SURPLUS BONDS.  (a)  County bonds issued for a purpose described by
 283-4   Section 1471.081(c) or (d) shall:
 283-5               (1)  be issued in similar denominations, bear the same
 283-6   rate of interest, and have the same date of maturity and similar
 283-7   payment options as the outstanding bonds of the commissioners or
 283-8   justice precinct or road district; and
 283-9               (2)  in all respects be similar to the outstanding
283-10   precinct or district bonds except that the bonds:
283-11                     (A)  are county obligations instead of precinct
283-12   or district obligations; and
283-13                     (B)  shall be dated after the election at which
283-14   the county bonds were authorized.
283-15         (b)  County bonds issued in excess of the amount required to
283-16   exchange, offset, and retire the outstanding precinct or district
283-17   bonds must mature within 40 years.
283-18         (c)  The proceeds of county bonds issued in excess of the
283-19   amount required to exchange, offset, and retire the outstanding
283-20   precinct or district bonds shall be credited to the available road
283-21   fund of the county.  The commissioners court may spend the proceeds
283-22   throughout the county only:
283-23               (1)  to construct, maintain, or operate a macadamized,
283-24   graveled, or paved road or turnpike; or
283-25               (2)  in aid of a purpose described by Subdivision (1).
283-26         (d)  Except as provided by this subchapter, the issuance and
283-27   sale of bonds authorized by this subchapter and the imposition of
 284-1   taxes for the bonds shall be as required by law for other county
 284-2   bonds.  (V.A.C.S. Art. 726, Sec. 3.003 (part).)
 284-3         Sec. 1471.086.  CREATION OF ROAD DISTRICT CONTAINING ENTIRE
 284-4   TERRITORY OF EXISTING DISTRICT.  (a)  If a road district is created
 284-5   that contains all of the territory of an existing commissioners or
 284-6   justice precinct or road district that has outstanding road bonds,
 284-7   the newly created district:
 284-8               (1)  shall fully compensate the existing precinct or
 284-9   district in an amount equal to the amount of outstanding road
284-10   bonds; and
284-11               (2)  may issue bonds to:
284-12                     (A)  purchase or construct roads in the existing
284-13   precinct or district;
284-14                     (B)  further construct, maintain, or operate
284-15   macadamized, graveled, or paved roads or turnpikes in the new
284-16   district; or
284-17                     (C)  aid in a purpose described by Paragraph (A)
284-18   or (B).
284-19         (b)  The compensation shall be made and the bonds issued in
284-20   the form and manner for county bonds under Sections
284-21   1471.081-1471.085 except that the petition must be signed by 50 or
284-22   a majority of the registered voters of the new district.  (V.A.C.S.
284-23   Art. 726, Sec. 3.004.)
284-24         Sec. 1471.087.  CREATION OF ROAD DISTRICT CONTAINING PORTION
284-25   OF TERRITORY OF EXISTING DISTRICT.  (a)  If a road district is
284-26   created that contains a portion of the territory of an existing
284-27   precinct or district that has outstanding road bonds, the newly
 285-1   created district may issue bonds to:
 285-2               (1)  purchase roads in the existing precinct or
 285-3   district; or
 285-4               (2)  further construct macadamized, graveled, or paved
 285-5   roads or turnpikes in the new district.
 285-6         (b)  The bonds shall be issued in the form and manner
 285-7   prescribed for county bonds under Sections 1471.081-1471.086.
 285-8   (V.A.C.S. Art. 726, Sec. 3.005 (part).)
 285-9         CHAPTER 1472.  REFUNDING OF COUNTY BONDS FOR CAUSEWAYS
285-10   Sec. 1472.001.  APPLICABILITY OF CHAPTER
285-11   Sec. 1472.002.  AUTHORITY TO ISSUE REFUNDING BONDS
285-12   Sec. 1472.003.  MATURITY
285-13   Sec. 1472.004.  SALE OF BONDS
285-14   Sec. 1472.005.  EXCHANGE OR REPAYMENT OF BONDS BEING REFUNDED
285-15   Sec. 1472.006.  USE OF FUNDS ESTABLISHED FOR BONDS BEING
285-16                     REFUNDED
285-17   Sec. 1472.007.  CONTINUED IMPOSITION OF TAXES
285-18   Sec. 1472.008.  REFUNDING OF REFUNDING BONDS
285-19         CHAPTER 1472.  REFUNDING OF COUNTY BONDS FOR CAUSEWAYS
285-20         Sec. 1472.001.  APPLICABILITY OF CHAPTER.  This chapter
285-21   applies only to a county that has outstanding bonds:
285-22               (1)  issued to construct, acquire, improve, operate, or
285-23   maintain a causeway; and
285-24               (2)  the principal of and interest on which are payable
285-25   from revenue derived from the operation of the causeway.  (V.A.C.S.
285-26   Art. 795a, Sec. 1 (part).)
285-27         Sec. 1472.002.  AUTHORITY TO ISSUE REFUNDING BONDS.  (a)  The
 286-1   commissioners court of the county may issue bonds to refund the
 286-2   outstanding bonds described by Section 1472.001 and may impose ad
 286-3   valorem taxes to pay the interest on and to provide a sinking fund
 286-4   for the redemption of the refunding bonds only if the issuance of
 286-5   the bonds is approved by a majority of the qualified voters voting
 286-6   at an election held in the county in the manner provided by Chapter
 286-7   1251.
 286-8         (b)  The aggregate principal amount of outstanding refunding
 286-9   bonds issued under this section may not exceed an amount that, for
286-10   the payment of the principal of and interest on the bonds, would
286-11   require the county to impose ad valorem taxes at a rate greater
286-12   than the 80-cent limitation established by Section 9, Article VIII,
286-13   Texas Constitution.  (V.A.C.S.  Art. 795a, Secs. 1 (part), 2.)
286-14         Sec. 1472.003.  MATURITY.  A bond issued under this chapter
286-15   must mature not later than 40 years after its date.  (V.A.C.S.
286-16   Art. 795a, Sec. 3 (part).)
286-17         Sec. 1472.004.  SALE OF BONDS.  The commissioners court may
286-18   determine the manner of sale of bonds issued under this chapter.
286-19   (V.A.C.S. Art. 795a, Sec. 3 (part).)
286-20         Sec. 1472.005.  EXCHANGE OR REPAYMENT OF BONDS BEING
286-21   REFUNDED.  The commissioners court may:
286-22               (1)  exchange bonds issued under this chapter for the
286-23   bonds being refunded; or
286-24               (2)  use the proceeds of bonds issued under this
286-25   chapter to pay the principal amount of the bonds being refunded and
286-26   any required redemption premium and cancel those bonds.  (V.A.C.S.
286-27   Art. 795a, Secs. 3 (part), 5 (part).)
 287-1         Sec. 1472.006.  USE OF FUNDS ESTABLISHED FOR BONDS BEING
 287-2   REFUNDED.  On cancellation of the bonds being refunded, the
 287-3   commissioners court may use money in any fund established by the
 287-4   resolution or order authorizing the issuance of the bonds to be
 287-5   refunded:
 287-6               (1)  to pay the principal of and accrued interest on
 287-7   the bonds to be refunded;
 287-8               (2)  to pay any required redemption premium;
 287-9               (3)  to make a payment into the road and bridge fund of
287-10   the county; or
287-11               (4)  for any other lawful purpose.  (V.A.C.S.
287-12   Art. 795a, Sec.  3 (part).)
287-13         Sec. 1472.007.  CONTINUED IMPOSITION OF TAXES.  A county
287-14   issuing bonds under this chapter shall continue to impose ad
287-15   valorem taxes to pay the interest on those bonds and to provide a
287-16   sinking fund for the redemption of those bonds even if the
287-17   facilities constructed with the proceeds of the bonds being
287-18   refunded become a part of the state highway system.  (V.A.C.S.
287-19   Art. 795a, Sec. 4.)
287-20         Sec. 1472.008.  REFUNDING OF REFUNDING BONDS.  Subject to
287-21   Section 1472.002(b), the commissioners court may refund bonds
287-22   issued under this chapter on the terms, including the maturity, as
287-23   determined by the court.  (V.A.C.S. Art. 795a, Sec. 5 (part).)
287-24             CHAPTER 1473.  OBLIGATIONS FOR COUNTY BUILDINGS
287-25                SUBCHAPTER A.  BONDS FOR PUBLIC LIBRARIES
287-26   Sec. 1473.001.  AUTHORITY TO ISSUE PUBLIC LIBRARY BONDS
287-27   Sec. 1473.002.  PLEDGE OF REVENUE
 288-1   Sec. 1473.003.  BONDS NOT PAYABLE FROM TAXES
 288-2   Sec. 1473.004.  CONTENTS OF ORDER AUTHORIZING BONDS
 288-3   Sec. 1473.005.  ADOPTION AND EXECUTION OF DOCUMENTS
 288-4   Sec. 1473.006.  MATURITY
 288-5   Sec. 1473.007.  OPERATING AND LEASING CHARGES
 288-6   Sec. 1473.008.  REFUNDING BONDS
 288-7   Sec. 1473.009.  EXEMPTION FROM TAXATION
 288-8           (Sections 1473.010-1473.020 reserved for expansion)
 288-9            SUBCHAPTER B.  BONDS FOR AUDITORIUMS, COLISEUMS,
288-10                          AND EXHIBIT BUILDINGS
288-11   Sec. 1473.021.  AUTHORITY FOR AUDITORIUM, COLISEUM, OR
288-12                     EXHIBIT BUILDING
288-13   Sec. 1473.022.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX
288-14   Sec. 1473.023.  PAYMENT FOR BUILDINGS OR IMPROVEMENTS
288-15   Sec. 1473.024.  LOCATION OF BUILDINGS OR IMPROVEMENTS
288-16           (Sections 1473.025-1473.050 reserved for expansion)
288-17             SUBCHAPTER C.  SECURITIES TO IMPROVE OR REPAIR
288-18                            CERTAIN BUILDINGS
288-19   Sec. 1473.051.  DEFINITION
288-20   Sec. 1473.052.  AUTHORITY TO ISSUE OBLIGATIONS
288-21   Sec. 1473.053.  OBLIGATIONS NOT PAYABLE FROM TAXES
288-22   Sec. 1473.054.  RENT
288-23   Sec. 1473.055.  LIENS ON AND USE OF REVENUE FROM BUILDING
288-24   Sec. 1473.056.  ELECTION NOT REQUIRED
288-25           (Sections 1473.057-1473.100 reserved for expansion)
288-26            SUBCHAPTER D.  BONDS FOR JAILS OR OTHER BUILDINGS
288-27   Sec. 1473.101.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX
 289-1   Sec. 1473.102.  ELECTION PROPOSITIONS
 289-2           (Sections 1473.103-1473.130 reserved for expansion)
 289-3               SUBCHAPTER E.  BONDS FOR PARKING FACILITIES
 289-4   Sec. 1473.131.  DEFINITIONS
 289-5   Sec. 1473.132.  AUTHORITY FOR PARKING FACILITIES
 289-6   Sec. 1473.133.  OTHER FACILITIES WITHIN PARKING
 289-7                     FACILITY
 289-8   Sec. 1473.134.  LEASE OF PARKING FACILITY
 289-9   Sec. 1473.135.  AUTHORITY TO ISSUE BONDS
289-10   Sec. 1473.136.  PLEDGE OF REVENUE; TAX
289-11   Sec. 1473.137.  BONDS NOT PAYABLE FROM TAXES
289-12   Sec. 1473.138.  MATURITY
289-13   Sec. 1473.139.  SIGNATURES; REGISTRATION BY COUNTY TREASURER
289-14   Sec. 1473.140.  ADDITIONAL BONDS
289-15   Sec. 1473.141.  SALE OF BONDS
289-16   Sec. 1473.142.  USE OF BOND PROCEEDS
289-17   Sec. 1473.143.  RENTS AND RATES FOR SERVICES
289-18   Sec. 1473.144.  REFUNDING BONDS
289-19   Sec. 1473.145.  PROVISIONS FOR OPERATION OF PARKING
289-20                     FACILITY
289-21   Sec. 1473.146.  ELECTION NOT REQUIRED
289-22           (Sections 1473.147-1473.170 reserved for expansion)
289-23          SUBCHAPTER F.  BONDS FOR PUBLIC HEALTH ADMINISTRATION
289-24                      BUILDINGS IN CERTAIN COUNTIES
289-25   Sec. 1473.171.  APPLICABILITY OF SUBCHAPTER
289-26   Sec. 1473.172.  AUTHORITY FOR PUBLIC HEALTH ADMINISTRATION
289-27                     BUILDING
 290-1   Sec. 1473.173.  AUTHORITY TO ISSUE BONDS
 290-2   Sec. 1473.174.  COST SHARING AND INTEREST IN JOINT PROJECTS
 290-3   Sec. 1473.175.  USE OF JOINT PROJECT BUILDING
 290-4           (Sections 1473.176-1473.190 reserved for expansion)
 290-5    SUBCHAPTER G.  BONDS FOR WORKHOUSES AND FARMS IN COUNTIES WITH A
 290-6                     POPULATION OF MORE THAN 900,000
 290-7   Sec. 1473.191.  APPLICABILITY OF SUBCHAPTER
 290-8   Sec. 1473.192.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX
 290-9   Sec. 1473.193.  ELECTION
290-10   Sec. 1473.194.  ELECTION PROPOSITION
290-11   Sec. 1473.195.  NOTICE OF ELECTION
290-12           (Sections 1473.196-1473.230 reserved for expansion)
290-13     SUBCHAPTER H.  CERTIFICATES OF INDEBTEDNESS FOR CRIME DETECTION
290-14       FACILITIES IN COUNTIES WITH POPULATION OF MORE THAN 900,000
290-15   Sec. 1473.231.  APPLICABILITY OF SUBCHAPTER
290-16   Sec. 1473.232.  AUTHORITY TO OPERATE CRIME DETECTION
290-17                     FACILITIES; FEES, CHARGES, AND EXPENSES
290-18   Sec. 1473.233.  AUTHORITY TO ISSUE CERTIFICATES OF
290-19                     INDEBTEDNESS AND IMPOSE TAX
290-20   Sec. 1473.234.  MATURITY
290-21   Sec. 1473.235.  ELECTION NOT REQUIRED
290-22   Sec. 1473.236.  LIMIT ON AMOUNT OF CERTIFICATES
290-23           (Sections 1473.237-1473.260 reserved for expansion)
290-24   SUBCHAPTER I.  BONDS FOR AUDITORIUM OR COLISEUM PARKING FACILITIES
290-25          IN COUNTIES WITH POPULATION OF MORE THAN ONE MILLION
290-26   Sec. 1473.261.  APPLICABILITY OF SUBCHAPTER
290-27   Sec. 1473.262.  DEFINITIONS
 291-1   Sec. 1473.263.  AUTHORITY FOR PARKING FACILITY
 291-2   Sec. 1473.264.  LEASE OF PARKING FACILITY
 291-3   Sec. 1473.265.  AUTHORITY TO ISSUE REVENUE BONDS
 291-4   Sec. 1473.266.  PLEDGE OF REVENUE
 291-5   Sec. 1473.267.  BONDS NOT PAYABLE FROM TAXES
 291-6   Sec. 1473.268.  MATURITY
 291-7   Sec. 1473.269.  SIGNATURES; REGISTRATION BY COUNTY
 291-8                     TREASURER
 291-9   Sec. 1473.270.  ADDITIONAL BONDS
291-10   Sec. 1473.271.  SALE OF BONDS
291-11   Sec. 1473.272.  USE OF BOND PROCEEDS
291-12   Sec. 1473.273.  RENTS AND RATES FOR SERVICES
291-13   Sec. 1473.274.  REFUNDING BONDS
291-14   Sec. 1473.275.  PROVISIONS FOR OPERATION OF PARKING
291-15                     FACILITY
291-16   Sec. 1473.276.  ELECTION NOT REQUIRED
291-17             CHAPTER 1473.  OBLIGATIONS FOR COUNTY BUILDINGS
291-18                SUBCHAPTER A.  BONDS FOR PUBLIC LIBRARIES
291-19         Sec. 1473.001.  AUTHORITY TO ISSUE PUBLIC LIBRARY BONDS.  The
291-20   commissioners court of a county by order may authorize the issuance
291-21   of county bonds to finance all or part of the acquisition,
291-22   construction, improvement, enlargement, equipment, or repair of a
291-23   public library building.  (V.A.C.S. Art. 1696b, Sec. 1.)
291-24         Sec. 1473.002.  PLEDGE OF REVENUE.  The commissioners court
291-25   shall provide for the payment of the principal of and interest on
291-26   bonds issued under this subchapter by pledging all or part of the
291-27   revenue derived from:
 292-1               (1)  the operation of the library building; or
 292-2               (2)  the lease of space in the library building.
 292-3   (V.A.C.S. Art. 1696b, Sec. 2(a).)
 292-4         Sec. 1473.003.  BONDS NOT PAYABLE FROM TAXES.  An owner of a
 292-5   bond issued under this subchapter is not entitled to demand payment
 292-6   of the principal of or interest on the bond from money raised by
 292-7   taxation.  (V.A.C.S. Art. 1696b, Sec. 2(c).)
 292-8         Sec. 1473.004.  CONTENTS OF ORDER AUTHORIZING BONDS.  (a)
 292-9   The order of the commissioners court authorizing the issuance of
292-10   bonds under this subchapter may provide for the flow of funds and
292-11   the establishment and maintenance of an interest and sinking fund,
292-12   a reserve fund, or another fund.
292-13         (b)  The order may:
292-14               (1)  prohibit the issuance of additional bonds or other
292-15   obligations payable from the pledged revenue; or
292-16               (2)  reserve the right of the commissioners court to
292-17   issue additional bonds payable from the pledged revenue that are on
292-18   a parity with or subordinate to the lien and pledge on the revenue
292-19   that supports the bonds issued under the order.
292-20         (c)  The commissioners court may include in the order any
292-21   other provision or covenant, including a covenant with respect to
292-22   the bonds, the pledge of revenue, or the operation or maintenance
292-23   of the library building.  (V.A.C.S. Art. 1696b, Secs. 4(a), (b),
292-24   (c).)
292-25         Sec. 1473.005.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
292-26   commissioners court may adopt and have executed any other
292-27   proceeding or instrument necessary or convenient to the issuance of
 293-1   the bonds.  (V.A.C.S. Art. 1696b, Sec. 4(d).)
 293-2         Sec. 1473.006.  MATURITY.  A bond issued under this
 293-3   subchapter must mature not later than 40 years after its date.
 293-4   (V.A.C.S.  Art. 1696b, Secs. 3(b) (part), 6(b) (part).)
 293-5         Sec. 1473.007.  OPERATING AND LEASING CHARGES.  (a)  The
 293-6   commissioners court shall:
 293-7               (1)  establish fees related to the operation of the
 293-8   library building; and
 293-9               (2)  charge rent for the lease of space in the library
293-10   building.
293-11         (b)  The court shall establish the fees and rents in amounts
293-12   to provide revenue sufficient to pay all expenses related to the
293-13   ownership and operation of the library building, including:
293-14               (1)  payment of the principal of and interest on bonds
293-15   issued under this subchapter; and
293-16               (2)  the creation and maintenance of any required bond
293-17   reserve fund.  (V.A.C.S. Art. 1696b, Sec. 2(b).)
293-18         Sec. 1473.008.  REFUNDING BONDS.  (a)  A county may issue
293-19   refunding bonds to refund all or any part of its outstanding bonds
293-20   issued under this subchapter, including matured but unpaid interest
293-21   coupons. The comptroller shall register the refunding bonds on the
293-22   surrender and cancellation of the bonds being refunded. The
293-23   refunding may take place in one delivery or in installment
293-24   deliveries.
293-25         (b)  The refunding bonds may be payable from the same sources
293-26   as the bonds to be refunded or from other additional sources.
293-27         (c)  A county may, in the order authorizing the issuance of
 294-1   the refunding bonds, provide for the sale of the refunding bonds
 294-2   and the deposit of the proceeds in the place at which the bonds to
 294-3   be refunded are payable. In that case, the refunding bonds may be
 294-4   issued before the cancellation of the bonds to be refunded.
 294-5         (d)  If refunding bonds are issued before cancellation of the
 294-6   bonds to be refunded, the county shall deposit an amount sufficient
 294-7   to pay the principal of and interest on the bonds to be refunded to
 294-8   their maturity dates, or to their option dates if the bonds have
 294-9   been called for payment before maturity according to their terms,
294-10   in each place at which the bonds to be refunded are payable.  The
294-11   comptroller shall register the refunding bonds without the
294-12   surrender and cancellation of bonds to be refunded.  (V.A.C.S.
294-13   Art. 1696b, Secs. 6(a), (c), (d) (part), (e), (f) (part).)
294-14         Sec. 1473.009.  EXEMPTION FROM TAXATION.  A bond issued under
294-15   this subchapter, any transaction related to the bond, and profits
294-16   made in the sale of the bond are exempt from taxation by this state
294-17   or by a municipality or other political subdivision of this state.
294-18   (V.A.C.S. Art. 1696b, Sec. 9.)
294-19           (Sections 1473.010-1473.020 reserved for expansion)
294-20            SUBCHAPTER B.  BONDS FOR AUDITORIUMS, COLISEUMS,
294-21                          AND EXHIBIT BUILDINGS
294-22         Sec. 1473.021.  AUTHORITY FOR AUDITORIUM, COLISEUM, OR
294-23   EXHIBIT BUILDING.  The commissioners court of a county may purchase
294-24   or construct a building or other permanent improvement to be used
294-25   for:
294-26               (1)  a coliseum;
294-27               (2)  an auditorium; or
 295-1               (3)  an annual exhibit of livestock or agricultural,
 295-2   horticultural, or mineral products of the county.  (V.A.C.S.
 295-3   Art. 2372d-2, Sec. 1 (part).)
 295-4         Sec. 1473.022.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX.
 295-5   (a)  The commissioners court of a county may:
 295-6               (1)  issue bonds to finance the purchase or
 295-7   construction of a building or improvement described by Section
 295-8   1473.021; and
 295-9               (2)  impose a tax to pay the bonds.
295-10         (b)  The commissioners court shall issue any bonds under this
295-11   subchapter and impose the tax in compliance with the applicable
295-12   provisions of Subtitles A and C.  (V.A.C.S. Art. 2372d-2, Sec. 2.)
295-13         Sec. 1473.023.  PAYMENT FOR BUILDINGS OR IMPROVEMENTS.  A
295-14   county that maintains a permanent improvement fund shall pay for
295-15   each building or improvement described by Section 1473.021 from
295-16   that fund.  (V.A.C.S. Art. 2372d-2, Sec. 1 (part).)
295-17         Sec. 1473.024.  LOCATION OF BUILDINGS OR IMPROVEMENTS.  The
295-18   commissioners court may determine the location in the county for a
295-19   building or improvement described by Section 1473.021.  (V.A.C.S.
295-20   Art. 2372d-2, Sec. 1 (part).)
295-21           (Sections 1473.025-1473.050 reserved for expansion)
295-22             SUBCHAPTER C.  SECURITIES TO IMPROVE OR REPAIR
295-23                            CERTAIN BUILDINGS
295-24         Sec. 1473.051.  DEFINITION.  In this subchapter, "security"
295-25   means a bond, note, warrant, obligation, or other evidence of
295-26   indebtedness.  (New.)
295-27         Sec. 1473.052.  AUTHORITY TO ISSUE OBLIGATIONS.  (a)  The
 296-1   commissioners court of a county may issue securities to finance the
 296-2   enlargement, alteration, improvement, or repair of a building if:
 296-3               (1)  the building:
 296-4                     (A)  is not the courthouse;
 296-5                     (B)  is located at the county seat;
 296-6                     (C)  is partly used for public business and
 296-7   partly rented for private use; and
 296-8                     (D)  was acquired by the county in settlement of
 296-9   an obligation owed the county; and
296-10               (2)  money is not available for the enlargement,
296-11   alteration, improvement, or repair.
296-12         (b)  In issuing a security under this subchapter, the
296-13   commissioners court may pledge, assign, or encumber the net income
296-14   and revenue from that part of the building that the court finds is
296-15   not, and will not later be, necessary for a public purpose.
296-16         (c)  In issuing a security under this subchapter, the
296-17   commissioners court must comply with Chapter 1253, except as this
296-18   subchapter otherwise provides.  (V.A.C.S. Art. 2370, Secs. 2
296-19   (part), 4 (part).)
296-20         Sec. 1473.053.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  A
296-21   security issued under this subchapter:
296-22               (1)  is not a debt of the county;
296-23               (2)  may be a charge only on the revenue that is
296-24   pledged, assigned, or encumbered; and
296-25               (3)  may not be included in determining the power of
296-26   the county to issue bonds for any purpose authorized by law.
296-27         (b)  Each security issued under this subchapter must include
 297-1   the following provision:  "The holder of this obligation is not
 297-2   entitled to demand payment of this obligation out of any money
 297-3   raised by taxation."  (V.A.C.S. Art. 2370, Secs. 2 (part), 4
 297-4   (part).)
 297-5         Sec. 1473.054.  RENT.  For each part of a building described
 297-6   by Section 1473.052(a) that is not used for a public purpose, the
 297-7   county shall charge and collect rent in an amount sufficient to:
 297-8               (1)  pay all operating, maintenance, depreciation,
 297-9   replacement, improvement, and interest charges and expenses for the
297-10   building; and
297-11               (2)  create an interest and sinking fund sufficient to
297-12   pay any securities issued under this subchapter.  (V.A.C.S.
297-13   Art. 2370, Sec. 3 (part).)
297-14         Sec. 1473.055.  LIENS ON AND USE OF REVENUE FROM BUILDING.
297-15   (a)  Except as provided by Subsections (b) and (c), the income or
297-16   revenue of a building described by Section 1473.052(a) may not be
297-17   used to pay another debt, expense, or obligation of the county
297-18   until the securities secured by the revenue have been finally paid.
297-19         (b)  Each expense of operation and maintenance, including all
297-20   salaries, labor, materials, interest, improvements, repairs, and
297-21   extensions necessary to provide efficient service, and each proper
297-22   item of expense, is a first lien against the building's revenue.
297-23         (c)  An expense for a repair or extension is a first lien
297-24   only if the commissioners court finds the repair or extension is
297-25   necessary to:
297-26               (1)  keep the building in operation and provide
297-27   adequate service; or
 298-1               (2)  respond to a physical accident or condition that
 298-2   would otherwise impair a security issued under this subchapter.
 298-3   (V.A.C.S. Art. 2370, Sec. 3 (part).)
 298-4         Sec. 1473.056.  ELECTION NOT REQUIRED.  The commissioners
 298-5   court may issue securities under this subchapter without holding an
 298-6   election to approve the issuance.  (V.A.C.S. Art. 2370, Sec. 4
 298-7   (part).)
 298-8           (Sections 1473.057-1473.100 reserved for expansion)
 298-9            SUBCHAPTER D.  BONDS FOR JAILS OR OTHER BUILDINGS
298-10         Sec. 1473.101.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX.  (a)
298-11   The commissioners court of a county may:
298-12               (1)  issue bonds to pay for the purchase, construction,
298-13   improvement, or equipment of a building or jail under Section
298-14   292.001, Local Government Code, including the purchase or
298-15   improvement of a site for the building or jail; and
298-16               (2)  impose a tax under Section 9, Article VIII, Texas
298-17   Constitution, to pay for the bonds.
298-18         (b)  The commissioners court of a county that has a
298-19   population of more than 900,000 may:
298-20               (1)  issue bonds to pay for the construction and
298-21   equipment of a courthouse or county branch office building,
298-22   including the acquisition of a site for the courthouse or branch
298-23   office building; and
298-24               (2)  impose a tax to pay for the bonds.
298-25         (c)  Except as otherwise provided by this subchapter, the
298-26   commissioners court shall issue any bonds and impose the tax in
298-27   compliance with the applicable provisions of Subtitles A and C.
 299-1   (V.A.C.S.  Arts. 725b (part); 2370b, Sec. 3 (part).)
 299-2         Sec. 1473.102.  ELECTION PROPOSITIONS.  The commissioners
 299-3   court may submit one or more bond propositions at an election
 299-4   relating to the issuance of bonds under this subchapter.  Each
 299-5   proposition may include one or more of the purposes provided by
 299-6   Section 1473.101.  (V.A.C.S. Arts. 725b (part); 2370b, Sec. 4.)
 299-7           (Sections 1473.103-1473.130 reserved for expansion)
 299-8               SUBCHAPTER E.  BONDS FOR PARKING FACILITIES
 299-9         Sec. 1473.131.  DEFINITIONS.  In this subchapter:
299-10               (1)  "Bond order" means an order authorizing the
299-11   issuance of bonds under this subchapter.
299-12               (2)  "Parking facility" means:
299-13                     (A)  a lot, area, or structure used primarily to
299-14   park motor vehicles;
299-15                     (B)  the site for the lot, area, or structure;
299-16   and
299-17                     (C)  equipment used in connection with the
299-18   maintenance and operation of the lot, area, or structure.
299-19               (3)  "Trust indenture" means an instrument, including a
299-20   mortgage or deed of trust, that secures bonds issued under this
299-21   subchapter by:
299-22                     (A)  a pledge of revenue; or
299-23                     (B)  a pledge of revenue and a mortgage lien on
299-24   property.  (V.A.C.S. Art. 2372s, Sec. 2 (part).)
299-25         Sec. 1473.132.  AUTHORITY FOR PARKING FACILITIES.  The
299-26   commissioners court of a county may construct, enlarge, furnish,
299-27   equip, or operate a parking facility in the vicinity of any
 300-1   county-owned facility or building if the court finds the action to
 300-2   be in the best interest of the county and the county's residents.
 300-3   (V.A.C.S. Art. 2372s, Sec. 1 (part).)
 300-4         Sec. 1473.133.  OTHER FACILITIES WITHIN PARKING FACILITY.
 300-5   The commissioners court may incorporate into a parking facility
 300-6   authorized by Section 1473.132:
 300-7               (1)  a jury assembly room;
 300-8               (2)  office space;
 300-9               (3)  a nursery;
300-10               (4)  toilet facilities;
300-11               (5)  a snack bar; or
300-12               (6)  a related facility.  (V.A.C.S. Art. 2372s, Sec. 1
300-13   (part).)
300-14         Sec. 1473.134.  LEASE OF PARKING FACILITY.  The commissioners
300-15   court may lease the parking facility to any person or corporation.
300-16   (V.A.C.S. Art. 2372s, Sec. 1 (part).)
300-17         Sec. 1473.135.  AUTHORITY TO ISSUE BONDS.  The commissioners
300-18   court by order may issue bonds to provide money to construct,
300-19   enlarge, furnish, or equip a parking facility authorized by this
300-20   subchapter.  (V.A.C.S. Art. 2372s, Secs. 3 (part), 4 (part).)
300-21         Sec. 1473.136.  PLEDGE OF REVENUE; TAX.  (a)  Bonds issued
300-22   under this subchapter must be payable from and secured by a pledge
300-23   of:
300-24               (1)  the net revenue of the parking facility; and
300-25               (2)  any other revenue incident to the ownership of the
300-26   parking facility, including money received from a lease of the
300-27   facility.
 301-1         (b)  The commissioners court may also provide for the bonds
 301-2   to be payable from and secured by the imposition of an ad valorem
 301-3   tax.  The tax may not exceed two and one-half cents on each $100
 301-4   valuation of taxable property in the county.  (V.A.C.S. Art. 2372s,
 301-5   Sec. 3 (part).)
 301-6         Sec. 1473.137.  BONDS NOT PAYABLE FROM TAXES.  (a)  Except as
 301-7   provided by Subsection (b), each bond issued under this subchapter
 301-8   must include the following provision:  "The holder of this
 301-9   obligation is not entitled to demand payment of this obligation
301-10   from money raised by taxation."
301-11         (b)  A bond may not contain the provision specified by
301-12   Subsection (a) if the commissioners court has provided for the
301-13   payment of the bond from tax revenue under Section 1473.136(b).
301-14   (V.A.C.S. Art. 2372s, Secs. 3 (part), 8 (part).)
301-15         Sec. 1473.138.  MATURITY.  A bond issued under this
301-16   subchapter must mature within 40 years.  (V.A.C.S. Art. 2372s, Sec.
301-17   4 (part).)
301-18         Sec. 1473.139.  SIGNATURES; REGISTRATION BY COUNTY TREASURER.
301-19   A bond issued under this subchapter must be:
301-20               (1)  signed by the county judge;
301-21               (2)  countersigned by the county clerk; and
301-22               (3)  registered by the county treasurer.  (V.A.C.S.
301-23   Art. 2372s, Sec. 4 (part).)
301-24         Sec. 1473.140.  ADDITIONAL BONDS.  (a)  The commissioners
301-25   court may issue bonds under this subchapter that are a junior lien
301-26   on the net revenue or property unless the bond order or trust
301-27   indenture prohibits their issuance.
 302-1         (b)  The commissioners court may issue parity bonds under
 302-2   conditions in the bond order or trust indenture.  (V.A.C.S.
 302-3   Art. 2372s, Sec. 5.)
 302-4         Sec. 1473.141.  SALE OF BONDS.  The county may sell the bonds
 302-5   under terms the commissioners court determines to be the most
 302-6   advantageous and reasonably obtainable.  (V.A.C.S. Art. 2372s, Sec.
 302-7   4 (part).)
 302-8         Sec. 1473.142.  USE OF BOND PROCEEDS.  The commissioners
 302-9   court may set aside from the bond proceeds:
302-10               (1)  money to pay interest on the bonds; and
302-11               (2)  money in the amount the commissioners court
302-12   estimates to be required for operating expenses until the parking
302-13   facility becomes sufficiently operational.  (V.A.C.S. Art. 2372s,
302-14   Sec. 6.)
302-15         Sec. 1473.143.  RENTS AND RATES FOR SERVICES.  The
302-16   commissioners court shall charge rents or rates for services of the
302-17   parking facility and shall use any other revenue generated by the
302-18   parking facility so that the revenues of the facility are
302-19   sufficient to:
302-20               (1)  pay the expenses of owning, operating, and
302-21   maintaining the facility;
302-22               (2)  pay when due the principal of and interest on the
302-23   bonds; and
302-24               (3)  create and maintain a bond reserve fund and other
302-25   funds as provided by the bond order or trust indenture.  (V.A.C.S.
302-26   Art. 2372s, Sec. 9 (part).)
302-27         Sec. 1473.144.  REFUNDING BONDS.  (a)  The commissioners
 303-1   court may issue bonds to refund outstanding bonds issued under this
 303-2   subchapter.
 303-3         (b)  The refunding bonds may be issued in the manner provided
 303-4   by this subchapter for other bonds.
 303-5         (c)  The refunding bonds may be issued to be exchanged by the
 303-6   comptroller or to be sold, with the bond proceeds applied to the
 303-7   payment of outstanding bonds.  (V.A.C.S. Art. 2372s, Sec. 7.)
 303-8         Sec. 1473.145.  PROVISIONS FOR OPERATION OF PARKING FACILITY.
 303-9   The bond order or trust indenture may prescribe systems, methods,
303-10   routines, or procedures for the operation of the parking facility.
303-11   (V.A.C.S. Art. 2372s, Sec. 9 (part).)
303-12         Sec. 1473.146.  ELECTION NOT REQUIRED.  The commissioners
303-13   court may issue bonds under this subchapter without holding an
303-14   election to approve the issuance.  (V.A.C.S. Art. 2372s, Sec. 4
303-15   (part).)
303-16           (Sections 1473.147-1473.170 reserved for expansion)
303-17          SUBCHAPTER F.  BONDS FOR PUBLIC HEALTH ADMINISTRATION
303-18                      BUILDINGS IN CERTAIN COUNTIES
303-19         Sec. 1473.171.  APPLICABILITY OF SUBCHAPTER.  This subchapter
303-20   applies only to a county that:
303-21               (1)  contains a municipality with a population of more
303-22   than 275,000; and
303-23               (2)  before April 27, 1965, ordered an election for the
303-24   issuance of bonds for:
303-25                     (A)  erecting a public health administration
303-26   building; and
303-27                     (B)  acquiring a site and equipment for a public
 304-1   health administration building.  (V.A.C.S. Art. 2370d, Secs. 1, 2
 304-2   (part).)
 304-3         Sec. 1473.172.  AUTHORITY FOR PUBLIC HEALTH ADMINISTRATION
 304-4   BUILDING.  If the bonds were approved at an election ordered before
 304-5   April 27, 1965, the county alone or jointly with a municipality
 304-6   located in the county, may:
 304-7               (1)  erect, maintain, expand, or repair a public health
 304-8   administration building; or
 304-9               (2)  acquire a site or equipment for a public health
304-10   administration building.  (V.A.C.S. Art. 2370d, Sec. 3 (part).)
304-11         Sec. 1473.173.  AUTHORITY TO ISSUE BONDS.  (a)  If the bonds
304-12   were approved at an election ordered before April 27, 1965, the
304-13   county may issue general obligation bonds to finance:
304-14               (1)  the erection, maintenance, expansion, and repair
304-15   of a building authorized by Section 1473.172; and
304-16               (2)  the acquisition of a site and equipment for the
304-17   building.
304-18         (b)  The commissioners court shall issue any bonds under this
304-19   subchapter in compliance with the applicable provisions of
304-20   Subtitles A and C.  (V.A.C.S. Art. 2370d, Sec. 3 (part).)
304-21         Sec. 1473.174.  COST SHARING AND INTEREST IN JOINT PROJECTS.
304-22   A county and a municipality that jointly erect a public health
304-23   administration building under this subchapter shall share the cost
304-24   of, and shall each have an undivided interest in, the building:
304-25               (1)  as agreed by the governing bodies of the county
304-26   and the municipality; and
304-27               (2)  as authorized by orders or ordinances adopted by
 305-1   the governing bodies of the county and the municipality.  (V.A.C.S.
 305-2   Art. 2370d, Sec. 3 (part).)
 305-3         Sec. 1473.175.  USE OF JOINT PROJECT BUILDING.  (a)  Except
 305-4   as provided by Subsection (b), a public health administration
 305-5   building erected jointly by a county and a municipality under this
 305-6   subchapter may be:
 305-7               (1)  used for any purpose that will contribute to the
 305-8   health of the residents of the county and municipality; and
 305-9               (2)  occupied and used by the county and municipality
305-10   jointly.
305-11         (b)  The public health administration building may not be
305-12   used for hospital purposes.  (V.A.C.S. Art. 2370d, Sec. 3 (part).)
305-13           (Sections 1473.176-1473.190 reserved for expansion)
305-14    SUBCHAPTER G.  BONDS FOR WORKHOUSES AND FARMS IN COUNTIES WITH A
305-15                     POPULATION OF MORE THAN 900,000
305-16         Sec. 1473.191.  APPLICABILITY OF SUBCHAPTER.  This subchapter
305-17   applies only to a county with a population of more than 900,000.
305-18   (V.A.C.S. Art. 2370c, Sec. 1 (part).)
305-19         Sec. 1473.192.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAX.  (a)
305-20   The commissioners court of a county may:
305-21               (1)  issue bonds to pay for the acquisition,
305-22   construction, or equipment of a county workhouse or county farm to
305-23   be used to confine or to use the labor of county prisoners,
305-24   including the acquisition of a site for the workhouse or farm; and
305-25               (2)  impose a tax to pay the bonds.
305-26         (b)  A county that maintains a permanent improvement fund
305-27   shall deposit the tax to the credit of that fund to pay for an
 306-1   action taken under Subsection (a)(1).
 306-2         (c)  The commissioners court shall issue any bonds under this
 306-3   subchapter and impose the tax in compliance with the applicable
 306-4   provisions of Subtitles A and C.  (V.A.C.S.  Art. 2370c, Sec. 1
 306-5   (part).)
 306-6         Sec. 1473.193.  ELECTION.  (a)  The commissioners court may
 306-7   issue bonds under this subchapter only if more than a majority of
 306-8   the qualified voters voting at an election held for that purpose
 306-9   approve the bonds.
306-10         (b)  Subsection (a) does not apply to refunding bonds.
306-11   (V.A.C.S. Art. 2370c, Sec. 1 (part).)
306-12         Sec. 1473.194.  ELECTION PROPOSITION.  Bonds to be issued
306-13   under this subchapter may be submitted in a single proposition at
306-14   the bond election.  (V.A.C.S. Art. 2370c, Sec. 1 (part).)
306-15         Sec. 1473.195.  NOTICE OF ELECTION.  (a)  In addition to the
306-16   notice required by Section 4.003(c), Election Code, notice of an
306-17   election under this subchapter shall be given by publication in a
306-18   newspaper of general circulation in the county.
306-19         (b)  The notice must contain a substantial copy of the
306-20   election order.
306-21         (c)  The notice must be published on the same day in each of
306-22   two consecutive weeks.  The first publication must be not later
306-23   than the 15th day before the date of the election.  (V.A.C.S.
306-24   Art. 2370c, Sec. 1 (part).)
306-25           (Sections 1473.196-1473.230 reserved for expansion)
306-26     SUBCHAPTER H.  CERTIFICATES OF INDEBTEDNESS FOR CRIME DETECTION
306-27       FACILITIES IN COUNTIES WITH POPULATION OF MORE THAN 900,000
 307-1         Sec. 1473.231.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 307-2   applies only to a county with a population of more than 900,000.
 307-3   (V.A.C.S. Art. 2370c-1, Sec. 1 (part).)
 307-4         Sec. 1473.232.  AUTHORITY TO OPERATE CRIME DETECTION
 307-5   FACILITIES; FEES, CHARGES, AND EXPENSES.  (a)  The commissioners
 307-6   court of a county may:
 307-7               (1)  operate and maintain the county's crime detection
 307-8   facilities; and
 307-9               (2)  impose and collect fees or charges for services
307-10   performed or information provided to others in the use of the
307-11   facilities.
307-12         (b)  The commissioners court shall pay the operation and
307-13   maintenance expenses of the facilities from the fees or charges or
307-14   other available county funds.  (V.A.C.S. Art. 2370c-1, Sec. 4.)
307-15         Sec. 1473.233.  AUTHORITY TO ISSUE CERTIFICATES OF
307-16   INDEBTEDNESS AND IMPOSE TAX.  (a)  The commissioners court by order
307-17   may issue certificates of indebtedness to finance the acquisition,
307-18   construction, repair, improvement, or equipment of a crime
307-19   detection facility, including the acquisition of any property in
307-20   connection with the facility.
307-21         (b)  The commissioners court annually shall impose and pledge
307-22   to the payment of the certificates an ad valorem tax sufficient to
307-23   pay when due the principal of and interest on the certificates.
307-24   (V.A.C.S. Art. 2370c-1, Sec. 1 (part).)
307-25         Sec. 1473.234.  MATURITY.  A certificate of indebtedness
307-26   issued under this subchapter must mature not later than 40 years
307-27   after its date.  (V.A.C.S. Art. 2370c-1, Sec. 1 (part).)
 308-1         Sec. 1473.235.  ELECTION NOT REQUIRED.  The commissioners
 308-2   court may issue certificates of indebtedness under this subchapter
 308-3   without holding an election to approve the issuance.  (V.A.C.S.
 308-4   Art. 2370c-1, Sec. 1 (part).)
 308-5         Sec. 1473.236.  LIMIT ON AMOUNT OF CERTIFICATES.  The
 308-6   aggregate principal amount of certificates of indebtedness issued
 308-7   under this subchapter may not exceed $1.5 million.  (V.A.C.S.
 308-8   Art. 2370c-1, Sec. 1 (part).)
 308-9           (Sections 1473.237-1473.260 reserved for expansion)
308-10   SUBCHAPTER I.  BONDS FOR AUDITORIUM OR COLISEUM PARKING FACILITIES
308-11          IN COUNTIES WITH POPULATION OF MORE THAN ONE MILLION
308-12         Sec. 1473.261.  APPLICABILITY OF SUBCHAPTER.  This subchapter
308-13   applies only to a county that:
308-14               (1)  has a population of more than one million; and
308-15               (2)  has issued bonds to construct buildings or other
308-16   permanent improvements for a coliseum or auditorium in the county.
308-17   (V.A.C.S. Art. 2372d-4, Sec. 1 (part).)
308-18         Sec. 1473.262.  DEFINITIONS.  In this subchapter:
308-19               (1)  "Bond order" means an order authorizing the
308-20   issuance of revenue bonds under this subchapter.
308-21               (2)  "Parking facility" means:
308-22                     (A)  a lot, area, or structure used to park motor
308-23   vehicles;
308-24                     (B)  the site for the lot, area, or structure;
308-25   and
308-26                     (C)  equipment used in connection with
308-27   maintenance and operation of the lot, area, or structure.
 309-1               (3)  "Trust indenture" means an instrument, including a
 309-2   mortgage or deed of trust, that secures bonds issued under this
 309-3   subchapter by:
 309-4                     (A)  a pledge of revenue; or
 309-5                     (B)  a pledge of revenue and a mortgage lien on
 309-6   property.  (V.A.C.S. Art. 2372d-4, Sec. 2 (part).)
 309-7         Sec. 1473.263.  AUTHORITY FOR PARKING FACILITY.  The
 309-8   commissioners court of the county may construct, enlarge, furnish,
 309-9   equip, and operate a parking facility in the vicinity of a coliseum
309-10   or auditorium if the court finds the action to be in the best
309-11   interest of the county and the county's residents.  (V.A.C.S.
309-12   Art. 2372d-4, Sec. 1 (part).)
309-13         Sec. 1473.264.  LEASE OF PARKING FACILITY.  The commissioners
309-14   court may lease the parking facility to any person or corporation.
309-15   (V.A.C.S. Art. 2372d-4, Sec. 1 (part).)
309-16         Sec. 1473.265.  AUTHORITY TO ISSUE REVENUE BONDS.  The
309-17   commissioners court by order or trust indenture may issue revenue
309-18   bonds to provide money to construct, enlarge, furnish, or equip a
309-19   parking facility authorized by this subchapter.  (V.A.C.S.
309-20   Art. 2372d-4, Secs. 3 (part), 4 (part).)
309-21         Sec. 1473.266.  PLEDGE OF REVENUE.  Bonds issued under this
309-22   subchapter must be payable from, and secured by a pledge of, the
309-23   net revenue of the county's operation of the parking facility.  The
309-24   bonds may be payable from any other revenue incident to the
309-25   ownership of the parking facility, including money received from a
309-26   lease of the facility.  (V.A.C.S. Art. 2372d-4, Sec. 3 (part).)
309-27         Sec. 1473.267.  BONDS NOT PAYABLE FROM TAXES.  Each bond
 310-1   issued under this subchapter must include the following provision:
 310-2   "The holder of this obligation is not entitled to demand payment of
 310-3   this obligation from money raised by taxation."  (V.A.C.S.
 310-4   Art. 2372d-4, Sec. 8 (part).)
 310-5         Sec. 1473.268.  MATURITY.  A bond issued under this
 310-6   subchapter must mature within 40 years.  (V.A.C.S. Art. 2372d-4,
 310-7   Sec. 4 (part).)
 310-8         Sec. 1473.269.  SIGNATURES; REGISTRATION BY COUNTY TREASURER.
 310-9   A bond issued under this subchapter must be:
310-10               (1)  signed by the county judge;
310-11               (2)  countersigned by the county clerk; and
310-12               (3)  registered by the county treasurer.  (V.A.C.S.
310-13   Art. 2372d-4, Sec. 4 (part).)
310-14         Sec. 1473.270.  ADDITIONAL BONDS.  (a)  The commissioners
310-15   court may issue bonds under this subchapter that are a junior lien
310-16   on the net revenue or property unless the bond order or trust
310-17   indenture prohibits their issuance.
310-18         (b)  The commissioners court may issue parity bonds under
310-19   conditions in the bond order or trust indenture.  (V.A.C.S.
310-20   Art. 2372d-4, Sec. 5.)
310-21         Sec. 1473.271.  SALE OF BONDS.  The county may sell the bonds
310-22   under terms the commissioners court determines to be the most
310-23   advantageous and reasonably obtainable.  (V.A.C.S. Art. 2372d-4,
310-24   Sec. 4 (part).)
310-25         Sec. 1473.272.  USE OF BOND PROCEEDS.  (a)  The commissioners
310-26   court may set aside from the bond proceeds:
310-27               (1)  money to pay interest on the bonds; and
 311-1               (2)  money in the amount the commissioners court
 311-2   estimates to be required for operating expenses until the parking
 311-3   facility becomes sufficiently operational.
 311-4         (b)  The commissioners court may not set aside money under
 311-5   this section in an amount that exceeds the amount of money
 311-6   necessary to cover interest and operating expenses for the
 311-7   estimated period of construction and the first two years of
 311-8   operation, less any earnings during that time.  (V.A.C.S.
 311-9   Art. 2372d-4, Sec. 6.)
311-10         Sec. 1473.273.  RENTS AND RATES FOR SERVICES.  (a)  The
311-11   commissioners court shall charge rates for services of the
311-12   facility, including rents under a lease, and shall use any other
311-13   revenue generated by the facility so that the revenues of the
311-14   facility are sufficient to:
311-15               (1)  pay the expenses of owning, operating, and
311-16   maintaining the facility;
311-17               (2)  pay the principal of and interest on the bonds
311-18   when due; and
311-19               (3)  create and maintain a bond reserve fund and other
311-20   funds as provided by the bond order or trust indenture.
311-21         (b)  The county may not provide free use of the parking
311-22   facility to any person, firm, or corporation, except that the
311-23   county and any county agency or department may make free use of the
311-24   facility after bonds issued under this subchapter have been fully
311-25   paid.
311-26         (c)  The commissioners court may provide, in an order
311-27   authorizing the bonds or in a lease of the parking facility, for
 312-1   minimum periodic payments from any county resource to the bond
 312-2   interest and sinking fund or to the lessee for county or county
 312-3   agency or department use of any part of the parking facility
 312-4   designated for county or county agency or department use.
 312-5   (V.A.C.S. Art. 2372d-4, Sec. 9 (part).)
 312-6         Sec. 1473.274.  REFUNDING BONDS.  (a)  The commissioners
 312-7   court may issue bonds to refund outstanding bonds issued under this
 312-8   subchapter.
 312-9         (b)  The refunding bonds may be issued in the manner provided
312-10   by this subchapter for other bonds.
312-11         (c)  The refunding bonds may be issued to be exchanged by the
312-12   comptroller or to be sold, with the bond proceeds applied to the
312-13   payment of outstanding bonds.  (V.A.C.S. Art. 2372d-4, Sec. 7.)
312-14         Sec. 1473.275.  PROVISIONS FOR OPERATION OF PARKING FACILITY.
312-15   The bond order or trust indenture may prescribe systems, methods,
312-16   routines, or procedures for the operation of the parking facility.
312-17   (V.A.C.S. Art. 2372d-4, Sec. 9 (part).)
312-18         Sec. 1473.276.  ELECTION NOT REQUIRED.  The commissioners
312-19   court may issue bonds under this subchapter without holding an
312-20   election to approve the issuance.  (V.A.C.S. Art. 2372d-4, Sec. 4
312-21   (part).)
312-22           CHAPTER 1474.  BONDS FOR COUNTY WATER IMPROVEMENTS
312-23     SUBCHAPTER A.  PURPOSES FOR WHICH BONDS AND NOTES MAY BE ISSUED
312-24   Sec. 1474.001.  AUTHORITY TO ISSUE BONDS FOR IRRIGATION
312-25                     PURPOSES
312-26   Sec. 1474.002.  AUTHORITY TO ISSUE ADDITIONAL BONDS FOR
312-27                     IRRIGATION PURPOSES
 313-1   Sec. 1474.003.  AUTHORITY TO ISSUE BONDS OR NOTES FOR
 313-2                     REPAIR PURPOSES
 313-3   Sec. 1474.004.  AUTHORITY TO ISSUE BONDS FOR OTHER
 313-4                     WATER-RELATED IMPROVEMENTS
 313-5           (Sections 1474.005-1474.050 reserved for expansion)
 313-6                   SUBCHAPTER B.  ELECTION PROVISIONS
 313-7   Sec. 1474.051.  BONDS FOR MORE THAN ONE PURPOSE
 313-8   Sec. 1474.052.  PETITION FOR BOND ELECTION
 313-9   Sec. 1474.053.  REQUIREMENT TO STATE CHARACTERISTICS OF
313-10                     BONDS
313-11   Sec. 1474.054.  ELECTION FOR ISSUING BONDS
313-12   Sec. 1474.055.  ORDER ISSUING BONDS AND IMPOSING TAX
313-13   Sec. 1474.056.  ELECTION FOR ISSUING NOTES:
313-14                     ORDER AND NOTICE
313-15   Sec. 1474.057.  ELECTION FOR ISSUING NOTES:
313-16                     BALLOT AND RETURNS
313-17   Sec. 1474.058.  APPROVAL AND ISSUANCE OF NOTES
313-18           (Sections 1474.059-1474.100 reserved for expansion)
313-19                SUBCHAPTER C.  LIMITATIONS AND PROCEDURES
313-20   Sec. 1474.101.  LIMIT ON DEBT
313-21   Sec. 1474.102.  COURT ACTION TO DETERMINE VALIDITY OF BONDS
313-22   Sec. 1474.103.  FORM OF BONDS AND NOTES; SIGNATURES;
313-23                     REGISTRATION BY COUNTY CLERK
313-24   Sec. 1474.104.  EXCHANGING BONDS FOR PROPERTY OR WORK
313-25   Sec. 1474.105.  SALE OR EXCHANGE OF BONDS AND NOTES; DELIVERY
313-26                     OF PROCEEDS
313-27   Sec. 1474.106.  IMPOSITION OF TAX; SEPARATE FUND
 314-1           (Sections 1474.107-1474.150 reserved for expansion)
 314-2          SUBCHAPTER D.  RELATED IRRIGATION POWERS OF COUNTIES
 314-3   Sec. 1474.151.  COUNTY POWERS
 314-4   Sec. 1474.152.  CONTROL OF COUNTY IRRIGATION SYSTEM
 314-5           CHAPTER 1474.  BONDS FOR COUNTY WATER IMPROVEMENTS
 314-6     SUBCHAPTER A.  PURPOSES FOR WHICH BONDS AND NOTES MAY BE ISSUED
 314-7         Sec. 1474.001.  AUTHORITY TO ISSUE BONDS FOR IRRIGATION
 314-8   PURPOSES.  A county may issue bonds in an amount not to exceed
 314-9   one-fourth of the assessed value of the real property in the county
314-10   for:
314-11               (1)  constructing, purchasing, or maintaining a pool,
314-12   lake, reservoir, dam, canal, or waterway for irrigation purposes or
314-13   to aid in irrigation;
314-14               (2)  enlarging an improvement described by Subdivision
314-15   (1); or
314-16               (3)  paying expenses incidental to the construction,
314-17   purchase, maintenance, or enlargement.  (V.A.C.S. Art. 803 (part).)
314-18         Sec. 1474.002.  AUTHORITY TO ISSUE ADDITIONAL BONDS FOR
314-19   IRRIGATION PURPOSES.  (a)  The commissioners court may order
314-20   additional bonds to be issued in accordance with this chapter if:
314-21               (1)  bonds have been authorized or issued under this
314-22   chapter;
314-23               (2)  the commissioners court considers it necessary to
314-24   issue additional bonds to change the proposed improvement, to
314-25   purchase or construct further improvements, to purchase additional
314-26   property to implement the purposes of the project, or to best serve
314-27   the interests of the county; and
 315-1               (3)  the additional bonds are approved at an election.
 315-2         (b)  The commissioners court shall enter its findings under
 315-3   Subsection (a) in the record of the court's proceedings.
 315-4         (c)  The commissioners court shall hold the election on the
 315-5   additional bonds in accordance with this chapter.  (V.A.C.S.
 315-6   Art. 809.)
 315-7         Sec. 1474.003.  AUTHORITY TO ISSUE BONDS OR NOTES FOR REPAIR
 315-8   PURPOSES.  (a)  If a county has constructed or purchased an
 315-9   improvement under this chapter that has been damaged and it is
315-10   necessary to raise money to repair the damage, the county may issue
315-11   bonds or notes under this chapter to raise the money.
315-12         (b)  The term of a note issued under this chapter may not
315-13   exceed 20 years.  (V.A.C.S. Art. 810.)
315-14         Sec. 1474.004.  AUTHORITY TO ISSUE BONDS FOR OTHER
315-15   WATER-RELATED IMPROVEMENTS.  A county may issue bonds for the
315-16   improvement of a river, creek, or stream to prevent overflow and
315-17   for all necessary drainage purposes in connection with that
315-18   purpose.  (V.A.C.S. Art. 821 (part).)
315-19           (Sections 1474.005-1474.050 reserved for expansion)
315-20                   SUBCHAPTER B.  ELECTION PROVISIONS
315-21         Sec. 1474.051.  BONDS FOR MORE THAN ONE PURPOSE.  Bonds
315-22   proposed to be issued for any two or more of the purposes stated in
315-23   this chapter shall be treated as being for one purpose and may be
315-24   voted on as one proposition.  (V.A.C.S. Art. 821 (part).)
315-25         Sec. 1474.052.  PETITION FOR BOND ELECTION.  If at least 50
315-26   voters who reside in and own taxable property in a county petition
315-27   the commissioners court for an election on the question of issuing
 316-1   bonds under Section 1474.001 and either Section 52, Article III, or
 316-2   Section 59, Article XVI, Texas Constitution, the commissioners
 316-3   court shall, at a regular or special session of the court, order an
 316-4   election to determine whether the county shall:
 316-5               (1)  issue bonds for the purposes stated in Section
 316-6   1474.001; and
 316-7               (2)  impose a tax on the property in the county for the
 316-8   purpose of paying the interest on the bonds and providing a sinking
 316-9   fund for the redemption of the bonds. (V.A.C.S. Art. 804.)
316-10         Sec. 1474.053.  REQUIREMENT TO STATE CHARACTERISTICS OF
316-11   BONDS.  (a)  Except as provided by Subsection (b), the petition for
316-12   the election, the election order, and the notice of the election
316-13   must state:
316-14               (1)  the amount of bonds to be issued;
316-15               (2)  the rate of interest of the bonds;
316-16               (3)  the times at which interest on the bonds is
316-17   payable; and
316-18               (4)  the date of maturity of the bonds.
316-19         (b)  The election order and the notice of the election may
316-20   provide that:
316-21               (1)  the bonds may bear interest at a rate to be set by
316-22   the commissioners court;
316-23               (2)  any interest may be paid at times set by the
316-24   commissioners court; and
316-25               (3)  the bonds may mature at the times set by the
316-26   commissioners court. (V.A.C.S.  Art. 805.)
316-27         Sec. 1474.054.  ELECTION FOR ISSUING BONDS.  (a)  The general
 317-1   election laws of this state govern the election except as provided
 317-2   by this section.
 317-3         (b)  A two-thirds vote of the qualified voters of the county
 317-4   voting in the election is necessary to approve the proposition.
 317-5         (c)  The commissioners court shall furnish the ballots for
 317-6   each polling place.  The ballots shall be printed to permit voting
 317-7   for or against the proposition: "The issuance of bonds for (purpose
 317-8   of the bonds) and the imposition of a tax to pay for the bonds."
 317-9         (d)  In addition to the requirements provided by Chapter 3,
317-10   Election Code, the election order shall:
317-11               (1)  designate one or more polling places in each
317-12   voting precinct in the county where the election will be held; and
317-13               (2)  name a presiding judge, a judge, and two clerks
317-14   for each polling place or, if the court considers it necessary,
317-15   name more election officers for any polling place.
317-16         (e)  A copy of the election order signed by the county judge
317-17   serves as proper notice of the election.
317-18         (f)  In addition to the notice required by Section 4.003(c),
317-19   Election Code, a copy of the election order shall be:
317-20               (1)  posted at each polling place and at the courthouse
317-21   door before the 20th day before the date of the election; and
317-22               (2)  published in a newspaper published in the county
317-23   for three consecutive weeks before the date of the election, with
317-24   the first publication before the 21st day before the date of the
317-25   election.
317-26         (g)  After preparing the returns of the election, the
317-27   presiding judge at each polling place shall deliver the returns to
 318-1   the county clerk, who shall keep them in a safe place and deliver
 318-2   them to the commissioners court. After canvassing the returns, the
 318-3   commissioners court shall declare the result of the election by an
 318-4   order entered in the minutes of the court.  (V.A.C.S. Art. 807.)
 318-5         Sec. 1474.055.  ORDER ISSUING BONDS AND IMPOSING TAX.  (a)
 318-6   If the issuance of the bonds and imposition of the tax are approved
 318-7   at the election, the commissioners court by order entered at a
 318-8   regular term of the court shall:
 318-9               (1)  direct the issuance of the bonds;
318-10               (2)  provide for the annual imposition of a tax
318-11   sufficient to pay the current interest on the bonds and to pay the
318-12   principal of the bonds at maturity; and
318-13               (3)  state the place or places at which the interest is
318-14   payable.
318-15         (b)  The commissioners court shall annually impose a tax
318-16   sufficient to pay the current interest on the bonds and to pay the
318-17   principal of the bonds at maturity.  (V.A.C.S. Arts.  808, 819
318-18   (part).)
318-19         Sec. 1474.056.  ELECTION FOR ISSUING NOTES: ORDER AND NOTICE.
318-20   (a)  Before notes are issued under Section 1474.003, the
318-21   commissioners court shall order and give notice of an election in
318-22   the manner required for an election on a bond issue.
318-23         (b)  In addition to the requirements provided by Chapters 3
318-24   and 4, Election Code, the order and notice shall state:
318-25               (1)  the purpose for which the notes are to be issued;
318-26               (2)  the duration of the notes;
318-27               (3)  the rate of interest; and
 319-1               (4)  the polling places for the election.
 319-2         (c)  The order and notice may state the manner in which the
 319-3   notes mature.  (V.A.C.S. Arts. 811, 813 (part).)
 319-4         Sec. 1474.057.  ELECTION FOR ISSUING NOTES: BALLOT AND
 319-5   RETURNS.  (a)  At an election to issue notes, the ballot shall be
 319-6   printed to permit voting for or against the proposition: "The
 319-7   issuance of notes for (purpose of the notes)."
 319-8         (b)  The commissioners court shall hold the election in the
 319-9   manner provided by this chapter for a bond election.  (V.A.C.S.
319-10   Art. 812 (part).)
319-11         Sec. 1474.058.  APPROVAL AND ISSUANCE OF NOTES.  (a)  If at
319-12   least two-thirds of the votes received at the election favor
319-13   issuing the notes, the commissioners court may issue and sell the
319-14   notes for the benefit of the county and for the purposes
319-15   authorized.
319-16         (b)  The commissioners court by order shall:
319-17               (1)  direct the issuance of the notes; and
319-18               (2)  provide for the annual imposition of a tax
319-19   sufficient to pay the current interest and provide a sinking fund
319-20   for the payment of the principal of the notes at maturity.
319-21   (V.A.C.S. Arts. 812 (part), 813 (part).)
319-22           (Sections 1474.059-1474.100 reserved for expansion)
319-23                SUBCHAPTER C.  LIMITATIONS AND PROCEDURES
319-24         Sec. 1474.101.  LIMIT ON DEBT.  (a)  If a county contains one
319-25   or more districts organized under Section 52, Article III, or
319-26   Section 59, Article XVI, Texas Constitution, the ratio of the debt
319-27   of a district to the assessed value of real property in the
 320-1   district, expressed as a percentage, together with the ratio of the
 320-2   proposed county debt to the assessed value of real property in the
 320-3   county, expressed as a percentage, may not exceed one-fourth of the
 320-4   assessed value of real property in the county or in the district.
 320-5         (b)  The assessed value of real property in a county or in a
 320-6   district is computed according to the most recent appraisal roll of
 320-7   the county or district, as appropriate.  (V.A.C.S. Art. 806.)
 320-8         Sec. 1474.102.  COURT ACTION TO DETERMINE VALIDITY OF BONDS.
 320-9   (a)  A county that proposes to issue bonds under this chapter shall
320-10   bring an action in a district court in the county or in a district
320-11   court in Travis County to determine the validity of the bonds.
320-12         (b)  The action shall be brought in the manner provided by
320-13   Subchapter L, Chapter 55, Water Code, for the validation of water
320-14   improvement district bonds.  Each provision of that subchapter that
320-15   is applicable to the action, including provisions applicable to the
320-16   duties of the attorney general and comptroller, the judgment to be
320-17   rendered, the effect of the judgment, and other matters connected
320-18   to the action, applies to the validation of the county bonds.
320-19   (V.A.C.S. Art. 817.)
320-20         Sec. 1474.103.  FORM OF BONDS AND NOTES; SIGNATURES;
320-21   REGISTRATION BY COUNTY CLERK.  (a)  Each bond or note issued under
320-22   this chapter shall be issued in the name of the county.
320-23         (b)  A bond shall be designated "________ County Water
320-24   Improvement Bond."  A note shall be designated "_______ County
320-25   Water Improvement Note."
320-26         (c)  Each bond or note issued under this chapter must be:
320-27               (1)  signed by the county judge;
 321-1               (2)  countersigned by the county clerk; and
 321-2               (3)  registered by the county treasurer.  (V.A.C.S.
 321-3   Art. 814 (part).)
 321-4         Sec. 1474.104.  EXCHANGING BONDS FOR PROPERTY OR WORK.  The
 321-5   commissioners court may exchange bonds issued under this chapter:
 321-6               (1)  for property; or
 321-7               (2)  in payment of the contract price for work to be
 321-8   done in the construction of the improvements. (V.A.C.S. Art. 815.)
 321-9         Sec. 1474.105.  SALE OR EXCHANGE OF BONDS AND NOTES; DELIVERY
321-10   OF PROCEEDS.  (a)  The commissioners court shall sell or exchange
321-11   the bonds or notes issued under this chapter on the best terms.
321-12         (b)  When the bonds or notes are sold, the proceeds shall
321-13   immediately be delivered to the county treasurer. (V.A.C.S.
321-14   Art. 816 (part).)
321-15         Sec. 1474.106.  IMPOSITION OF TAX; SEPARATE FUND.  (a)  A tax
321-16   imposed under Section 1474.055(b) shall be imposed as other county
321-17   taxes.
321-18         (b)  The proceeds of the tax are a separate fund that may not
321-19   be used for a purpose other than a purpose specified by Section
321-20   1474.055(b).  (V.A.C.S. Art. 819 (part).)
321-21           (Sections 1474.107-1474.150 reserved for expansion)
321-22          SUBCHAPTER D.  RELATED IRRIGATION POWERS OF COUNTIES
321-23         Sec. 1474.151.  COUNTY POWERS.  A county acting under this
321-24   chapter may:
321-25               (1)  own or construct a reservoir, dam, levee, well,
321-26   canal, or other improvement;
321-27               (2)  acquire a necessary right-of-way or other land by
 322-1   purchase or by condemnation in the manner provided by Chapter 21,
 322-2   Property Code; or
 322-3               (3)  perform any other work or construct or acquire any
 322-4   other improvement required for the proper and efficient irrigation
 322-5   of land in the county. (V.A.C.S. Art. 818.)
 322-6         Sec. 1474.152.  CONTROL OF COUNTY IRRIGATION SYSTEM.  (a)
 322-7   The commissioners court shall control and manage the affairs and
 322-8   operation of the county's irrigation system to the same extent and
 322-9   in the manner as the board of directors of a water improvement
322-10   district controls and manages a water improvement district under
322-11   Chapter 49, Water Code.
322-12         (b)  The provisions of Chapter 49, Water Code, that apply to
322-13   the control and management of the affairs and operation of a water
322-14   improvement district also apply to the control and management of
322-15   the affairs and operation of the county's irrigation system.
322-16   (V.A.C.S. Art. 820.)
322-17         CHAPTER 1475.  COUNTY BONDS AND WARRANTS FOR NAVIGATION
322-18                                PURPOSES
322-19       SUBCHAPTER A.  RIGHT-OF-WAY FOR FEDERAL NAVIGATION PROJECTS
322-20   Sec. 1475.001.  PURPOSE; LIBERAL CONSTRUCTION
322-21   Sec. 1475.002.  AUTHORITY TO ACQUIRE RIGHT-OF-WAY AND DUMPING
322-22                     PRIVILEGES
322-23   Sec. 1475.003.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAXES
322-24   Sec. 1475.004.  ELECTION
322-25   Sec. 1475.005.  DUTIES OF COMMISSIONERS COURT AFTER VOTER
322-26                     APPROVAL
322-27   Sec. 1475.006.  INVESTMENT OF SINKING FUND
 323-1   Sec. 1475.007.  ISSUANCE OF BONDS AND WARRANTS; USE OF
 323-2                     PROCEEDS
 323-3           (Sections 1475.008-1475.050 reserved for expansion)
 323-4         SUBCHAPTER B.  PROPERTY FOR INTRACOASTAL CANAL PURPOSES
 323-5   Sec. 1475.051.  APPLICABILITY OF SUBCHAPTER
 323-6   Sec. 1475.052.  AUTHORITY TO ACQUIRE LAND AND CERTAIN INTERESTS
 323-7                     IN LAND FOR CANAL PURPOSES
 323-8   Sec. 1475.053.  AUTHORITY TO ISSUE TIME WARRANTS
 323-9   Sec. 1475.054.  APPLICABILITY OF OTHER LAWS TO CONDEMNATION
323-10                     PROCEEDINGS
323-11   Sec. 1475.055.  EFFECT OF APPEAL
323-12    CHAPTER 1475.  COUNTY BONDS AND WARRANTS FOR NAVIGATION PURPOSES
323-13       SUBCHAPTER A.  RIGHT-OF-WAY FOR FEDERAL NAVIGATION PROJECTS
323-14         Sec. 1475.001.  PURPOSE; LIBERAL CONSTRUCTION.  (a)  The only
323-15   purpose of this subchapter is to grant counties in this state the
323-16   authority to issue bonds or warrants or to otherwise lend their
323-17   credit for the acquisition and conveyance to the United States of
323-18   the necessary right-of-way for waterways or navigable canals:
323-19               (1)  the construction of which is authorized by federal
323-20   legislation; and
323-21               (2)  the cost of construction and maintenance of which
323-22   is to be paid by the United States.
323-23         (b)  This subchapter shall be liberally construed to
323-24   accomplish that purpose. (V.A.C.S. Art. 822e (part).)
323-25         Sec. 1475.002.  AUTHORITY TO ACQUIRE RIGHT-OF-WAY AND DUMPING
323-26   PRIVILEGES.  (a)  For the purpose of navigation or to aid in
323-27   navigation, a county may, in accordance with Section 1475.003,
 324-1   acquire right-of-way and necessary dumping privileges for a canal
 324-2   or waterway the construction of which is authorized by federal
 324-3   legislation.
 324-4         (b)  The county may:
 324-5               (1)  acquire the right-of-way and necessary dumping
 324-6   privileges by purchase, through donation, or by exercising the
 324-7   county's power of eminent domain; and
 324-8               (2)  convey the right-of-way and dumping privileges to
 324-9   the United States by a deed executed in the manner that other deeds
324-10   by a county must be executed.
324-11         (c)  In lieu of exercising its power of eminent domain, the
324-12   county may:
324-13               (1)  allow the United States to acquire the
324-14   right-of-way and necessary dumping privileges through the United
324-15   States' power of eminent domain; and
324-16               (2)  lend the county's credit by guaranteeing the
324-17   United States that the county will pay the resulting judgment or
324-18   assessment of damages for the value of the condemned property.
324-19   (V.A.C.S. Arts. 822a (part), 822b, 822e (part).)
324-20         Sec. 1475.003.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAXES.
324-21   To pay for an action authorized by Section 1475.002, a county may,
324-22   on the approval of at least two-thirds of the qualified voters of
324-23   the county who vote on the measure:
324-24               (1)  issue bonds or warrants or otherwise lend its
324-25   credit in addition to its other debt and in an amount not to exceed
324-26   one-fourth of the taxable value of the real property in the county;
324-27   and
 325-1               (2)  impose taxes to pay the interest on and to provide
 325-2   a sinking fund for the redemption of the debt. (V.A.C.S.  Art. 822a
 325-3   (part).)
 325-4         Sec. 1475.004.  ELECTION.  (a)  The commissioners court of a
 325-5   county:
 325-6               (1)  may, on its own motion, order an election to
 325-7   determine whether the county will issue bonds or warrants or
 325-8   otherwise lend its credit to take an action under Section 1475.002;
 325-9   and
325-10               (2)  shall order such an election if a petition signed
325-11   by at least 25 of the resident owners of taxable property in the
325-12   county that calls for the election is filed with the commissioners
325-13   court.
325-14         (b)  The election order must include as close a description
325-15   as possible of:
325-16               (1)  the proposed navigation purposes, aid to
325-17   navigation, or right-of-way and necessary dumping privileges to be
325-18   acquired;
325-19               (2)  the amount of the proposed bonds or warrants or
325-20   the extent of the credit proposed to be authorized for those
325-21   purposes;
325-22               (3)  if the commissioners court proposes to issue bonds
325-23   or warrants, the maturity dates and rate of interest of the bonds
325-24   or warrants; and
325-25               (4)  if the commissioners court proposes to lend the
325-26   credit of the county, the manner in which the credit is to be used
325-27   and the terms of the credit to be authorized.
 326-1         (c)  Subject to Section 4.003(c), Election Code, the
 326-2   commissioners court shall give 20 days notice of the election:
 326-3               (1)  by publication in a newspaper published at the
 326-4   county seat; and
 326-5               (2)  by posting in three public places in the county,
 326-6   one of which must be at the county seat.
 326-7         (d)  The ballot shall be printed to permit voting for or
 326-8   against the proposition: "The issuance of bonds (or, if
 326-9   appropriate, 'the issuance of warrants' or 'the lending of credit')
326-10   and the imposition of a tax in payment of the bonds (or, if
326-11   appropriate, 'in payment of the warrants' or 'in payment of the
326-12   lending of credit')."  (V.A.C.S. Art. 822c (part).)
326-13         Sec. 1475.005.  DUTIES OF COMMISSIONERS COURT AFTER VOTER
326-14   APPROVAL.  If the voters approve the proposition, the commissioners
326-15   court shall enter in its minutes:
326-16               (1)  the date of the election, the notice of the
326-17   election, the ballot proposition, and the result of the election;
326-18   and
326-19               (2)  an order that, as appropriate:
326-20                     (A)  provides for the issuance of the bonds or
326-21   warrants and states the amount, dates of maturity, and rate of
326-22   interest of the bonds or warrants; or
326-23                     (B)  authorizes the use of the county's credit,
326-24   specifies the extent to which the county will lend its credit, and
326-25   specifies the manner by and conditions under which the county will
326-26   lend its credit.  (V.A.C.S. Art. 822c (part).)
326-27         Sec. 1475.006.  INVESTMENT OF SINKING FUND.  Money deposited
 327-1   to the credit of the sinking fund of bonds or warrants issued under
 327-2   this subchapter shall be invested as money deposited to the credit
 327-3   of the sinking funds of other county bonds is invested.  (V.A.C.S.
 327-4   Art. 822d (part).)
 327-5         Sec. 1475.007.  ISSUANCE OF BONDS AND WARRANTS; USE OF
 327-6   PROCEEDS.  (a)  A bond or warrant issued under this subchapter
 327-7   shall be:
 327-8               (1)  issued in the name of the county;
 327-9               (2)  signed by the county judge; and
327-10               (3)  attested by the county clerk under the seal of the
327-11   commissioners court.
327-12         (b)  The commissioners court shall sell the bond or warrant
327-13   on the best terms possible.
327-14         (c)  All money received from the sale of the bond or warrant
327-15   shall be paid to the county treasurer.  The county treasurer shall:
327-16               (1)  deposit the money to the credit of the county's
327-17   navigation fund account; and
327-18               (2)  pay out the money on warrants in the manner that
327-19   other county funds are disbursed. (V.A.C.S. Art. 822d (part).)
327-20           (Sections 1475.008-1475.050 reserved for expansion)
327-21         SUBCHAPTER B.  PROPERTY FOR INTRACOASTAL CANAL PURPOSES
327-22         Sec. 1475.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
327-23   applies only to a county adjacent to the Gulf of Mexico.  (V.A.C.S.
327-24   Art. 822f (part).)
327-25         Sec. 1475.052.  AUTHORITY TO ACQUIRE LAND AND CERTAIN
327-26   INTERESTS IN LAND FOR CANAL PURPOSES.  (a)  If the acquisition is
327-27   necessary for the construction of an intracoastal canal, a county
 328-1   may, by purchase or by exercising the county's power of eminent
 328-2   domain, acquire public or private land, a right-of-way, an
 328-3   easement, or dumping ground privileges.
 328-4         (b)  The county must exercise the power of eminent domain in
 328-5   the manner provided by Chapter 21, Property Code.  A county may not
 328-6   condemn land under Subsection (a) if the land is used for cemetery
 328-7   purposes.  (V.A.C.S. Art. 822f (part).)
 328-8         Sec. 1475.053.  AUTHORITY TO ISSUE TIME WARRANTS.  The
 328-9   commissioners court of a county may issue time warrants to pay for
328-10   an acquisition under Section 1475.052.  (V.A.C.S. Art. 822f
328-11   (part).)
328-12         Sec. 1475.054.  APPLICABILITY OF OTHER LAWS TO CONDEMNATION
328-13   PROCEEDINGS.  Sections 261.002 and 261.003, Local Government Code,
328-14   apply to a condemnation proceeding brought under this subchapter.
328-15   (V.A.C.S. Art. 822f (part).)
328-16         Sec. 1475.055.  EFFECT OF APPEAL.  An appeal from a finding
328-17   and assessment of damages made as described by Chapter 21, Property
328-18   Code, does not suspend work by the United States that relates to
328-19   the property or property right sought to be acquired.  (V.A.C.S.
328-20   Art. 822f (part).)
328-21         CHAPTER 1476.  CERTIFICATES OF INDEBTEDNESS IN COUNTIES
328-22                WITH POPULATION OF MORE THAN 1.5 MILLION
328-23   Sec. 1476.001.  APPLICABILITY OF CHAPTER
328-24   Sec. 1476.002.  AUTHORITY TO ISSUE CERTIFICATES OF
328-25                     INDEBTEDNESS FOR CERTAIN PURPOSES
328-26   Sec. 1476.003.  AUTHORIZATION OF CERTIFICATES OF INDEBTEDNESS
328-27                     BY COMMISSIONERS COURT
 329-1   Sec. 1476.004.  EXECUTION; REGISTRATION BY COUNTY TREASURER
 329-2   Sec. 1476.005.  CASH SALE
 329-3   Sec. 1476.006.  MATURITY
 329-4         CHAPTER 1476.  CERTIFICATES OF INDEBTEDNESS IN COUNTIES
 329-5                WITH POPULATION OF MORE THAN 1.5 MILLION
 329-6         Sec. 1476.001.  APPLICABILITY OF CHAPTER.  (a)  This chapter
 329-7   applies only to a county with a population of more than 1.5
 329-8   million.
 329-9         (b)  If certificates of indebtedness were not issued under
329-10   this chapter by January 1, 1980, this chapter has no effect.
329-11   (V.A.C.S. Art. 717n-1, Sec. 1 (part).)
329-12         Sec. 1476.002.  AUTHORITY TO ISSUE CERTIFICATES OF
329-13   INDEBTEDNESS FOR CERTAIN PURPOSES.  A county may issue certificates
329-14   of indebtedness:
329-15               (1)  in an amount not to exceed $2 million to
329-16   construct, enlarge, furnish, equip, or repair a county building or
329-17   other permanent improvement; or
329-18               (2)  in an amount not to exceed $3.5 million to:
329-19                     (A)  purchase right-of-way in participation with
329-20   the Texas Department of Transportation in connection with a
329-21   designated state highway; or
329-22                     (B)  construct a curb, gutter, or drainage
329-23   facility for a designated state highway.  (V.A.C.S. Art. 717n-1,
329-24   Secs. 1 (part), 2 (part).)
329-25         Sec. 1476.003.  AUTHORIZATION OF CERTIFICATES OF INDEBTEDNESS
329-26   BY COMMISSIONERS COURT.  Certificates of indebtedness issued under
329-27   this chapter must be authorized by order of the commissioners court
 330-1   of the county.  (V.A.C.S. Art. 717n-1, Sec. 2 (part).)
 330-2         Sec. 1476.004.  EXECUTION; REGISTRATION BY COUNTY TREASURER.
 330-3   A certificate of indebtedness issued under this chapter must be:
 330-4               (1)  signed by the county judge;
 330-5               (2)  attested by the county clerk; and
 330-6               (3)  registered by the county treasurer.  (V.A.C.S.
 330-7   Art. 717n-1, Sec. 2 (part).)
 330-8         Sec. 1476.005.  CASH SALE.  A county shall sell certificates
 330-9   of indebtedness issued under this chapter for cash.  (V.A.C.S.
330-10   Art. 717n-1, Sec. 2 (part).)
330-11         Sec. 1476.006.  MATURITY.  A certificate of indebtedness
330-12   issued under this chapter must mature not later than 35 years after
330-13   its date.  (V.A.C.S. Art. 717n-1, Sec. 2 (part).)
330-14          CHAPTER 1477.  OBLIGATIONS FOR OTHER COUNTY PURPOSES
330-15            SUBCHAPTER A.  BONDS FOR FACILITIES TO BE LEASED
330-16                      TO PUBLIC OR PRIVATE ENTITIES
330-17   Sec. 1477.001.  AUTHORITY TO ACQUIRE PROPERTY FOR LEASE TO
330-18                     PUBLIC OR PRIVATE ENTITY
330-19   Sec. 1477.002.  AUTHORITY TO ISSUE BONDS
330-20   Sec. 1477.003.  BOND PAYMENTS FROM REVENUE OR TAXES
330-21   Sec. 1477.004.  ELECTION REQUIRED TO SECURE BONDS WITH TAXES
330-22   Sec. 1477.005.  CONTENTS OF ORDINANCE, ORDER, OR RESOLUTION
330-23                     AUTHORIZING BONDS
330-24   Sec. 1477.006.  ADOPTION AND EXECUTION OF DOCUMENTS
330-25   Sec. 1477.007.  MATURITY
330-26   Sec. 1477.008.  IMPOSITION OF TAX
330-27   Sec. 1477.009.  GRANTS FOR PRISONS OR LAW ENFORCEMENT
 331-1                     FACILITIES NOT PROHIBITED
 331-2           (Sections 1477.010-1477.050 reserved for expansion)
 331-3        SUBCHAPTER B.  BONDS FOR WATER SUPPLY FOR COUNTY PURPOSES
 331-4   Sec. 1477.051.  APPLICABILITY OF SUBCHAPTER
 331-5   Sec. 1477.052.  DEFINITION
 331-6   Sec. 1477.053.  AUTHORITY TO ACQUIRE WATER SUPPLY
 331-7   Sec. 1477.054.  LIMITATION ON COST
 331-8   Sec. 1477.055.  AUTHORITY TO ISSUE BONDS AND IMPOSE AD VALOREM
 331-9                     TAXES
331-10   Sec. 1477.056.  AMOUNT OF TAX
331-11   Sec. 1477.057.  ELECTION
331-12   Sec. 1477.058.  CONTENTS OF ORDER AUTHORIZING BONDS
331-13   Sec. 1477.059.  MATURITY
331-14   Sec. 1477.060.  SIGNATURES; REGISTRATION BY COUNTY
331-15                     TREASURER
331-16   Sec. 1477.061.  SALE OF BONDS
331-17   Sec. 1477.062.  USE OF BOND PROCEEDS
331-18   Sec. 1477.063.  ADDITIONAL BONDS
331-19   Sec. 1477.064.  RATES AND CHARGES
331-20   Sec. 1477.065.  TAXES PLEDGED TO PAY BONDS
331-21   Sec. 1477.066.  BONDHOLDER'S RIGHT TO MANDAMUS
331-22   Sec. 1477.067.  REFUNDING BONDS
331-23   Sec. 1477.068.  EXEMPTION FROM ASSESSMENT OR TAXATION
331-24   Sec. 1477.069.  COUNTY USE OF WATER
331-25   Sec. 1477.070.  SALE OF WATER NOT NEEDED FOR COUNTY
331-26                     PURPOSES
331-27   Sec. 1477.071.  EMINENT DOMAIN
 332-1   Sec. 1477.072.  RELOCATION OR ALTERATION EXPENSE
 332-2   Sec. 1477.073.  ESSENTIAL GOVERNMENTAL FUNCTION
 332-3           (Sections 1477.074-1477.100 reserved for expansion)
 332-4         SUBCHAPTER C.  NATURAL GAS SYSTEM FOR COUNTY BUILDINGS
 332-5                           IN CERTAIN COUNTIES
 332-6   Sec. 1477.101.  APPLICABILITY OF SUBCHAPTER
 332-7   Sec. 1477.102.  AUTHORITY TO ACQUIRE NATURAL GAS SYSTEM
 332-8   Sec. 1477.103.  NATURAL GAS SYSTEM FACILITIES
 332-9   Sec. 1477.104.  AUTHORITY TO ISSUE BONDS
332-10   Sec. 1477.105.  BONDS NOT PAYABLE FROM TAXES
332-11   Sec. 1477.106.  NOTICE OF INTENTION TO ISSUE BONDS
332-12   Sec. 1477.107.  ELECTION
332-13   Sec. 1477.108.  CONTENTS OF ORDER AUTHORIZING BONDS
332-14   Sec. 1477.109.  MATURITY
332-15   Sec. 1477.110.  SIGNATURES; REGISTRATION BY COUNTY
332-16                     TREASURER
332-17   Sec. 1477.111.  SALE OF BONDS
332-18   Sec. 1477.112.  USE OF BOND PROCEEDS
332-19   Sec. 1477.113.  ADDITIONAL BONDS
332-20   Sec. 1477.114.  GAS RATES AND CHARGES
332-21   Sec. 1477.115.  BONDHOLDER'S RIGHT TO MANDAMUS
332-22   Sec. 1477.116.  REFUNDING BONDS
332-23   Sec. 1477.117.  EXEMPTION FROM ASSESSMENT OR TAXATION
332-24   Sec. 1477.118.  COUNTY USE OF GAS
332-25   Sec. 1477.119.  SALE OF GAS NOT NEEDED FOR COUNTY PURPOSES
332-26   Sec. 1477.120.  EMINENT DOMAIN
332-27   Sec. 1477.121.  RELOCATION OR ALTERATION EXPENSE
 333-1   Sec. 1477.122.  ESSENTIAL GOVERNMENTAL FUNCTION
 333-2           (Sections 1477.123-1477.150 reserved for expansion)
 333-3         SUBCHAPTER D.  OBLIGATIONS FOR FIRE-FIGHTING EQUIPMENT 
 333-4   Sec. 1477.151.  AUTHORITY TO PURCHASE FIRE-FIGHTING
 333-5                     EQUIPMENT
 333-6   Sec. 1477.152.  AUTHORITY TO ISSUE OBLIGATIONS AND IMPOSE
 333-7                     TAXES
 333-8   Sec. 1477.153.  LIMIT ON AMOUNT OF OBLIGATIONS
 333-9           (Sections 1477.154-1477.200 reserved for expansion)
333-10       SUBCHAPTER E.  CERTIFICATES OF INDEBTEDNESS FOR FIREFIGHTER
333-11                           TRAINING FACILITIES
333-12   Sec. 1477.201.  AUTHORITY TO ISSUE CERTIFICATES OF
333-13                     INDEBTEDNESS
333-14   Sec. 1477.202.  AUTHORITY TO IMPOSE AND PLEDGE AD VALOREM
333-15                     TAX
333-16   Sec. 1477.203.  LIMIT ON AMOUNT OF INDEBTEDNESS
333-17   Sec. 1477.204.  ELECTION
333-18   Sec. 1477.205.  MATURITY
333-19   Sec. 1477.206.  OPERATION OF FIREFIGHTER TRAINING
333-20                     FACILITIES
333-21           (Sections 1477.207-1477.250 reserved for expansion)
333-22          SUBCHAPTER F.  BONDS FOR SURVEYS, MAPS, AND PLATS IN
333-23               COUNTIES WITH POPULATION OF 500,000 OR MORE
333-24   Sec. 1477.251.  APPLICABILITY OF SUBCHAPTER
333-25   Sec. 1477.252.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAXES
333-26   Sec. 1477.253.  ELECTION PROPOSITION
333-27   Sec. 1477.254.  BONDS OBLIGATION OF COUNTY
 334-1           (Sections 1477.255-1477.300 reserved for expansion)
 334-2        SUBCHAPTER G.  REVENUE BONDS FOR IMPROVEMENTS TO ATTRACT
 334-3                VISITORS OR TOURISTS IN CERTAIN COUNTIES
 334-4   Sec. 1477.301.  APPLICABILITY OF SUBCHAPTER
 334-5   Sec. 1477.302.  AUTHORITY FOR VISITOR OR TOURIST
 334-6                     ATTRACTIONS
 334-7   Sec. 1477.303.  AUTHORITY TO ISSUE REVENUE BONDS
 334-8   Sec. 1477.304.  PLEDGE OF REVENUE
 334-9   Sec. 1477.305.  LIEN ON FACILITY
334-10   Sec. 1477.306.  BONDS NOT PAYABLE FROM TAXATION; EXCEPTION
334-11   Sec. 1477.307.  CONTENTS OF ORDER AUTHORIZING BONDS
334-12   Sec. 1477.308.  ADOPTION AND EXECUTION OF DOCUMENTS
334-13   Sec. 1477.309.  MATURITY
334-14   Sec. 1477.310.  SIGNATURES
334-15   Sec. 1477.311.  SALE OF BONDS
334-16   Sec. 1477.312.  USE OF BOND PROCEEDS
334-17   Sec. 1477.313.  INVESTMENT OF FUNDS
334-18   Sec. 1477.314.  CHARGES FOR SERVICES
334-19   Sec. 1477.315.  REFUNDING BONDS
334-20           (Sections 1477.316-1477.350 reserved for expansion)
334-21      SUBCHAPTER H.  REVENUE ANTICIPATION NOTES IN CERTAIN COUNTIES
334-22   Sec. 1477.351.  APPLICABILITY OF SUBCHAPTER
334-23   Sec. 1477.352.  AUTHORITY TO ISSUE REVENUE ANTICIPATION
334-24                     NOTES
334-25   Sec. 1477.353.  LIMIT ON AMOUNT OF NOTES
334-26   Sec. 1477.354.  MATURITY
334-27   Sec. 1477.355.  REVENUE AVAILABLE FOR PAYMENT OF NOTES
 335-1           (Sections 1477.356-1477.400 reserved for expansion)
 335-2        SUBCHAPTER I. OBLIGATIONS IN COUNTIES WITH POPULATION OF
 335-3                             LESS THAN 8,600
 335-4   Sec. 1477.401.  APPLICABILITY OF SUBCHAPTER
 335-5   Sec. 1477.402.  AUTHORITY TO BORROW
 335-6   Sec. 1477.403.  AUTHORITY TO ISSUE OBLIGATIONS
 335-7   Sec. 1477.404.  AUTHORITY TO IMPOSE AND PLEDGE TAXES AND
 335-8                     REVENUES
 335-9   Sec. 1477.405.  MATURITY
335-10   Sec. 1477.406.  SIGNATURES
335-11   Sec. 1477.407.  VALIDITY OF OBLIGATION
335-12          CHAPTER 1477.  OBLIGATIONS FOR OTHER COUNTY PURPOSES
335-13            SUBCHAPTER A.  BONDS FOR FACILITIES TO BE LEASED
335-14                      TO PUBLIC OR PRIVATE ENTITIES
335-15         Sec. 1477.001.  AUTHORITY TO ACQUIRE PROPERTY FOR LEASE TO
335-16   PUBLIC OR PRIVATE ENTITY.  (a)  The commissioners court of a county
335-17   may acquire real property and may construct or acquire a building
335-18   or other facility for the purpose of leasing the real property,
335-19   building, or other facility to:
335-20               (1)  a political subdivision or state agency for public
335-21   use; or
335-22               (2)  an individual, private corporation, or other
335-23   private entity for use in manufacturing or another commercial
335-24   activity.
335-25         (b)  The commissioners court may not acquire real property
335-26   under Subsection (a) by eminent domain.  (V.A.C.S. Art. 725d, Sec.
335-27   2.)
 336-1         Sec. 1477.002.  AUTHORITY TO ISSUE BONDS.  To develop and
 336-2   diversify the economy of this state and eliminate unemployment or
 336-3   underemployment in this state under the authority granted by
 336-4   Section 52-a, Article III, Texas Constitution, the commissioners
 336-5   court may issue and sell bonds to finance an action taken under
 336-6   Section 1477.001.  (V.A.C.S. Art. 725d, Secs.  1 (part), 3.)
 336-7         Sec. 1477.003.  BOND PAYMENTS FROM REVENUE OR TAXES.  The
 336-8   commissioners court may provide for payment of the principal of and
 336-9   interest on bonds issued under this subchapter by:
336-10               (1)  pledging all or part of the revenue from a lease
336-11   of all or part of the real property, building, or other facility
336-12   financed by the bonds, after deduction of reasonable operation and
336-13   maintenance costs;
336-14               (2)  imposing an annual ad valorem tax; or
336-15               (3)  combining those sources.  (V.A.C.S. Art. 725d,
336-16   Sec. 4.)
336-17         Sec. 1477.004.  ELECTION REQUIRED TO SECURE BONDS WITH TAXES.
336-18   A county may not issue bonds under this subchapter that are payable
336-19   in whole or in part from ad valorem taxes unless the bonds are
336-20   authorized by a majority of the registered voters of the county
336-21   voting on the issue.  (V.A.C.S. Art. 725d, Sec. 5(a).)
336-22         Sec. 1477.005.  CONTENTS OF ORDINANCE, ORDER, OR RESOLUTION
336-23   AUTHORIZING BONDS.  In the ordinance, order, or resolution
336-24   authorizing the issuance of bonds under this subchapter, the
336-25   commissioners court may:
336-26               (1)  provide for the deposit and accounting of funds
336-27   and the establishment and maintenance of an interest and sinking
 337-1   fund, a reserve fund, or other fund; and
 337-2               (2)  make additional covenants relating to the:
 337-3                     (A)  bonds;
 337-4                     (B)  pledged revenue; or
 337-5                     (C)  operation and maintenance of any real
 337-6   property, building, or other facility, the revenue of which is
 337-7   pledged for bond payments.  (V.A.C.S. Art. 725d, Sec. 6(c).)
 337-8         Sec. 1477.006.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
 337-9   commissioners court may adopt and have executed any proceeding or
337-10   instrument necessary and convenient:
337-11               (1)  in the issuance of a bond under this subchapter;
337-12   or
337-13               (2)  in the acquisition and lease of any real property,
337-14   building, or other facility under Section 1477.001.  (V.A.C.S.
337-15   Art. 725d, Sec. 7.)
337-16         Sec. 1477.007.  MATURITY.  A bond issued under this
337-17   subchapter must mature not later than 40 years after its date.
337-18   (V.A.C.S. Art. 725d, Sec. 6(b) (part).)
337-19         Sec. 1477.008.  IMPOSITION OF TAX.  (a)  The commissioners
337-20   court may annually impose ad valorem taxes to pay the principal of
337-21   and interest on bonds issued under this subchapter that are payable
337-22   in whole or in part from ad valorem taxes only if the taxes are
337-23   approved at an election held under Section 1477.004.
337-24         (b)  The commissioners court may not impose ad valorem taxes
337-25   to pay the principal of or interest on bonds issued under this
337-26   subchapter payable wholly from revenue from one or more leases or
337-27   other contracts made under this subchapter.  (V.A.C.S. Art. 725d,
 338-1   Sec. 10.)
 338-2         Sec. 1477.009.  GRANTS FOR PRISONS OR LAW ENFORCEMENT
 338-3   FACILITIES NOT PROHIBITED.  This subchapter does not prohibit a
 338-4   county from making a grant of money or property to an agency of the
 338-5   state to assist the agency in acquiring or developing a site for a:
 338-6               (1)  prison;
 338-7               (2)  law enforcement detention facility; or
 338-8               (3)  community corrections facility as defined by
 338-9   Section 509.001.  (V.A.C.S. Art. 725d, Sec. 11.)
338-10           (Sections 1477.010-1477.050 reserved for expansion)
338-11        SUBCHAPTER B.  BONDS FOR WATER SUPPLY FOR COUNTY PURPOSES
338-12         Sec. 1477.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
338-13   applies only to a county that adopted the law codified by this
338-14   subchapter by a unanimous vote of the members of the commissioners
338-15   court before September 2, 1963.  (V.A.C.S. Art. 2352e, Secs. 1,
338-16   15a.)
338-17         Sec. 1477.052.  DEFINITION.  In this subchapter, "project"
338-18   means any acquisition, construction, repair, or maintenance
338-19   authorized and undertaken under Section 1477.053.  (V.A.C.S.
338-20   Art. 2352e, Sec.  2 (part).)
338-21         Sec. 1477.053.  AUTHORITY TO ACQUIRE WATER SUPPLY.  (a)  The
338-22   commissioners court of the county may acquire by purchase,
338-23   construction, or otherwise an adequate source of surface or
338-24   subterranean fresh water for supplying water to the county's
338-25   courthouse or for other county purposes.
338-26         (b)  To further an acquisition under Subsection (a), the
338-27   commissioners court may purchase, construct, repair, and maintain:
 339-1               (1)  a pool, lake, or reservoir;
 339-2               (2)  a well;
 339-3               (3)  a dam; and
 339-4               (4)  any water treatment and distribution facility as
 339-5   may be required.
 339-6         (c)  The county must comply with the applicable water permit
 339-7   provisions of Title 2, Water Code.  (V.A.C.S. Art. 2352e, Sec. 2
 339-8   (part).)
 339-9         Sec. 1477.054.  LIMITATION ON COST.  (a)  The total cost of
339-10   projects undertaken by the county under this subchapter may not
339-11   exceed $250,000, excluding interest.
339-12         (b)  The par value of bonds issued under this subchapter for
339-13   a project may not exceed $250,000.  (V.A.C.S. Art. 2352e, Secs. 2
339-14   (part), 4(e) (part).)
339-15         Sec. 1477.055.  AUTHORITY TO ISSUE BONDS AND IMPOSE AD
339-16   VALOREM TAXES.  (a)  To pay the costs of a project, the county may
339-17   issue bonds payable from and secured by a pledge of the net revenue
339-18   of the project.  The cost of a project may include:
339-19               (1)  legal, fiscal, and engineering expenses; and
339-20               (2)  interest during the construction of the project.
339-21         (b)  If provided in the order issuing a bond, bonds issued
339-22   under Subsection (a) may be additionally secured by an ad valorem
339-23   tax imposed under Section 9, Article VIII, Texas Constitution.  If
339-24   the county places any part of the ad valorem tax in a permanent
339-25   improvement fund, only the ad valorem taxes in that fund may be
339-26   used as the additional security.
339-27         (c)  Before a county may issue bonds under Subsection (a) to
 340-1   pay for a project, the bonds must be approved in an election held
 340-2   under Section 1477.057.  If an ad valorem tax is to be imposed
 340-3   under Subsection (b) to secure bonds, the tax must also be approved
 340-4   at the election held to approve the issuance of the bonds.
 340-5   (V.A.C.S. Art. 2352e, Sec. 4(a) (part).)
 340-6         Sec. 1477.056.  AMOUNT OF TAX.  (a)  If bonds issued under
 340-7   this subchapter are to be secured by a tax, the commissioners court
 340-8   shall impose a tax sufficient to pay the interest on the bonds as
 340-9   the interest accrues and the principal as the principal matures.
340-10         (b)  The order authorizing the issuance of bonds may provide
340-11   that the amount of tax to be collected each year may be reduced to
340-12   the extent money is available from pledged project revenue for the
340-13   payment of interest and principal.  (V.A.C.S. Art. 2352e, Sec.
340-14   4(a) (part).)
340-15         Sec. 1477.057.  ELECTION.  (a)  Before construction of a
340-16   project may begin and before a project may be improved, repaired,
340-17   or extended under Section 1477.063, the commissioners court by
340-18   resolution must order an election.
340-19         (b)  In addition to the requirements provided by Chapter 3,
340-20   Election Code, the election order must:
340-21               (1)  describe the proposed project;
340-22               (2)  state the amount, rate of interest, and maturity
340-23   dates of bonds to be issued to pay for the proposed project;
340-24               (3)  state whether a tax will be imposed to redeem the
340-25   bonds; and
340-26               (4)  state the amount of any tax to be imposed to
340-27   redeem the bonds.
 341-1         (c)  If a majority of the voters in the county approve the
 341-2   issuance of bonds under this subchapter, the commissioners court
 341-3   shall issue the bonds as provided by this subchapter.  (V.A.C.S.
 341-4   Art. 2352e, Secs. 4(d) (part), (e) (part).)
 341-5         Sec. 1477.058.  CONTENTS OF ORDER AUTHORIZING BONDS.  The
 341-6   order authorizing issuance of bonds under this subchapter to pay
 341-7   for a project may contain:
 341-8               (1)  reasonable and proper provisions for protecting
 341-9   and enforcing the rights and remedies of the bondholders, including
341-10   covenants that state the duties of the county relating to:
341-11                     (A)  the acquisition of property for the project;
341-12                     (B)  the construction, maintenance, operation,
341-13   repair, and insurance of the project; and
341-14                     (C)  the custody, protection, and application of
341-15   all money related to the project;
341-16               (2)  a statement of the rights and remedies of the
341-17   bondholders; and
341-18               (3)  other provisions that the commissioners court
341-19   considers reasonable and proper for the security of the
341-20   bondholders, including covenants prescribing:
341-21                     (A)  each event that constitutes a default; and
341-22                     (B)  the rights, liabilities, powers, and duties
341-23   that arise on breach by the county of a duty or obligation.
341-24   (V.A.C.S. Art. 2352e, Sec. 4(f) (part).)
341-25         Sec. 1477.059.  MATURITY.  A bond issued under this
341-26   subchapter must mature not later than 40 years after its date.
341-27   (V.A.C.S. Art. 2352e, Sec. 4(f) (part).)
 342-1         Sec. 1477.060.  SIGNATURES; REGISTRATION BY COUNTY TREASURER.
 342-2   (a)  A bond issued under this subchapter must be:
 342-3               (1)  signed by the county judge; and
 342-4               (2)  attested by the county clerk.
 342-5         (b)  The county treasurer shall register a bond issued under
 342-6   this subchapter but is not required to sign the bond.  (V.A.C.S.
 342-7   Art. 2352e, Sec. 6 (part).)
 342-8         Sec. 1477.061.  SALE OF BONDS.  The commissioners court shall
 342-9   determine the manner of sale of bonds issued under this subchapter.
342-10   (V.A.C.S. Art. 2352e, Sec. 4(f) (part).)
342-11         Sec. 1477.062.  USE OF BOND PROCEEDS.  (a)  The proceeds of
342-12   bonds issued under this subchapter may only be used to pay the cost
342-13   of the project for which the bonds were issued.
342-14         (b)  The county shall disburse the proceeds of the bonds in
342-15   accordance with any restrictions provided in the order authorizing
342-16   the bonds.
342-17         (c)  The bondholders have a lien on the proceeds until the
342-18   proceeds are applied.
342-19         (d)  The bond proceeds, pending their use for the
342-20   construction of the project, may be invested in direct obligations
342-21   of the United States having maturities not more than 91 days from
342-22   the date of investment.  (V.A.C.S. Art. 2352e, Sec. 4(f) (part).)
342-23         Sec. 1477.063.  ADDITIONAL BONDS.  (a)  Unless otherwise
342-24   provided in the bond order, if the proceeds of bonds issued to pay
342-25   for a project are not sufficient to pay the cost of the project,
342-26   the county may issue additional bonds under this subchapter not to
342-27   exceed the amount of the deficit.
 343-1         (b)  If permitted by the order originally authorizing bonds
 343-2   to pay for a project, the county may issue additional bonds for
 343-3   improving, repairing, or extending the project.
 343-4         (c)  Bonds issued under Subsection (b):
 343-5               (1)  may be payable:
 343-6                     (A)  solely from a pledge of the net revenue of
 343-7   the project; or
 343-8                     (B)  from the net revenue of the project and the
 343-9   imposition of an ad valorem tax; and
343-10               (2)  must be approved at an election in the same manner
343-11   as bonds originally issued to pay the costs of the project.
343-12   (V.A.C.S.  Art. 2352e, Secs. 4(f) (part), 8.)
343-13         Sec. 1477.064.  RATES AND CHARGES.  (a)  If bonds issued
343-14   under this subchapter are secured solely by a pledge of net revenue
343-15   of the project, the commissioners court shall contract for and
343-16   impose rates and charges for water supplied by the project that
343-17   will be sufficient to:
343-18               (1)  operate and maintain the project;
343-19               (2)  pay when due the principal of and interest on the
343-20   bonds; and
343-21               (3)  establish any reserves provided in the order
343-22   authorizing the issuance of the bonds.
343-23         (b)  A bond secured solely by a pledge of net revenue:
343-24               (1)  is not a debt of the county issuing the bond;
343-25               (2)  may be a charge only on pledged revenue of a
343-26   project;
343-27               (3)  may not be included in determining the power of
 344-1   the county to issue bonds or incur other debt for any purpose
 344-2   authorized by law; and
 344-3               (4)  must contain the following provision:  "The holder
 344-4   of this bond is not entitled to demand payment of this obligation
 344-5   out of any money raised by taxation." (V.A.C.S. Art. 2352e, Secs.
 344-6   4(b), 5.)
 344-7         Sec. 1477.065.  TAXES PLEDGED TO PAY BONDS.  A bond issued
 344-8   under this subchapter that is secured wholly or partially by a
 344-9   pledge of a tax imposed under Section 9, Article VIII, Texas
344-10   Constitution, is considered to be payable wholly from that tax for
344-11   the purpose of determining the availability of taxing power of the
344-12   county to pay an obligation that is payable from that tax.
344-13   (V.A.C.S. Art. 2352e, Sec. 12.)
344-14         Sec. 1477.066.  BONDHOLDER'S RIGHT TO MANDAMUS.  (a)  The
344-15   holder of a bond issued under this subchapter is entitled, by
344-16   mandamus or other proceedings in court, to enforce the holder's
344-17   rights against:
344-18               (1)  the county;
344-19               (2)  the county's employees and agents; and
344-20               (3)  the employees of the county's agents.
344-21         (b)  A bondholder's rights include the right to require the
344-22   county to:
344-23               (1)  impose and collect sufficient rates and charges to
344-24   carry out the agreements contained in the bond order; and
344-25               (2)  perform all agreements and covenants contained in
344-26   the bond order and the duties arising from those agreements and
344-27   covenants.  (V.A.C.S. Art. 2352e, Sec. 11.)
 345-1         Sec. 1477.067.  REFUNDING BONDS.  Bonds issued to refund
 345-2   bonds issued under this subchapter may only be:
 345-3               (1)  exchanged for bonds being refunded; or
 345-4               (2)  sold and delivered to provide money to pay matured
 345-5   or redeemable bonds maturing or redeemable not later than six
 345-6   months after the date of issuance of the refunding bonds.
 345-7   (V.A.C.S. Art. 2352e, Sec. 9 (part).)
 345-8         Sec. 1477.068.  EXEMPTION FROM ASSESSMENT OR TAXATION.
 345-9   (a)  A county is not required to pay any assessment on a project or
345-10   any part of a project.
345-11         (b)  A bond issued under this subchapter, the transfer of the
345-12   bond, and the income from the bond, including any profit made from
345-13   the sale of the bond, are exempt from taxation by this state or by
345-14   a political subdivision of this state.  (V.A.C.S.  Art. 2352e, Sec.
345-15   14 (part).)
345-16         Sec. 1477.069.  COUNTY USE OF WATER.  A county shall pay for
345-17   water used by the county for its own facilities from general funds
345-18   of the county legally available for that purpose, and free service
345-19   is prohibited.  (V.A.C.S. Art. 2352e, Sec. 4(c).)
345-20         Sec. 1477.070.  SALE OF WATER NOT NEEDED FOR COUNTY PURPOSES.
345-21   (a)  The commissioners court may sell, deliver, and distribute any
345-22   water of the project that is not needed for county purposes to a
345-23   municipal corporation or political subdivision of this state, or an
345-24   individual, corporation, or company under terms that the court
345-25   determines are in the best interests of the county.
345-26         (b)  The cost of supplying water from a project under
345-27   Subsection (a), including any increase in the cost of acquisition,
 346-1   storage, treatment, and distribution facilities, is considered a
 346-2   cost of the project.
 346-3         (c)  The commissioners court may not sell water under
 346-4   Subsection (a):
 346-5               (1)  if an adequate public water supply is available to
 346-6   the municipal corporation, political subdivision, individual,
 346-7   corporation, or company at the time the law codified by this
 346-8   subchapter was adopted by the county; or
 346-9               (2)  for irrigation purposes.  (V.A.C.S. Art. 2352e,
346-10   Sec.  3.)
346-11         Sec. 1477.071.  EMINENT DOMAIN.  (a)  In exercising any power
346-12   granted by this subchapter, a county may acquire real property and
346-13   easements by the exercise of the power of eminent domain in
346-14   accordance with Chapter 21, Property Code.
346-15         (b)  The commissioners court shall determine the amount and
346-16   character of interest in real property and easements to be acquired
346-17   by the exercise of the power of eminent domain.  (V.A.C.S.
346-18   Art. 2352e, Sec. 7 (part).)
346-19         Sec. 1477.072.  RELOCATION OR ALTERATION EXPENSE.  If a
346-20   county, in the exercise of a power granted by this subchapter,
346-21   including the power of eminent domain or the power of relocation,
346-22   makes necessary the relocation, rerouting, or alteration of the
346-23   construction of a highway, railroad, electric transmission line,
346-24   pipeline, or telephone or telegraph property or facility, the
346-25   relocation, rerouting, or alteration of construction must be
346-26   accomplished at the sole expense of the county.  In this section,
346-27   "sole expense" means the actual cost of the relocation, rerouting,
 347-1   or alteration of construction to provide comparable replacement
 347-2   without enhancement of the facility, after deduction of the net
 347-3   salvage value derived from the old facility.  (V.A.C.S. Art. 2352e,
 347-4   Sec. 7 (part).)
 347-5         Sec. 1477.073.  ESSENTIAL GOVERNMENTAL FUNCTION.  A county,
 347-6   in accomplishing the purposes of this subchapter, is performing an
 347-7   essential governmental function.  (V.A.C.S. Art. 2352e, Sec. 14
 347-8   (part).)
 347-9           (Sections 1477.074-1477.100 reserved for expansion)
347-10         SUBCHAPTER C.  NATURAL GAS SYSTEM FOR COUNTY BUILDINGS
347-11                           IN CERTAIN COUNTIES
347-12         Sec. 1477.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
347-13   applies only to a county in which:
347-14               (1)  the commissioners court adopts this subchapter by
347-15   an order approved by a majority vote of the court's members; and
347-16               (2)  the county seat is an unincorporated community or
347-17   city with a population of more than 5,000, according to the most
347-18   recent federal census, on the date on which the order is adopted.
347-19   (V.A.C.S. Art. 2372q, Sec. 1.)
347-20         Sec. 1477.102.  AUTHORITY TO ACQUIRE NATURAL GAS SYSTEM.  The
347-21   commissioners court of the county may purchase or construct a
347-22   natural gas system for supplying natural gas to county buildings
347-23   adequately and dependably.  (V.A.C.S. Art. 2372q, Sec. 2 (part).)
347-24         Sec. 1477.103.  NATURAL GAS SYSTEM FACILITIES.  The county
347-25   may construct, repair, and maintain natural gas supply or
347-26   distribution facilities as required to supply natural gas to county
347-27   buildings.  (V.A.C.S. Art. 2372q, Sec. 2 (part).)
 348-1         Sec. 1477.104.  AUTHORITY TO ISSUE BONDS.  To pay the cost of
 348-2   purchasing or constructing a natural gas system under this
 348-3   subchapter, the county may issue bonds payable from and secured by
 348-4   a pledge of the net revenue of the system.  The cost of the system
 348-5   may include:
 348-6               (1)  legal, fiscal, and engineering expenses;
 348-7               (2)  interest that accrues during the construction of
 348-8   the system; and
 348-9               (3)  the cost of supplying gas under Section 1477.119,
348-10   including any increase in the cost of distribution lines or
348-11   facilities.  (V.A.C.S. Art. 2372q, Secs. 3 (part), 4(a).)
348-12         Sec. 1477.105.  BONDS NOT PAYABLE FROM TAXES.  (a)  A bond
348-13   issued under this subchapter:
348-14               (1)  is not a debt of the county;
348-15               (2)  may be a charge only on the revenue pledged for
348-16   the payment of the bond; and
348-17               (3)  may not be included in determining the power of
348-18   the county to issue bonds or incur other indebtedness for any
348-19   purpose authorized by law.
348-20         (b)  Each bond issued under this subchapter must contain the
348-21   following provision:  "The holder of this obligation is not
348-22   entitled to demand payment of this obligation from any money raised
348-23   by taxation."  (V.A.C.S. Art. 2372q, Sec. 5.)
348-24         Sec. 1477.106.  NOTICE OF INTENTION TO ISSUE BONDS.  (a)  The
348-25   commissioners court of the county may not authorize bonds under
348-26   this subchapter until the court gives notice of its intention to
348-27   issue the bonds.
 349-1         (b)  The notice must state, as to the proposed bonds:
 349-2               (1)  the maximum amount of the issue;
 349-3               (2)  the maximum interest rate;
 349-4               (3)  the maximum maturity; and
 349-5               (4)  the time and place at which the court intends to
 349-6   authorize the bonds.
 349-7         (c)  The notice must be published in a newspaper of general
 349-8   circulation in the county once a week for two consecutive weeks,
 349-9   with the first publication being before the 14th day before the
349-10   date set for authorization of the bonds.
349-11         (d)  The commissioners court may authorize the bonds at the
349-12   time and place specified in the notice except as provided by
349-13   Section 1477.107.  (V.A.C.S. Art. 2372q, Sec. 10 (part).)
349-14         Sec. 1477.107.  ELECTION.  (a)  If, before the bonds are
349-15   authorized, the commissioners court receives a petition requesting
349-16   an election on the issuance of the bonds that is signed by more
349-17   than 10 percent of the county's registered voters who are resident
349-18   owners of taxable property in the county, the court may not proceed
349-19   unless a proposition for the issuance of the bonds is approved at
349-20   an election held for that purpose.
349-21         (b)  The Election Code applies to an election under this
349-22   subchapter except as otherwise provided by this subchapter.
349-23         (c)  In addition to the notice required by Section 4.003,
349-24   Election Code, a substantial copy of the resolution calling the
349-25   election shall be published in a newspaper of general circulation
349-26   in the county once a week for two consecutive weeks, with the first
349-27   publication being before the 14th day before the date of the
 350-1   election.
 350-2         (d)  The election returns shall be made to the court not
 350-3   later than the fifth day after the date of the election.
 350-4         (e)  The court may authorize the bonds only if the issuance
 350-5   is approved by a majority of the qualified voters of the county
 350-6   voting in the election.  (V.A.C.S. Art. 2372q, Sec. 10 (part).)
 350-7         Sec. 1477.108.  CONTENTS OF ORDER AUTHORIZING BONDS.  An
 350-8   order authorizing the issuance of bonds under this subchapter may
 350-9   contain:
350-10               (1)  reasonable and proper provisions for protecting
350-11   and enforcing the rights or remedies of the bondholders, including
350-12   covenants that state the duties of the county relating to:
350-13                     (A)  the acquisition of property for the natural
350-14   gas system;
350-15                     (B)  the construction, maintenance, operation,
350-16   repair, and insurance of the system; and
350-17                     (C)  the custody, protection, and application of
350-18   all money related to the system;
350-19               (2)  a statement of the rights and remedies of the
350-20   bondholders; and
350-21               (3)  other provisions that the commissioners court
350-22   considers reasonable and proper for the security of the
350-23   bondholders, including covenants prescribing:
350-24                     (A)  each event that constitutes a default; and
350-25                     (B)  the rights, liabilities, powers, and duties
350-26   that arise on the breach by the county of a duty or obligation.
350-27   (V.A.C.S. Art. 2372q, Sec. 4(d) (part).)
 351-1         Sec. 1477.109.  MATURITY.  A bond issued under this
 351-2   subchapter must mature not later than 40 years after its date.
 351-3   (V.A.C.S. Art. 2372q, Sec. 4(d) (part).)
 351-4         Sec. 1477.110.  SIGNATURES; REGISTRATION BY COUNTY TREASURER.
 351-5   (a)  A bond issued under this subchapter must be signed by the
 351-6   county judge and attested by the county clerk.
 351-7         (b)  The county treasurer shall register a bond issued under
 351-8   this subchapter but is not required to sign the bond.  (V.A.C.S.
 351-9   Art. 2372q, Sec. 6 (part).)
351-10         Sec. 1477.111.  SALE OF BONDS.  The commissioners court shall
351-11   determine the manner of sale of bonds issued under this subchapter.
351-12   (V.A.C.S. Art. 2372q, Sec. 4(d) (part).)
351-13         Sec. 1477.112.  USE OF BOND PROCEEDS.  (a)  The county shall
351-14   disburse the proceeds of bonds issued under this subchapter in
351-15   accordance with any restrictions provided in the order authorizing
351-16   the bonds.
351-17         (b)  The bondholders have a lien on the proceeds until the
351-18   proceeds are applied.
351-19         (c)  The bond proceeds, pending their use for the
351-20   construction of the project, may be invested in direct obligations
351-21   of the United States having maturities not more than 91 days from
351-22   the date of investment.  (V.A.C.S. Art. 2372q, Sec. 4(d) (part).)
351-23         Sec. 1477.113.  ADDITIONAL BONDS.  (a)  Unless otherwise
351-24   provided by the order authorizing the bonds, if the proceeds of
351-25   bonds issued to pay for a natural gas system are not sufficient to
351-26   pay the cost of the system, the county may issue additional bonds
351-27   under this subchapter not to exceed the amount of the deficit.
 352-1         (b)  If permitted by the order originally authorizing bonds
 352-2   to pay for a natural gas system, the county may issue additional
 352-3   bonds for improving, repairing, or extending the system.  (V.A.C.S.
 352-4   Art. 2372q, Secs. 4(d) (part), 8.)
 352-5         Sec. 1477.114.  GAS RATES AND CHARGES.  The commissioners
 352-6   court shall contract for and impose rates and charges for gas
 352-7   supplied by the natural gas system that will be sufficient to:
 352-8               (1)  operate and maintain the system;
 352-9               (2)  pay when due the principal of and interest on any
352-10   bonds issued under this subchapter; and
352-11               (3)  establish any reserves provided for in the order
352-12   authorizing the issuance of the bonds.  (V.A.C.S. Art. 2372q, Sec.
352-13   4(b).)
352-14         Sec. 1477.115.  BONDHOLDER'S RIGHT TO MANDAMUS.  (a)  A
352-15   holder of a bond issued under this subchapter is entitled, by
352-16   mandamus or other proceedings in court, to enforce the holder's
352-17   rights against:
352-18               (1)  the county;
352-19               (2)  county employees and agents; and
352-20               (3)  the employees of the county's agents.
352-21         (b)  A bondholder's rights include the right to require the
352-22   county to:
352-23               (1)  impose and collect sufficient rates and charges to
352-24   carry out the agreements contained in the bond order; and
352-25               (2)  perform all agreements and covenants contained in
352-26   the bond order and the duties arising from those agreements or
352-27   covenants.  (V.A.C.S. Art. 2372q, Sec. 12.)
 353-1         Sec. 1477.116.  REFUNDING BONDS.  Bonds issued to refund
 353-2   bonds issued under this subchapter may only be:
 353-3               (1)  exchanged for bonds being refunded; or
 353-4               (2)  sold and delivered to provide money to pay matured
 353-5   or redeemable bonds maturing or redeemable not later than six
 353-6   months after the date of issuance of the refunding bonds.
 353-7   (V.A.C.S. Art. 2372q, Sec. 9 (part).)
 353-8         Sec. 1477.117.  EXEMPTION FROM ASSESSMENT OR TAXATION.  (a)
 353-9   A county is not required to pay any assessment on a natural gas
353-10   system or any part of a natural gas system acquired or constructed
353-11   under this subchapter.
353-12         (b)  A bond issued under this subchapter, a transfer of the
353-13   bond, and the income from the bond, including any profit made from
353-14   the sale of the bond, are exempt from taxation by this state or a
353-15   political subdivision of this state.  (V.A.C.S. Art. 2372q, Sec. 14
353-16   (part).)
353-17         Sec. 1477.118.  COUNTY USE OF GAS.  The county shall pay for
353-18   gas used by the county for its own facilities from general funds of
353-19   the county legally available for that purpose, and free service is
353-20   prohibited.  (V.A.C.S. Art. 2372q, Sec. 4(c).)
353-21         Sec. 1477.119.  SALE OF GAS NOT NEEDED FOR COUNTY PURPOSES.
353-22   The commissioners court may sell, deliver, and distribute natural
353-23   gas of a natural gas system purchased or constructed under this
353-24   subchapter that is not needed for county purposes to a municipal
353-25   corporation or political subdivision of this state, or an
353-26   individual, corporation, or company under terms that the court
353-27   determines are in the best interests of the county.  (V.A.C.S.
 354-1   Art. 2372q, Sec. 3 (part).)
 354-2         Sec. 1477.120.  EMINENT DOMAIN.  (a)  The county may not
 354-3   acquire a natural gas system or a facility of a natural gas system
 354-4   under this subchapter by the exercise of the power of eminent
 354-5   domain or exercise the power of eminent domain under this
 354-6   subchapter outside the county's boundaries.  The county may acquire
 354-7   land or an easement for a purpose authorized by this subchapter by
 354-8   the exercise of the power of eminent domain in the manner provided
 354-9   by Chapter 21, Property Code.
354-10         (b)  The commissioners court shall determine the amount of
354-11   and character of interest in the land or easement to be acquired by
354-12   the exercise of the power of eminent domain.  (V.A.C.S. Art. 2372q,
354-13   Secs. 2 (part), 7 (part).)
354-14         Sec. 1477.121.  RELOCATION OR ALTERATION EXPENSE.  If a
354-15   county, in the exercise of a power under this subchapter, including
354-16   the power of eminent domain or the power of relocation, makes
354-17   necessary the relocation or rerouting of, or alteration of the
354-18   construction of, a highway, railroad, electric transmission line or
354-19   pipeline, or telegraph or telephone property or facility, the
354-20   relocation or rerouting or alteration of construction must be
354-21   accomplished at the sole expense of the county.  (V.A.C.S.
354-22   Art. 2372q, Sec. 7 (part).)
354-23         Sec. 1477.122.  ESSENTIAL GOVERNMENTAL FUNCTION.  A county,
354-24   in accomplishing the purposes of this subchapter, is performing an
354-25   essential governmental function.  (V.A.C.S. Art. 2372q, Sec. 14
354-26   (part).)
354-27           (Sections 1477.123-1477.150 reserved for expansion)
 355-1         SUBCHAPTER D.  OBLIGATIONS FOR FIRE-FIGHTING EQUIPMENT 
 355-2         Sec. 1477.151.  AUTHORITY TO PURCHASE FIRE-FIGHTING
 355-3   EQUIPMENT.  The commissioners court of a county may purchase fire
 355-4   trucks and other fire-fighting equipment to be used for the
 355-5   protection and preservation of bridges, county shops, county
 355-6   warehouses, and other county property located in the county but
 355-7   outside the boundaries of municipalities.  (V.A.C.S.  Art. 2351a-4
 355-8   (part).)
 355-9         Sec. 1477.152.  AUTHORITY TO ISSUE OBLIGATIONS AND IMPOSE
355-10   TAXES.  (a)  The county may issue time warrants and bonds of the
355-11   county for a purchase under Section 1477.151 and may impose taxes
355-12   for the payment of those time warrants or bonds.  The county shall
355-13   deposit the taxes in the general fund of the county.
355-14         (b)  The time warrants or bonds must be authorized by a
355-15   majority of the qualified voters voting at an election held for
355-16   that purpose by the commissioners court.
355-17         (c)  The county must issue the time warrants or bonds and
355-18   impose taxes in compliance with Subtitles A and C.  (V.A.C.S.
355-19   Art. 2351a-4 (part).)
355-20         Sec. 1477.153.  LIMIT ON AMOUNT OF OBLIGATIONS.  A county may
355-21   issue time warrants or bonds under this subchapter only in an
355-22   amount that will at all times leave unencumbered taxes in an amount
355-23   sufficient to pay all current expenses from the county's general
355-24   fund.  (V.A.C.S. Art. 2351a-4 (part).)
355-25           (Sections 1477.154-1477.200 reserved for expansion)
355-26       SUBCHAPTER E.  CERTIFICATES OF INDEBTEDNESS FOR FIREFIGHTER
355-27                           TRAINING FACILITIES
 356-1         Sec. 1477.201.  AUTHORITY TO ISSUE CERTIFICATES OF
 356-2   INDEBTEDNESS.  The commissioners court of a county may issue
 356-3   certificates of indebtedness to acquire, construct, repair,
 356-4   renovate, improve, or equip firefighter training facilities for the
 356-5   county and to acquire property in connection with that purpose.
 356-6   (V.A.C.S. Art. 2351a-7, Sec. 1 (part).)
 356-7         Sec. 1477.202.  AUTHORITY TO IMPOSE AND PLEDGE AD VALOREM
 356-8   TAX.  The commissioners court shall impose and pledge annual county
 356-9   ad valorem taxes under Section 9, Article VIII, Texas Constitution,
356-10   in an amount sufficient to pay the principal of and interest on
356-11   certificates of indebtedness as they become due.  (V.A.C.S.
356-12   Art. 2351a-7, Sec. 1 (part).)
356-13         Sec. 1477.203.  LIMIT ON AMOUNT OF INDEBTEDNESS.  The
356-14   aggregate principal amount of certificates of indebtedness issued
356-15   by a county under this subchapter may not exceed $5 million.
356-16   (V.A.C.S. Art. 2351a-7, Sec. 1 (part).)
356-17         Sec. 1477.204.  ELECTION.  (a)  The commissioners court may
356-18   issue certificates of indebtedness under this subchapter only if
356-19   the certificates are approved by a majority of the qualified voters
356-20   voting at an election held for that purpose by the commissioners
356-21   court.
356-22         (b)  An election under this subchapter shall be held on the
356-23   next uniform election date authorized by Section 41.001, Election
356-24   Code, that occurs not earlier than the 20th day after the date on
356-25   which the election is called.
356-26         (c)  The commissioners court shall order the ballot at the
356-27   election to be printed to permit voting for or against the
 357-1   proposition:  "Issuing certificates of indebtedness by the county
 357-2   to acquire, purchase, construct, repair, renovate, improve, or
 357-3   equip firefighter training facilities or to purchase real or
 357-4   personal property in connection with those facilities."  (V.A.C.S.
 357-5   Art. 2351a-7, Sec. 1 (part).)
 357-6         Sec. 1477.205.  MATURITY.  A certificate of indebtedness
 357-7   issued under this subchapter must mature not later than 40 years
 357-8   after its date.  (V.A.C.S. Art. 2351a-7, Sec. 1 (part).)
 357-9         Sec. 1477.206.  OPERATION OF FIREFIGHTER TRAINING FACILITIES.
357-10   (a)  The commissioners court may:
357-11               (1)  operate and maintain the county's firefighter
357-12   training facilities; and
357-13               (2)  set and collect charges for:
357-14                     (A)  services performed at those facilities; and
357-15                     (B)  information furnished to others by the use
357-16   of those facilities.
357-17         (b)  The commissioners court shall pay the expenses of
357-18   operating and maintaining the county's firefighter training
357-19   facilities from:
357-20               (1)  charges collected under Subsection (a); and
357-21               (2)  any other available county funds.  (V.A.C.S.
357-22   Art. 2351a-7, Sec. 4.)
357-23           (Sections 1477.207-1477.250 reserved for expansion)
357-24          SUBCHAPTER F.  BONDS FOR SURVEYS, MAPS, AND PLATS IN
357-25               COUNTIES WITH POPULATION OF 500,000 OR MORE
357-26         Sec. 1477.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
357-27   applies only to a county with a population of 500,000 or more.
 358-1   (V.A.C.S. Art. 717l, Sec. 1 (part).)
 358-2         Sec. 1477.252.  AUTHORITY TO ISSUE BONDS AND IMPOSE TAXES.
 358-3   (a)  If the subdivisions of surveys in a county are irregularly
 358-4   numbered or if the blocks and subdivisions of municipalities in the
 358-5   county are not numbered or are irregularly numbered, causing
 358-6   difficulties for the county tax assessor-collector, the
 358-7   commissioners court of the county may:
 358-8               (1)  make a survey and acquire related maps and plats
 358-9   of blocks and subdivisions in the county; and
358-10               (2)  furnish to the county tax assessor-collector:
358-11                     (A)  block books showing the description of each
358-12   block and subdivision in the county;
358-13                     (B)  the names of the record owners of each
358-14   parcel of property in each block book, if known; and
358-15                     (C)  other information relating to Paragraphs (A)
358-16   and (B) that will assist in the performance of the duties of the
358-17   tax assessor-collector.
358-18         (b)  The commissioners court may issue bonds to pay the cost
358-19   of taking an action under Subsection (a).
358-20         (c)  The commissioners court may impose taxes under Section
358-21   9, Article VIII, Texas Constitution, to pay for bonds issued under
358-22   Subsection (b).  (V.A.C.S. Art. 717l, Secs. 1 (part), 2, 4 (part).)
358-23         Sec. 1477.253.  ELECTION PROPOSITION.  (a)  At an election to
358-24   approve the issuance of bonds under this subchapter, the
358-25   commissioners court may submit one or more separate propositions
358-26   for the issuance of bonds.
358-27         (b)  Each proposition submitted at a bond election under this
 359-1   subchapter may include one or more of the purposes authorized by
 359-2   Section 1477.252.  (V.A.C.S. Art. 717l, Sec. 3.)
 359-3         Sec. 1477.254.  BONDS OBLIGATION OF COUNTY.  (a)  A bond
 359-4   issued under this subchapter is an obligation of and a charge
 359-5   against the county issuing the bond.
 359-6         (b)  Except as provided by this subchapter, a county must
 359-7   issue bonds under this subchapter and impose taxes in compliance
 359-8   with applicable provisions of Subtitles A, C, and D.  (V.A.C.S.
 359-9   Art. 717l, Sec. 4 (part).)
359-10           (Sections 1477.255-1477.300 reserved for expansion)
359-11        SUBCHAPTER G.  REVENUE BONDS FOR IMPROVEMENTS TO ATTRACT
359-12                VISITORS OR TOURISTS IN CERTAIN COUNTIES
359-13         Sec. 1477.301.  APPLICABILITY OF SUBCHAPTER.  This subchapter
359-14   applies only to a county:
359-15               (1)  with a population of more than two million; or
359-16               (2)  with a population of more than 90,000 that borders
359-17   the United Mexican States other than a county that contains three
359-18   or more municipalities that each have a population of more than
359-19   17,500.  (V.A.C.S. Art. 2372d-8, Sec. 1.)
359-20         Sec. 1477.302.  AUTHORITY FOR VISITOR OR TOURIST ATTRACTIONS.
359-21   A county may establish, acquire, lease as lessor or lessee,
359-22   construct, improve, enlarge, equip, repair, operate, or maintain:
359-23               (1)  a public improvement or facility to attract
359-24   visitors or tourists to the county, including a civic center, a
359-25   civic center building, an auditorium, an exhibition hall, a
359-26   coliseum, stadium, or other sports facility; or
359-27               (2)  a parking facility located at or in the immediate
 360-1   vicinity of an improvement or facility described by Subdivision (1)
 360-2   to be used in connection with the improvement or facility for
 360-3   off-street parking or storage of motor vehicles or other
 360-4   conveyances.  (V.A.C.S. Art. 2372d-8, Sec. 2 (part).)
 360-5         Sec. 1477.303.  AUTHORITY TO ISSUE REVENUE BONDS.  The
 360-6   commissioners court of the county by order may issue revenue bonds
 360-7   to provide all or part of the money to establish, acquire,
 360-8   construct, improve, enlarge, equip, or repair a facility described
 360-9   by Section 1477.302.  (V.A.C.S. Art. 2372d-8, Secs. 3(a), (b)
360-10   (part).)
360-11         Sec. 1477.304.  PLEDGE OF REVENUE.  (a)  Bonds issued under
360-12   this subchapter must be secured by a pledge of and be payable from
360-13   all or a designated part of the revenue from the improvement or
360-14   facility for which the bonds are issued, as provided in the order
360-15   authorizing the bonds.
360-16         (b)  The pledge securing the bonds is inferior to any
360-17   previous pledge of the revenue for the payment of revenue bonds or
360-18   revenue refunding bonds that are outstanding.
360-19         (c)  A county that leases a facility described by Section
360-20   1477.302 as lessee may pledge all or part of the revenue from the
360-21   facility to the lease payments.  (V.A.C.S. Art. 2372d-8, Secs. 3(b)
360-22   (part), (d).)
360-23         Sec. 1477.305.  LIEN ON FACILITY.  Subject to any limitations
360-24   contained in previous pledges, in addition to pledging the revenue
360-25   from the improvement or facility, the commissioners court may give
360-26   a lien on the physical property acquired with the bond proceeds.
360-27   (V.A.C.S. Art. 2372d-8, Sec. 3(b) (part).)
 361-1         Sec. 1477.306.  BONDS NOT PAYABLE FROM TAXATION; EXCEPTION.
 361-2   (a)  The owner or holder of a bond issued under this subchapter is
 361-3   not entitled to demand payment of the principal of or interest on
 361-4   the bond from money raised by taxation.
 361-5         (b)  Subsection (a) does not apply to a demand for payment
 361-6   from hotel occupancy taxes that are pledged under Chapter 352, Tax
 361-7   Code, to the payment of the bond.  (V.A.C.S. Art. 2372d-8, Sec. 8.)
 361-8         Sec. 1477.307.  CONTENTS OF ORDER AUTHORIZING BONDS.  (a)
 361-9   The order of the commissioners court authorizing the issuance of
361-10   bonds under this subchapter may provide for the flow of funds and
361-11   the establishment and maintenance of an interest and sinking fund,
361-12   a reserve fund, or other fund.
361-13         (b)  The order may:
361-14               (1)  prohibit the issuance of additional bonds or other
361-15   obligations payable from the pledged revenue; or
361-16               (2)  reserve the right of the commissioners court,
361-17   subject to any condition in the order, to issue additional bonds
361-18   payable from the pledged revenue that are on a parity with or
361-19   subordinate to the lien and pledge on the revenue that supports the
361-20   bonds issued under the order.
361-21         (c)  The commissioners court may include in the order any
361-22   other provision or covenant, including a covenant with respect to
361-23   the bonds, the use or pledge of revenue, or the operation, lease,
361-24   or maintenance of the improvement or facility.  (V.A.C.S.
361-25   Art. 2372d-8, Sec. 9 (part).)
361-26         Sec. 1477.308.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
361-27   commissioners court may adopt and have executed any other
 362-1   proceeding or instrument necessary or convenient to the issuance of
 362-2   bonds under this subchapter.  (V.A.C.S. Art. 2372d-8, Sec. 9
 362-3   (part).)
 362-4         Sec. 1477.309.  MATURITY.  A bond issued under this
 362-5   subchapter must mature not later than 40 years after its date.
 362-6   (V.A.C.S. Art. 2372d-8, Secs. 11 (part), 12 (part).)
 362-7         Sec. 1477.310.  SIGNATURES.  A bond issued under this
 362-8   subchapter must be:
 362-9               (1)  signed by the county judge; and
362-10               (2)  countersigned by the county clerk.  (V.A.C.S.
362-11   Art. 2372d-8, Sec. 11 (part).)
362-12         Sec. 1477.311.  SALE OF BONDS.  The commissioners court may
362-13   sell bonds issued under this subchapter under terms the court
362-14   determines to be the most advantageous and reasonably obtainable.
362-15   (V.A.C.S. Art. 2372d-8, Sec. 11 (part).)
362-16         Sec. 1477.312.  USE OF BOND PROCEEDS.  (a)  From the proceeds
362-17   of bonds issued under this subchapter, the county may appropriate
362-18   or set aside amounts to:
362-19               (1)  pay interest expected to accrue during the
362-20   construction period;
362-21               (2)  deposit into a reserve fund, as provided in the
362-22   order authorizing the bonds; and
362-23               (3)  pay all expenses incurred in the issuance, sale,
362-24   and delivery of the bonds.
362-25         (b)  The bond proceeds, until they are needed to implement
362-26   the purpose for which the bonds were issued, may be invested in
362-27   direct obligations of the United States, placed on time deposit, or
 363-1   both.  (V.A.C.S. Art. 2372d-8, Sec. 10 (part).)
 363-2         Sec. 1477.313.  INVESTMENT OF FUNDS.  Money in an interest
 363-3   and sinking fund, reserve fund, or any other fund established or
 363-4   provided for in the bond order may be invested in the manner and in
 363-5   the securities as provided in the bond order.  (Art. 2372d-8, Sec.
 363-6   10 (part).)
 363-7         Sec. 1477.314.  CHARGES FOR SERVICES.  The commissioners
 363-8   court shall impose and collect charges for the use of an
 363-9   improvement or facility the revenue of which is pledged to secure
363-10   bonds issued under this subchapter, and for services provided in
363-11   connection with that use, in amounts at least sufficient to comply
363-12   with each covenant or provision in the order authorizing the
363-13   issuance of the bonds.  (V.A.C.S. Art. 2372d-8, Sec. 3(c).)
363-14         Sec. 1477.315.  REFUNDING BONDS.  (a)  A county by order may
363-15   issue revenue refunding bonds similarly secured to refund either
363-16   original bonds or revenue refunding bonds previously issued by the
363-17   county under this subchapter.
363-18         (b)  The refunding bonds shall be executed as provided by
363-19   this subchapter for original bonds.
363-20         (c)  The comptroller shall register the refunding bonds on
363-21   the surrender and cancellation of the bonds to be refunded.
363-22         (d)  In lieu of issuing bonds to be registered on the
363-23   surrender and cancellation of the bonds to be refunded, the county,
363-24   in the order authorizing the issuance of the refunding bonds, may
363-25   provide for the sale of the refunding bonds and the deposit of the
363-26   proceeds in the place bonds to be refunded are payable.  In that
363-27   case, the refunding bonds may be issued in an amount sufficient to
 364-1   pay the principal of and interest on the bonds to be refunded to
 364-2   their option or maturity date, and the comptroller shall register
 364-3   the refunding bonds without the surrender and cancellation of the
 364-4   bonds to be refunded.  (V.A.C.S. Art. 2372d-8, Sec. 12 (part).)
 364-5           (Sections 1477.316-1477.350 reserved for expansion)
 364-6      SUBCHAPTER H.  REVENUE ANTICIPATION NOTES IN CERTAIN COUNTIES
 364-7         Sec. 1477.351.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 364-8   applies only to a county that has a county auditor.  (V.A.C.S.
 364-9   Art. 1676c, Sec. 1 (part).)
364-10         Sec. 1477.352.  AUTHORITY TO ISSUE REVENUE ANTICIPATION
364-11   NOTES.  The county may issue revenue anticipation notes to pay for
364-12   current expenses of the county only if the county auditor:
364-13               (1)  recommends that action; and
364-14               (2)  identifies the revenue anticipated to be used for
364-15   repayment of the notes.  (V.A.C.S. Art. 1676c, Secs. 1 (part), 2
364-16   (part).)
364-17         Sec. 1477.353.  LIMIT ON AMOUNT OF NOTES.  (a)  The total
364-18   amount of revenue anticipation notes issued by the county under
364-19   this subchapter may not exceed 50 percent of the amount of taxes
364-20   levied by the county for the year in which the notes are issued.
364-21         (b)  For purposes of Subsection (a), the total amount of
364-22   revenue anticipation notes includes the:
364-23               (1)  principal of the notes;
364-24               (2)  interest to be paid on the notes; and
364-25               (3)  cost of issuance of the notes.  (V.A.C.S.
364-26   Art. 1676c, Sec. 1 (part).)
364-27         Sec. 1477.354.  MATURITY.  (a)  A revenue anticipation note
 365-1   issued under this subchapter must mature not later than the last
 365-2   day of the fiscal year in which the note is issued, except as
 365-3   provided by Subsection (b).
 365-4         (b)  A revenue anticipation note issued under this subchapter
 365-5   may mature not later than the last day of the first quarter of the
 365-6   fiscal year following the fiscal year in which the note is issued
 365-7   if the revenue dedicated to retire the note has accrued but has not
 365-8   been received by the county in the fiscal year in which the note is
 365-9   issued.  (V.A.C.S. Art. 1676c, Sec. 1 (part).)
365-10         Sec. 1477.355.  REVENUE AVAILABLE FOR PAYMENT OF NOTES.  A
365-11   county may use any revenue of the county not otherwise dedicated or
365-12   restricted, including ad valorem taxes, for the payment of a
365-13   revenue anticipation note issued under this subchapter.  (V.A.C.S.
365-14   Art. 1676c, Sec. 2 (part).)
365-15           (Sections 1477.356-1477.400 reserved for expansion)
365-16        SUBCHAPTER I.  OBLIGATIONS IN COUNTIES WITH POPULATION OF
365-17                             LESS THAN 8,600
365-18         Sec. 1477.401.  APPLICABILITY OF SUBCHAPTER.  This subchapter
365-19   applies only to a county with a population of less than 8,600.
365-20   (V.A.C.S. Art. 1644c-1, Sec. 1 (part).)
365-21         Sec. 1477.402.  AUTHORITY TO BORROW.  (a)  The county may
365-22   borrow money under this subchapter from any source.
365-23         (b)  The total combined principal amount borrowed under this
365-24   subchapter may not exceed $200,000.  (V.A.C.S. Art. 1644c-1, Sec. 1
365-25   (part).)
365-26         Sec. 1477.403.  AUTHORITY TO ISSUE OBLIGATIONS.  The
365-27   commissioners court of the county may issue time warrants or other
 366-1   obligations of the county in evidence of money borrowed under
 366-2   Section 1477.402.  (V.A.C.S. Art. 1644c-1, Secs. 2 (part), 3
 366-3   (part).)
 366-4         Sec. 1477.404.  AUTHORITY TO IMPOSE AND PLEDGE TAXES AND
 366-5   REVENUES.  The county may impose taxes and may pledge taxes and
 366-6   other revenue of the county for the payment of money borrowed under
 366-7   Section 1477.402.  (V.A.C.S.  Art. 1644c-1, Sec. 2 (part).)
 366-8         Sec. 1477.405.  MATURITY.  A time warrant or obligation
 366-9   issued under this subchapter must be payable within 10 years.
366-10   (V.A.C.S. Art. 1644c-1, Sec. 2 (part).)
366-11         Sec. 1477.406.  SIGNATURES.  A time warrant or obligation
366-12   issued under this subchapter must be signed by the county judge and
366-13   the county clerk.  (V.A.C.S. Art. 1644c-1, Sec. 4.)
366-14         Sec. 1477.407.  VALIDITY OF OBLIGATION.  A time warrant or
366-15   other obligation that is issued and signed in compliance with this
366-16   subchapter is a valid obligation of the county.  (V.A.C.S.
366-17   Art. 1644c-1, Sec. 5.)
366-18               (Chapters 1478-1500 reserved for expansion)
366-19           SUBTITLE J.  SPECIFIC AUTHORITY FOR MUNICIPALITIES
366-20                           TO ISSUE SECURITIES
366-21           CHAPTER 1501.  OBLIGATIONS FOR MUNICIPAL UTILITIES
366-22             SUBCHAPTER A.  REVENUE BONDS FOR CERTAIN SEWAGE
366-23                           DISPOSAL FACILITIES
366-24   Sec. 1501.001.  APPLICABILITY OF SUBCHAPTER
366-25   Sec. 1501.002.  AUTHORITY TO ISSUE BONDS
366-26   Sec. 1501.003.  PLEDGE OF REVENUE
366-27   Sec. 1501.004.  AUTHORITY TO ISSUE ADDITIONAL BONDS
 367-1   Sec. 1501.005.  CONTRACTS
 367-2   Sec. 1501.006.  RATES FOR SERVICE
 367-3   Sec. 1501.007.  OTHER LAW APPLICABLE; ELECTION NOT REQUIRED
 367-4           (Sections 1501.008-1501.050 reserved for expansion)
 367-5         SUBCHAPTER B.  APPLICATION OF UTILITY SYSTEM REVENUE TO
 367-6                          BONDED DEBT ON SYSTEM
 367-7   Sec. 1501.051.  AUTHORITY TO USE UTILITY REVENUE FOR SINKING
 367-8                     FUND OR INTEREST PAYMENTS
 367-9   Sec. 1501.052.  EFFECT ON TAXES
367-10           (Sections 1501.053-1501.100 reserved for expansion)
367-11             SUBCHAPTER C.  REVENUE BONDS TO FINANCE CERTAIN
367-12                  TEXAS-NEW MEXICO ELECTRIC PROPERTIES
367-13   Sec. 1501.101.  AUTHORITY TO ACQUIRE AND OPERATE TEXAS-NEW
367-14                     MEXICO ELECTRIC PLANT AND SYSTEM
367-15   Sec. 1501.102.  AUTHORITY TO ISSUE REVENUE BONDS
367-16   Sec. 1501.103.  AUTHORITY TO SELL ELECTRICITY OF PLANT
367-17                     AND SYSTEM
367-18           (Sections 1501.104-1501.150 reserved for expansion)
367-19         SUBCHAPTER D.  CERTIFICATES OF INDEBTEDNESS TO FINANCE
367-20        JUDGMENTS OR SETTLEMENTS RELATED TO MUNICIPAL NATURAL GAS
367-21                                 SYSTEM
367-22   Sec. 1501.151.  AUTHORITY TO ISSUE CERTIFICATES OF
367-23                     INDEBTEDNESS
367-24   Sec. 1501.152.  NOTICE OF INTENTION TO ISSUE CERTIFICATES
367-25                     OF INDEBTEDNESS
367-26   Sec. 1501.153.  PETITION; ELECTION
367-27   Sec. 1501.154.  MATURITY
 368-1   Sec. 1501.155.  SIGNATURES; SEAL
 368-2   Sec. 1501.156.  SALE OF CERTIFICATES
 368-3   Sec. 1501.157.  USE OF PROCEEDS
 368-4   Sec. 1501.158.  IMPOSITION OF AD VALOREM TAX
 368-5           (Sections 1501.159-1501.200 reserved for expansion)
 368-6            SUBCHAPTER E.  BONDS FOR IMPROVEMENT OF WATER AND
 368-7           SEWER SYSTEMS IN MUNICIPALITIES WITH POPULATION OF
 368-8                            MORE THAN 275,000
 368-9   Sec. 1501.201.  APPLICABILITY OF SUBCHAPTER
368-10   Sec. 1501.202.  DEFINITIONS
368-11   Sec. 1501.203.  AUTHORITY TO ISSUE BONDS
368-12   Sec. 1501.204.  PLEDGE OF REVENUE
368-13   Sec. 1501.205.  NOTICE OF INTENTION TO ISSUE BONDS
368-14   Sec. 1501.206.  PETITION; ELECTION
368-15   Sec. 1501.207.  SALE OF DISTRICT PROPERTY
368-16   Sec. 1501.208.  INTEREST AND SINKING FUND OF DISTRICT
368-17   Sec. 1501.209.  INVESTMENT OF MONEY IN INTEREST AND SINKING
368-18                     FUND
368-19   Sec. 1501.210.  PAYMENT OF OUTSTANDING BONDS
368-20   Sec. 1501.211.  ORDINANCE SPECIFYING DATE OF PASSAGE OF
368-21                     TITLE; ABOLITION OF DISTRICT
368-22   Sec. 1501.212.  OPERATION AND MANAGEMENT OF PROPERTIES
368-23   Sec. 1501.213.  SEGREGATION OF PROPERTIES
368-24           (Sections 1501.214-1501.250 reserved for expansion)
368-25       SUBCHAPTER F.  ALTERNATIVE WATER SUPPLY FINANCING PROCEDURE
368-26         FOR MUNICIPALITIES WITH POPULATION OF MORE THAN 275,000
368-27   Sec. 1501.251.  APPLICABILITY OF SUBCHAPTER
 369-1   Sec. 1501.252.  ALTERNATIVE FINANCING PROCEDURE
 369-2   Sec. 1501.253.  WATER SUPPLY PROJECT OWNERSHIP AND
 369-3                     RESPONSIBILITIES
 369-4   Sec. 1501.254.  ORDINANCE AUTHORIZING AND ISSUANCE OF BONDS
 369-5   Sec. 1501.255.  NOTICE OF INTENTION TO ISSUE BONDS
 369-6   Sec. 1501.256.  PETITION; ELECTION
 369-7   Sec. 1501.257.  MATURITY
 369-8   Sec. 1501.258.  SIGNATURES
 369-9   Sec. 1501.259.  SALE OF BONDS
369-10   Sec. 1501.260.  INTERIM BONDS
369-11   Sec. 1501.261.  RATES, TOLLS, AND CHARGES
369-12   Sec. 1501.262.  DEPOSIT AND USE OF BOND PROCEEDS
369-13   Sec. 1501.263.  REFUNDING BONDS
369-14   Sec. 1501.264.  CONFLICT WITH OTHER LAW
369-15           CHAPTER 1501.  OBLIGATIONS FOR MUNICIPAL UTILITIES
369-16             SUBCHAPTER A.  REVENUE BONDS FOR CERTAIN SEWAGE
369-17                           DISPOSAL FACILITIES
369-18         Sec. 1501.001.  APPLICABILITY OF SUBCHAPTER.  This subchapter
369-19   applies only to a municipality that owns a sewer system and
369-20   disposal plant that serves:
369-21               (1)  other municipalities; and
369-22               (2)  territory and military establishments outside the
369-23   municipal boundaries.  (V.A.C.S. Art. 1118s, Sec. 1.)
369-24         Sec. 1501.002.  AUTHORITY TO ISSUE BONDS.  A municipality by
369-25   ordinance may issue bonds to finance the purchase or construction
369-26   of an additional sewage disposal facility.  (V.A.C.S. Art. 1118s,
369-27   Sec. 2 (part).)
 370-1         Sec. 1501.003.  PLEDGE OF REVENUE.  (a)  A municipality may
 370-2   secure bonds issued under this subchapter by a pledge of the net
 370-3   revenue from sewer service provided outside the municipal
 370-4   boundaries.
 370-5         (b)  Bonds issued under this subchapter may be additionally
 370-6   secured by a pledge of all or part of the net revenue from sewer
 370-7   service provided inside the municipal boundaries.
 370-8         (c)  In the ordinance authorizing the issuance of bonds
 370-9   secured only by the net revenue from sewer service provided outside
370-10   the municipal boundaries, the municipality may:
370-11               (1)  specify each item of expense or portion of the
370-12   item to be deducted to compute that net revenue; or
370-13               (2)  prescribe another formula the governing body of
370-14   the municipality considers appropriate to compute that net revenue.
370-15   (V.A.C.S. Art. 1118s, Sec. 2 (part).)
370-16         Sec. 1501.004.  AUTHORITY TO ISSUE ADDITIONAL BONDS.  In
370-17   issuing bonds under this subchapter, the municipality may reserve
370-18   the right to issue additional bonds to the extent and subject to
370-19   any condition included in the ordinance authorizing the bonds.
370-20   (V.A.C.S. Art. 1118s, Sec. 2 (part).)
370-21         Sec. 1501.005.  CONTRACTS.  A municipality may contract with
370-22   another municipality, a person or corporation, or the United States
370-23   to provide sewer service.  (V.A.C.S. Art. 1118s, Sec. 3 (part).)
370-24         Sec. 1501.006.  RATES FOR SERVICE.  (a)  The governing body
370-25   of a municipality that issues bonds under this subchapter shall
370-26   establish rates for sewer service in amounts sufficient to:
370-27               (1)  pay:
 371-1                     (A)  maintenance and operation expenses;
 371-2                     (B)  the bonds as they are scheduled to mature;
 371-3   and
 371-4                     (C)  interest on the bonds as it accrues; and
 371-5               (2)  establish and maintain any fund provided in the
 371-6   ordinance authorizing the bonds.
 371-7         (b)  Notwithstanding Subsection (a), the municipality may
 371-8   not, during the term of a contract for sewer service, increase the
 371-9   amount of the consideration for that service specified in the
371-10   contract except:
371-11               (1)  as the contract provides; or
371-12               (2)  as the parties to the contract agree.  (V.A.C.S.
371-13   Art. 1118s, Sec. 4.)
371-14         Sec. 1501.007.  OTHER LAW APPLICABLE; ELECTION NOT REQUIRED.
371-15   (a)  Subtitles A and C and Subchapter B, Chapter 1502, apply to the
371-16   issuance of bonds under this subchapter except as provided by this
371-17   subchapter.
371-18         (b)  An election is not required to authorize the issuance of
371-19   bonds under this subchapter.  (V.A.C.S. Art. 1118s, Sec. 5 (part).)
371-20           (Sections 1501.008-1501.050 reserved for expansion)
371-21         SUBCHAPTER B.  APPLICATION OF UTILITY SYSTEM REVENUE TO
371-22                          BONDED DEBT ON SYSTEM
371-23         Sec. 1501.051.  AUTHORITY TO USE UTILITY REVENUE FOR SINKING
371-24   FUND OR INTEREST PAYMENTS.  (a)  The governing body of a
371-25   municipality may appropriate the net revenue from any municipal
371-26   public utility system, service, or enterprise, in the amount that
371-27   the governing body determines is in the best interest of the
 372-1   municipality, to:
 372-2               (1)  the credit of the sinking fund for any bonded debt
 372-3   incurred because of the utility system, service, or enterprise; or
 372-4               (2)  the payment of any interest on the bonded debt
 372-5   incurred because of that utility system, service, or enterprise.
 372-6         (b)  A governing body that makes an appropriation under
 372-7   Subsection (a) must make the appropriation:
 372-8               (1)  at the end of the municipality's fiscal year; and
 372-9               (2)  before the governing body adopts a tax rate for
372-10   that fiscal year.  (V.A.C.S. Art. 1106 (part).)
372-11         Sec. 1501.052.  EFFECT ON TAXES.  (a)  If in any fiscal year
372-12   the amount of revenue appropriated under Section 1501.051 is at
372-13   least equal to the amount needed for the sinking fund and to pay
372-14   interest on the bonded indebtedness in that fiscal year, the
372-15   governing body of the municipality is not required to impose a tax
372-16   for that purpose.
372-17         (b)  If the amount of revenue appropriated under Section
372-18   1501.051 is less than the amount needed for the sinking fund and to
372-19   pay interest in the fiscal year, the governing body shall adopt a
372-20   tax rate for that year sufficient to generate the amount of taxes
372-21   necessary to credit or pay the deficiency in that year.
372-22         (c)  This section does not authorize a municipality to exceed
372-23   a limitation on taxes.  (V.A.C.S. Art. 1106 (part).)
372-24           (Sections 1501.053-1501.100 reserved for expansion)
372-25             SUBCHAPTER C.  REVENUE BONDS TO FINANCE CERTAIN
372-26                  TEXAS-NEW MEXICO ELECTRIC PROPERTIES
372-27         Sec. 1501.101.  AUTHORITY TO ACQUIRE AND OPERATE TEXAS-NEW
 373-1   MEXICO ELECTRIC PLANT AND SYSTEM.  A municipality that receives
 373-2   electricity from a privately owned electric plant and system, part
 373-3   of which is located in New Mexico, including a facility for the
 373-4   generation or transmission of electricity distributed in part to
 373-5   residents of the municipality, may acquire, own, and operate all or
 373-6   any part of that electric plant and system.  (V.A.C.S. Art. 1108a,
 373-7   Sec. 1 (part).)
 373-8         Sec. 1501.102.  AUTHORITY TO ISSUE REVENUE BONDS.  A
 373-9   municipality may issue revenue bonds in the manner provided by
373-10   general law to finance the acquisition of any part of the electric
373-11   plant and system under Section 1501.101.  (V.A.C.S. Art. 1108a,
373-12   Sec. 1 (part).)
373-13         Sec. 1501.103.  AUTHORITY TO SELL ELECTRICITY OF PLANT AND
373-14   SYSTEM.  A municipality that acquires an electric plant and system
373-15   under Section 1501.101 may:
373-16               (1)  sell electricity either at retail or wholesale for
373-17   distribution in New Mexico; and
373-18               (2)  enter into a sales agreement for the electricity
373-19   as the governing body of the municipality provides.  (V.A.C.S.
373-20   Art. 1108a, Sec. 2.)
373-21           (Sections 1501.104-1501.150 reserved for expansion)
373-22         SUBCHAPTER D.  CERTIFICATES OF INDEBTEDNESS TO FINANCE
373-23        JUDGMENTS OR SETTLEMENTS RELATED TO MUNICIPAL NATURAL GAS
373-24                                 SYSTEM
373-25         Sec. 1501.151.  AUTHORITY TO ISSUE CERTIFICATES OF
373-26   INDEBTEDNESS.  The governing body of a general-law municipality may
373-27   authorize the issuance of certificates of indebtedness to pay:
 374-1               (1)  a final judgment of a court in a lawsuit arising
 374-2   from the municipality's operation of a natural gas system the
 374-3   municipality owns; or
 374-4               (2)  a settlement of such a lawsuit.  (V.A.C.S.
 374-5   Art. 1108b, Secs. 1, 2 (part).)
 374-6         Sec. 1501.152.  NOTICE OF INTENTION TO ISSUE CERTIFICATES OF
 374-7   INDEBTEDNESS.  (a)  The governing body of the municipality may not
 374-8   authorize the issuance of certificates of indebtedness under this
 374-9   subchapter until the municipality gives notice of the
374-10   municipality's intention to issue the certificates.
374-11         (b)  The notice must:
374-12               (1)  be published in a newspaper of general circulation
374-13   in the municipality once each week for two consecutive weeks, with
374-14   the first publication being before the 14th day before the date the
374-15   governing body proposes to adopt the ordinance authorizing the
374-16   issuance of the certificates of indebtedness; and
374-17               (2)  state:
374-18                     (A)  the time and place the governing body of the
374-19   municipality proposes to authorize the issuance;
374-20                     (B)  the maximum amount of the certificates to be
374-21   issued; and
374-22                     (C)  the purpose for which the certificates are
374-23   to be issued.  (V.A.C.S. Art. 1108b, Sec. 3(a).)
374-24         Sec. 1501.153.  PETITION; ELECTION.  (a)  If, before the
374-25   certificates of indebtedness are authorized, a petition is filed
374-26   with the secretary or clerk of the municipality protesting the
374-27   issuance of the certificates that is signed by at least five
 375-1   percent of the registered voters of the municipality, the
 375-2   municipality may not issue the certificates unless a proposition
 375-3   for the issuance of the certificates is approved at an election
 375-4   held for that purpose.
 375-5         (b)  The governing body shall hold the election in the manner
 375-6   provided by Chapter 1251 for a bond election.  (V.A.C.S.
 375-7   Art. 1108b, Sec. 3(b).)
 375-8         Sec. 1501.154.  MATURITY.  A certificate of indebtedness
 375-9   issued under this subchapter must mature not later than 20 years
375-10   after its date.  (V.A.C.S. Art. 1108b, Sec. 2 (part).)
375-11         Sec. 1501.155.  SIGNATURES; SEAL.  A certificate of
375-12   indebtedness issued under this subchapter must:
375-13               (1)  be signed by the mayor and the secretary or clerk
375-14   of the municipality; and
375-15               (2)  bear the seal of the municipality.  (V.A.C.S.
375-16   Art. 1108b, Sec. 2 (part).)
375-17         Sec. 1501.156.  SALE OF CERTIFICATES.  (a)  A municipality
375-18   may sell certificates of indebtedness issued under this subchapter:
375-19               (1)  at a public or private sale;
375-20               (2)  on terms the governing body of the municipality
375-21   determines; and
375-22               (3)  with an option to prepay principal as the
375-23   governing body of the municipality considers advisable.
375-24         (b)  A municipality shall sell the certificates for cash.
375-25   (V.A.C.S. Art. 1108b, Sec. 2 (part).)
375-26         Sec. 1501.157.  USE OF PROCEEDS.  A municipality shall use
375-27   the proceeds from the sale of certificates of indebtedness issued
 376-1   under this subchapter for a purpose authorized by this subchapter.
 376-2   (V.A.C.S. Art. 1108b, Sec. 2 (part).)
 376-3         Sec. 1501.158.  IMPOSITION OF AD VALOREM TAX.  The governing
 376-4   body of the municipality shall impose an annual ad valorem tax
 376-5   sufficient to pay when due the principal of and interest on each
 376-6   certificate of indebtedness issued under this subchapter.
 376-7   (V.A.C.S. Art. 1108b, Sec. 4.)
 376-8           (Sections 1501.159-1501.200 reserved for expansion)
 376-9            SUBCHAPTER E.  BONDS FOR IMPROVEMENT OF WATER AND
376-10           SEWER SYSTEMS IN MUNICIPALITIES WITH POPULATION OF
376-11                            MORE THAN 275,000
376-12         Sec. 1501.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
376-13   applies only to:
376-14               (1)  a municipality that has:
376-15                     (A)  a population of more than 275,000; and
376-16                     (B)  a municipal water and sewer system operated
376-17   by a water board; and
376-18               (2)  a water control and improvement district that:
376-19                     (A)  is located in whole or in part within the
376-20   boundaries of a municipality described by Subdivision (1); and
376-21                     (B)  owns district property that is operated,
376-22   under a contract between a municipality described by Subdivision
376-23   (1) and the district, by a water board established by the charter
376-24   of the municipality or by ordinance.  (V.A.C.S. Art. 1110d,
376-25   Sec. 1.)
376-26         Sec. 1501.202.  DEFINITIONS.  In this subchapter:
376-27               (1)  "District property" means water or sewer property
 377-1   owned by a water control and improvement district that a
 377-2   municipality can use as, or use as an improvement or extension of,
 377-3   the water and sewer system of the municipality.
 377-4               (2)  "Water board" means a board of trustees or public
 377-5   service board.  (V.A.C.S. Art. 1110d, Sec. 2 (part); New.)
 377-6         Sec. 1501.203.  AUTHORITY TO ISSUE BONDS.  A municipality may
 377-7   issue bonds to pay for the purchase of district property to improve
 377-8   or extend the municipal water and sewer system.  (V.A.C.S.
 377-9   Art. 1110d, Secs. 2 (part), 3 (part).)
377-10         Sec. 1501.204.  PLEDGE OF REVENUE.  Bonds issued under this
377-11   subchapter must be secured by a pledge of and be payable from the
377-12   net revenue of the municipal water and sewer system, including any
377-13   district property purchased with the bond proceeds.  (V.A.C.S.
377-14   Art. 1110d, Sec. 3 (part).)
377-15         Sec. 1501.205.  NOTICE OF INTENTION TO ISSUE BONDS.  (a)  A
377-16   municipality may not issue bonds under this subchapter until the
377-17   mayor of the municipality gives notice of the municipality's
377-18   intention to issue the bonds.
377-19         (b)  The notice must:
377-20               (1)  be published in a newspaper of general circulation
377-21   in the municipality once each week for two consecutive weeks, with
377-22   the first publication being before the 14th day before the date the
377-23   governing body of the municipality proposes to adopt an ordinance
377-24   authorizing the issuance of the bonds; and
377-25               (2)  state the maximum:
377-26                     (A)  amount of bonds to be issued;
377-27                     (B)  interest rate of the bonds; and
 378-1                     (C)  maturity of the bonds.  (V.A.C.S.
 378-2   Art. 1110d, Sec. 4 (part).)
 378-3         Sec. 1501.206.  PETITION; ELECTION.  (a)  If, before the date
 378-4   the governing body of the municipality proposes to adopt the
 378-5   ordinance authorizing the issuance of the bonds, a petition is
 378-6   filed with the secretary or clerk of the municipality requesting an
 378-7   election on the issuance of the bonds that is signed by at least 10
 378-8   percent of the registered voters of the municipality, the
 378-9   municipality may not issue the bonds unless a proposition for the
378-10   issuance of the bonds is approved by a majority of the qualified
378-11   voters of the municipality voting at an election held for that
378-12   purpose.
378-13         (b)  The governing body shall hold the election in the manner
378-14   provided by Chapter 1251.  (V.A.C.S. Art. 1110d, Sec. 4 (part).)
378-15         Sec. 1501.207.  SALE OF DISTRICT PROPERTY.  A district may
378-16   sell to a municipality, and the municipality may buy, district
378-17   property only if the purchase price paid, when added to other
378-18   applicable money of the district, is sufficient to provide for the
378-19   payment of:
378-20               (1)  all outstanding district bonds, including interest
378-21   on the bonds to:
378-22                     (A)  the maturity dates of the bonds; or
378-23                     (B)  the dates the district sets for redemption
378-24   of the bonds;
378-25               (2)  any required redemption premium; and
378-26               (3)  any applicable fee of the bank of payment.
378-27   (V.A.C.S. Art. 1110d, Secs. 3 (part), 5.)
 379-1         Sec. 1501.208.  INTEREST AND SINKING FUND OF DISTRICT.  (a)
 379-2   The interest and sinking fund of a district must be permanently
 379-3   maintained in the bank where bonds of the district are payable.
 379-4         (b)  A district to which money is paid under Section 1501.207
 379-5   shall promptly deposit that money, as well as other applicable
 379-6   money and investments of the district, to the credit of the
 379-7   interest and sinking fund of the district.
 379-8         (c)  A bank of payment that receives a deposit of money or an
 379-9   investment shall hold that money or investment in trust for the
379-10   benefit of the holders of outstanding bonds of the district.
379-11   (V.A.C.S. Art. 1110d, Sec. 6 (part).)
379-12         Sec. 1501.209.  INVESTMENT OF MONEY IN INTEREST AND SINKING
379-13   FUND.  (a) The district's interest and sinking fund must be:
379-14               (1)  immediately invested in direct obligations of the
379-15   United States;
379-16               (2)  deposited in a bank or savings and loan
379-17   association, to the extent that the deposit is insured by an agency
379-18   of the United States; or
379-19               (3)  placed in a combination of investments described
379-20   by Subdivision (1) and deposits described by Subdivision (2).
379-21         (b)  An investment of the district's interest and sinking
379-22   fund must mature and produce income, without reinvestment, at times
379-23   and in amounts sufficient to pay:
379-24               (1)  the principal of the district's bonds as it
379-25   becomes due;
379-26               (2)  interest on the district's bonds as it becomes
379-27   due;
 380-1               (3)  any redemption premium on the redemption date; and
 380-2               (4)  any applicable fee of the bank of payment.
 380-3         (c)  The district shall apply money that exceeds the amount
 380-4   needed under Subsection (b) to the payment of other debts of the
 380-5   district.
 380-6         (d)  On request of the water board that operates property
 380-7   purchased under this subchapter, the bank in which the interest and
 380-8   sinking fund of the district is maintained shall pay to the water
 380-9   board any money or investment in that fund that exceeds the amount
380-10   needed under Subsection (b).  (V.A.C.S. Art. 1110d, Secs. 6 (part),
380-11   7, 8, 12.)
380-12         Sec. 1501.210.  PAYMENT OF OUTSTANDING BONDS.  After money
380-13   has been deposited with the bank where the outstanding district
380-14   bonds are payable, the district or the municipality may pay off any
380-15   outstanding district bonds if the money and investments that would
380-16   remain to the credit of the interest and sinking fund are
380-17   sufficient to provide for the payment of:
380-18               (1)  all of the remaining outstanding bonds of the
380-19   district;
380-20               (2)  the interest on the remaining outstanding bonds of
380-21   the district to:
380-22                     (A)  the maturity dates of the bonds; or
380-23                     (B)  the date set by the district for redemption
380-24   of its bonds; and
380-25               (3)  any required redemption premium.  (V.A.C.S.
380-26   Art. 1110d, Sec. 11.)
380-27         Sec. 1501.211.  ORDINANCE SPECIFYING DATE OF PASSAGE OF
 381-1   TITLE; ABOLITION OF DISTRICT.  (a)  After a municipality pays the
 381-2   purchase money for district property and that money is invested in
 381-3   compliance with Section 1501.209, the governing body of the
 381-4   municipality by ordinance shall specify the date on which title to
 381-5   that property passed or will pass to the municipality.  The date
 381-6   specified may be the first day of the fiscal year in which the
 381-7   municipality purchases the district property.
 381-8         (b)  Title to the district property vests in the municipality
 381-9   for all purposes on the date specified in the ordinance.
381-10         (c)  The governing body of the municipality shall abolish the
381-11   district by the ordinance required by Subsection (a) or a
381-12   subsequent ordinance.  (V.A.C.S. Art. 1110d, Sec. 9 (part).)
381-13         Sec. 1501.212.  OPERATION AND MANAGEMENT OF PROPERTIES.
381-14   After the governing body of a municipality abolishes a district
381-15   under Section 1501.211, the water board that manages the other
381-16   water and sewer properties of the municipality:
381-17               (1)  shall operate and manage the district property
381-18   purchased under this subchapter; and
381-19               (2)  may integrate that property into the municipal
381-20   water and sewer system to any extent.  (V.A.C.S. Art. 1110d, Secs.
381-21   9 (part), 10 (part).)
381-22         Sec. 1501.213.  SEGREGATION OF PROPERTIES.  (a)
381-23   Notwithstanding Section 1501.212(2), the payment or security of the
381-24   district's outstanding bonds may not be impaired.
381-25         (b)  If money is not available at the bank of payment for the
381-26   district's bonds to pay the principal of or the interest on the
381-27   bonds as it becomes due, the water board shall segregate from the
 382-1   municipal water and sewer system all district property purchased
 382-2   under this subchapter, including any replacement, renewal, or
 382-3   improvements of that property.
 382-4         (c)  The segregation of property must be accomplished so that
 382-5   the district property:
 382-6               (1)  is a complete and operating system; and
 382-7               (2)  serves substantially the same area as the district
 382-8   property served when title to the property vested in the
 382-9   municipality.
382-10         (d)  After segregation, the water board:
382-11               (1)  shall maintain and operate the district system
382-12   separately;
382-13               (2)  shall comply with the resolutions authorizing the
382-14   district's outstanding bonds; and
382-15               (3)  has each power, duty, and obligation previously
382-16   held by the district's board of directors regarding the:
382-17                     (A)  maintenance and operation of the system;
382-18                     (B)  handling of the district's funds; and
382-19                     (C)  payment of the district's outstanding bonds.
382-20         (e)  For purposes of Subsection (d), the water board is a
382-21   body corporate and occupies the same position as the district's
382-22   board of directors.  (V.A.C.S. Art. 1110d, Sec. 10 (part).)
382-23           (Sections 1501.214-1501.250 reserved for expansion)
382-24     SUBCHAPTER F.  ALTERNATIVE WATER SUPPLY FINANCING PROCEDURE FOR
382-25           MUNICIPALITIES WITH POPULATION OF MORE THAN 275,000
382-26         Sec. 1501.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
382-27   applies only to a municipality:
 383-1               (1)  that has a population of more than 275,000;
 383-2               (2)  in which a majority of the qualified voters voting
 383-3   in an election have voted to authorize the municipality to contract
 383-4   with a river authority created under Section 59, Article XVI, Texas
 383-5   Constitution, to acquire a water supply project from that
 383-6   authority; and
 383-7               (3)  that holds a permit issued by the Texas Natural
 383-8   Resource Conservation Commission for the municipality to use the
 383-9   water supply.  (V.A.C.S. Art. 1109h, Sec. 1.)
383-10         Sec. 1501.252.  ALTERNATIVE FINANCING PROCEDURE.  (a)  This
383-11   subchapter does not affect the right of a municipality or a river
383-12   authority to finance all of the cost of a water supply project, or
383-13   any part of the cost of the project that is not payable by the
383-14   municipality, by revenue bonds issued by the river authority and
383-15   based on the contract described by Section 1501.251(2).
383-16         (b)  The municipality and river authority may amend the
383-17   contract described by Section 1501.251(2) to implement the
383-18   financing procedure provided by this subchapter, including amending
383-19   the contract to:
383-20               (1)  define the extent of the municipality's rights in
383-21   the water supply project;
383-22               (2)  prescribe arrangements for auditing the funds and
383-23   accounts used in the construction program; and
383-24               (3)  provide procedures under which the municipality
383-25   will make available to the river authority proceeds from revenue
383-26   bonds issued under this subchapter, as necessary to pay
383-27   construction costs, including:
 384-1                     (A)  the cost of the municipality's intake
 384-2   structures and pumping and filtration equipment; and
 384-3                     (B)  the portion of costs that, under the
 384-4   contract, the river authority is not required to pay by the
 384-5   proceeds of the authority's revenue bonds.
 384-6         (c)  The municipality may:
 384-7               (1)  issue its revenue bonds, payable from the revenues
 384-8   of the municipality's:
 384-9                     (A)  waterworks system; or
384-10                     (B)  waterworks and sanitary sewer system, if the
384-11   systems are combined in the municipality; and
384-12               (2)  use the proceeds of the bonds as provided by this
384-13   subchapter.  (V.A.C.S. Art. 1109h, Sec. 2.)
384-14         Sec. 1501.253.  WATER SUPPLY PROJECT OWNERSHIP AND
384-15   RESPONSIBILITIES.  (a)  The water supply project of the river
384-16   authority may consist of:
384-17               (1)  a dam;
384-18               (2)  a reservoir;
384-19               (3)  related outlet facilities; and
384-20               (4)  land, easements, or flowage rights.
384-21         (b)  The river authority shall construct and operate the
384-22   water supply project.
384-23         (c)  The river authority shall own the property and each
384-24   facility of the water supply project except for any part of the
384-25   water supply project property that the municipality owns under the
384-26   contract between the municipality and the river authority.
384-27         (d)  Except for the water supply project and any facility the
 385-1   contract between the municipality and the river authority
 385-2   specifies, the municipality shall own, construct, and operate any
 385-3   other facility needed to deliver to the municipality treated water
 385-4   from the water supply project, including:
 385-5               (1)  the intake structure;
 385-6               (2)  pumping stations, pipelines, and equipment;
 385-7               (3)  treatment and filtration plants;
 385-8               (4)  all intermediate and terminal reservoirs,
 385-9   including intermediate reservoirs used to store water from the
385-10   water supply project; and
385-11               (5)  pumping and pipeline facilities to convey water to
385-12   and from intermediate reservoirs.  (V.A.C.S. Art. 1109h, Sec. 4
385-13   (part).)
385-14         Sec. 1501.254.  ORDINANCE AUTHORIZING AND ISSUANCE OF BONDS.
385-15   (a)  When the designs, plans, and specifications of the water
385-16   supply project of the river authority are complete to the extent
385-17   that they have been approved by the governing bodies of the
385-18   authority and the municipality, the governing body of the
385-19   municipality by ordinance may authorize the issuance of revenue
385-20   bonds in the amount estimated to be sufficient to pay:
385-21               (1)  the entire cost of the water supply project to be
385-22   incurred by the river authority, including interest during
385-23   construction; or
385-24               (2)  the portion of the cost of the water supply
385-25   project the municipality has contracted to pay.
385-26         (b)  The governing body of the municipality may issue the
385-27   bonds in an amount sufficient to pay:
 386-1               (1)  the cost of providing the facilities described by
 386-2   Section 1501.253(d), including any land, easement, or right-of-way
 386-3   needed for a facility; and
 386-4               (2)  interest during construction.
 386-5         (c)  The ordinance may reserve the right, and specify the
 386-6   conditions under which the right may be exercised, to issue
 386-7   additional revenue bonds on a parity with or subordinate to the
 386-8   original bonds.
 386-9         (d)  The ordinance must provide that all deposits to the
386-10   credit of the interest and sinking fund, the reserve fund, or
386-11   another fund must be made from the revenue from the waterworks
386-12   system of the municipality, or the waterworks and sanitary sewer
386-13   system of the municipality if those systems are combined.
386-14   (V.A.C.S. Art. 1109h, Secs. 4 (part), 5(a) (part), (b), (d)
386-15   (part).)
386-16         Sec. 1501.255.  NOTICE OF INTENTION TO ISSUE BONDS.  (a)  The
386-17   governing body of the municipality may not adopt an ordinance
386-18   authorizing the issuance of bonds under this subchapter until the
386-19   governing body gives notice of the time it proposes to adopt the
386-20   ordinance.
386-21         (b)  The notice must be published in at least two issues of a
386-22   newspaper of general circulation in the municipality, with the
386-23   first publication being before the 14th day before the date the
386-24   governing body proposes to adopt the ordinance.  (V.A.C.S.
386-25   Art. 1109h, Sec. 3 (part).)
386-26         Sec. 1501.256.  PETITION; ELECTION.  (a)  If, before the
386-27   governing body of the municipality is scheduled to adopt the
 387-1   ordinance authorizing the bonds, a petition is filed with the
 387-2   secretary of the municipality requesting an election on the
 387-3   issuance of the bonds that is signed by at least 10 percent of the
 387-4   registered voters who are resident owners of taxable property in
 387-5   the municipality, the municipality may not issue the bonds unless a
 387-6   proposition for the issuance of the bonds is approved by a majority
 387-7   of the qualified voters of the municipality voting at an election
 387-8   held for that purpose.
 387-9         (b)  The governing body may hold an election on the issuance
387-10   of the bonds regardless of whether a petition is filed.
387-11         (c)  The governing body shall hold the election in the manner
387-12   provided by Chapter 1251.  (V.A.C.S. Art. 1109h, Sec. 3 (part).)
387-13         Sec. 1501.257.  MATURITY.  Bonds issued under this subchapter
387-14   must mature within 40 years,  as provided by the ordinance
387-15   authorizing the issuance of the bonds.  (V.A.C.S. Art. 1109h, Sec.
387-16   5(a) (part).)
387-17         Sec. 1501.258.  SIGNATURES.  A bond issued under this
387-18   subchapter must be signed by:
387-19               (1)  the mayor; and
387-20               (2)  another designated officer of the municipality.
387-21   (V.A.C.S. Art. 1109h, Sec. 5(a) (part).)
387-22         Sec. 1501.259.  SALE OF BONDS.  A municipality may sell bonds
387-23   issued under this subchapter under terms the governing body of the
387-24   municipality determines to be the most advantageous and reasonably
387-25   obtainable.  (V.A.C.S. Art. 1109h, Sec. 5(a) (part).)
387-26         Sec. 1501.260.  INTERIM BONDS.  Pending the issuance of
387-27   definitive bonds under this subchapter, the municipality may
 388-1   authorize the delivery of negotiable interim bonds exchangeable for
 388-2   definitive bonds.  (V.A.C.S. Art. 1109h, Sec. 5(e).)
 388-3         Sec. 1501.261.  RATES, TOLLS, AND CHARGES.  After bonds are
 388-4   issued under this subchapter, the governing body of the
 388-5   municipality shall establish the rates, tolls, and charges for
 388-6   service provided by the municipality's waterworks system, or
 388-7   combined waterworks and sanitary sewer system if appropriate, in
 388-8   amounts sufficient to:
 388-9               (1)  pay the cost of operating and maintaining the
388-10   system;
388-11               (2)  pay when due the principal of and interest on the
388-12   bonds; and
388-13               (3)  establish and maintain the reserve fund and other
388-14   funds prescribed by the ordinance authorizing the bonds.  (V.A.C.S.
388-15   Art. 1109h, Sec. 5(c).)
388-16         Sec. 1501.262.  DEPOSIT AND USE OF BOND PROCEEDS.  (a)  The
388-17   governing body of the municipality:
388-18               (1)  shall provide for the deposit of money to the
388-19   credit of the interest and sinking fund, the reserve fund, and
388-20   other funds as prescribed by the ordinance authorizing the bonds;
388-21   and
388-22               (2)  may provide for all or part of the bond proceeds
388-23   to be deposited to the credit of those funds as necessary to pay
388-24   interest during construction and for an additional period not to
388-25   exceed two years.
388-26         (b)  The municipality shall deposit the bond proceeds to the
388-27   credit of a fund to be used solely to pay:
 389-1               (1)  the cost of issuing and selling the bonds;
 389-2               (2)  the construction cost of any part of the water
 389-3   supply project that the contract between the municipality and the
 389-4   river authority obligates the municipality to provide; and
 389-5               (3)  the construction cost of any part of the
 389-6   facilities to be constructed, owned, and operated by the
 389-7   municipality as provided by Section 1501.253.
 389-8         (c)  Before the use of the bond proceeds for construction or
 389-9   during the period of construction, the municipality may:
389-10               (1)  invest the proceeds in bonds or other direct
389-11   obligations of the United States; and
389-12               (2)  sell the investments as directed by the governing
389-13   body for construction purposes when necessary.  (V.A.C.S.
389-14   Art. 1109h, Secs. 5(d) (part), (h).)
389-15         Sec. 1501.263.  REFUNDING BONDS.  (a)  A municipality may
389-16   issue refunding bonds to refund outstanding bonds issued under this
389-17   subchapter and interest on the outstanding bonds.  The municipality
389-18   may issue refunding bonds without holding an election to approve
389-19   the issuance.
389-20         (b)  The municipality may provide additional security for the
389-21   refunding bonds.
389-22         (c)  The comptroller shall register the refunding bonds on
389-23   the surrender and cancellation of the bonds to be refunded.
389-24         (d)  In lieu of issuing bonds to be registered on the
389-25   surrender and cancellation of the bonds to be refunded, the
389-26   municipality, in the ordinance authorizing the issuance of the
389-27   refunding bonds, may provide for the sale of the refunding bonds
 390-1   and the deposit of the proceeds in a bank at which the bonds to be
 390-2   refunded are payable.  In that case, the refunding bonds may be
 390-3   issued in an amount sufficient to pay the interest on the bonds to
 390-4   be refunded to their maturity date or redemption date and the
 390-5   amount of any call premium, and the comptroller shall register the
 390-6   refunding bonds without the surrender and cancellation of the bonds
 390-7   to be refunded.  (V.A.C.S. Art. 1109h, Sec. 5(f).)
 390-8         Sec. 1501.264.  CONFLICT WITH OTHER LAW.  To the extent of a
 390-9   conflict or inconsistency between this subchapter and another law
390-10   or a special or home-rule charter, this subchapter controls.
390-11   (V.A.C.S. Art. 1109h, Sec. 7.)
390-12       CHAPTER 1502.  OBLIGATIONS FOR MUNICIPAL UTILITIES, PARKS,
390-13                                OR POOLS
390-14                    SUBCHAPTER A.  GENERAL PROVISIONS
390-15   Sec. 1502.001.  DEFINITION
390-16           (Sections 1502.002-1502.050 reserved for expansion)
390-17    SUBCHAPTER B.  REVENUE BONDS FOR UTILITY SYSTEMS, PARKS, OR POOLS
390-18   Sec. 1502.051.  DEFINITIONS
390-19   Sec. 1502.052.  AUTHORITY TO BUILD, PURCHASE, OR ENCUMBER
390-20                     UTILITY SYSTEM, SANITARY DISPOSAL EQUIPMENT,
390-21                     PARK, OR POOL
390-22   Sec. 1502.053.  AUTHORITY TO ISSUE BONDS, NOTES, OR
390-23                     WARRANTS
390-24   Sec. 1502.054.  PLEDGE OF REVENUE
390-25   Sec. 1502.055.  GRANT OF FRANCHISE
390-26   Sec. 1502.056.  OBLIGATIONS NOT PAYABLE FROM TAXES
390-27   Sec. 1502.057.  ELECTION
 391-1   Sec. 1502.058.  OPERATING EXPENSES AS FIRST LIEN
 391-2   Sec. 1502.059.  CHARGES FOR SERVICES
 391-3   Sec. 1502.060.  LIMITATION ON USE OF REVENUE
 391-4   Sec. 1502.061.  TRANSFER OF REVENUE TO GENERAL FUND
 391-5   Sec. 1502.062.  USE OF BOND PROCEEDS:  MUNICIPALITY WITH
 391-6                     POPULATION OF 75,000 OR MORE
 391-7   Sec. 1502.063.  REVENUE BONDS TO IMPROVE WATERWORKS SYSTEM:
 391-8                     TWO SERIES WITH DIFFERENT SECURITY
 391-9   Sec. 1502.064.  ADDITIONAL OBLIGATIONS TO IMPROVE OR EXTEND
391-10                     UTILITY SYSTEM
391-11   Sec. 1502.065.  LIEN PRIORITY:  REFUNDING BONDS
391-12   Sec. 1502.066.  BONDS FOR ACQUISITION OF HYDROELECTRIC
391-13                     GENERATING FACILITIES
391-14   Sec. 1502.067.  RECORDS
391-15   Sec. 1502.068.  RECORDS:  NONCASH BASIS
391-16   Sec. 1502.069.  ANNUAL REPORT
391-17   Sec. 1502.070.  OFFENSES; PENALTY
391-18   Sec. 1502.071.  MANAGEMENT AND CONTROL OF ENCUMBERED
391-19                     FACILITY
391-20   Sec. 1502.072.  RULES
391-21   Sec. 1502.073.  TRUSTEE
391-22   Sec. 1502.074.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE OR
391-23                     OTHER ACTION
391-24   Sec. 1502.075.  APPROPRIATION OF UTILITY SYSTEM INCOME: 
391-25                     MUNICIPALITY WITH POPULATION OF 12,410 OR
391-26                     LESS
391-27   Sec. 1502.076.  CIVIL ENFORCEMENT
 392-1   Sec. 1502.077.  CONFLICT WITH MUNICIPAL CHARTER
 392-2           (Sections 1502.078-1502.100 reserved for expansion)
 392-3            SUBCHAPTER C.  REVENUE BONDS FOR UTILITY SYSTEMS:
 392-4     MUNICIPALITIES OWNING AND OPERATING GAS AND ELECTRIC, WATER, OR
 392-5                              SEWER SYSTEMS
 392-6   Sec. 1502.101.  DEFINITIONS
 392-7   Sec. 1502.102.  APPLICABILITY OF SUBCHAPTER
 392-8   Sec. 1502.103.  PLEDGE OF REVENUE
 392-9   Sec. 1502.104.  AUTHORITY TO ENCUMBER UTILITY SYSTEM
392-10   Sec. 1502.105.  GRANT OF FRANCHISE
392-11   Sec. 1502.106.  OBLIGATIONS NOT PAYABLE FROM TAXES
392-12   Sec. 1502.107.  ELECTION
392-13   Sec. 1502.108.  OPERATING EXPENSES AS FIRST LIEN
392-14   Sec. 1502.109.  CHARGES FOR SERVICES
392-15   Sec. 1502.110.  LIMITATION ON USE OF REVENUE
392-16   Sec. 1502.111.  MANAGEMENT AND CONTROL OF ENCUMBERED SYSTEM
392-17   Sec. 1502.112.  RULES
392-18   Sec. 1502.113.  TRUSTEE
392-19   Sec. 1502.114.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
392-20                     OR OTHER ACTION
392-21   Sec. 1502.115.  RIGHT OF REPURCHASE
392-22           (Sections 1502.116-1502.150 reserved for expansion)
392-23             SUBCHAPTER D.  REVENUE BONDS FOR WATER SYSTEMS:
392-24           MUNICIPALITIES WITH POPULATION OF MORE THAN 160,000
392-25   Sec. 1502.151.  APPLICABILITY OF SUBCHAPTER
392-26   Sec. 1502.152.  AUTHORITY TO ENCUMBER WATER SYSTEM
392-27   Sec. 1502.153.  AUTHORITY TO ISSUE BONDS, NOTES, OR
 393-1                     OTHER OBLIGATIONS
 393-2   Sec. 1502.154.  PLEDGE OF REVENUE
 393-3   Sec. 1502.155.  GRANT OF FRANCHISE
 393-4   Sec. 1502.156.  OBLIGATIONS NOT PAYABLE FROM TAXES
 393-5   Sec. 1502.157.  ELECTION:  SALE OF WATER SYSTEM
 393-6   Sec. 1502.158.  ELECTION:  BOND OR NOTE ISSUANCE
 393-7   Sec. 1502.159.  OPERATING EXPENSES AS FIRST LIEN
 393-8   Sec. 1502.160.  CHARGES FOR SERVICES
 393-9   Sec. 1502.161.  ADDITIONAL OBLIGATIONS
393-10   Sec. 1502.162.  AGREEMENTS REGARDING APPLICATION OF REVENUE
393-11   Sec. 1502.163.  AUTHORITY TO BORROW MONEY AND ISSUE BONDS: 
393-12                     MUNICIPALITY WITH POPULATION OF MORE THAN
393-13                     290,000
393-14   Sec. 1502.164.  MANAGEMENT AND CONTROL OF ENCUMBERED SYSTEM
393-15   Sec. 1502.165.  RULES
393-16   Sec. 1502.166.  TRUSTEE
393-17   Sec. 1502.167.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
393-18                     OR OTHER ACTION
393-19           (Sections 1502.168-1502.200 reserved for expansion)
393-20              SUBCHAPTER E.  ADDITIONAL WATERWORKS BONDS OR
393-21                       WATERWORKS AND SEWER BONDS
393-22   Sec. 1502.201.  APPLICABILITY OF SUBCHAPTER
393-23   Sec. 1502.202.  AUTHORITY TO ISSUE BONDS
393-24   Sec. 1502.203.  COMBINED ISSUANCE
393-25   Sec. 1502.204.  ELECTION
393-26   Sec. 1502.205.  PRIORITY OF CHARGES AGAINST REVENUE
393-27   Sec. 1502.206.  LIMITATION ON ISSUANCE OF ADDITIONAL BONDS
 394-1   Sec. 1502.207.  COMPTROLLER'S DUTIES
 394-2   Sec. 1502.208.  COMPTROLLER'S FEES
 394-3   Sec. 1502.209.  WITHDRAWAL OF DEPOSIT
 394-4   Sec. 1502.210.  RIGHTS OF HOLDERS
 394-5   Sec. 1502.211.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS
 394-6           (Sections 1502.212-1502.250 reserved for expansion)
 394-7       SUBCHAPTER F.  ADDITIONAL BONDS FOR EXTENSION, IMPROVEMENT,
 394-8                     OR ACQUISITION OF WATER SYSTEM
 394-9   Sec. 1502.251.  APPLICABILITY OF SUBCHAPTER
394-10   Sec. 1502.252.  AUTHORITY TO ISSUE BONDS
394-11   Sec. 1502.253.  ELECTION
394-12   Sec. 1502.254.  PRIORITY OF CHARGES AGAINST REVENUE
394-13   Sec. 1502.255.  SALE BY HOME-RULE MUNICIPALITY
394-14   Sec. 1502.256.  LIMITATIONS ON ISSUANCE OF ADDITIONAL BONDS
394-15   Sec. 1502.257.  SUBROGATION:  REFUNDING WATER REVENUE BONDS
394-16   Sec. 1502.258.  REFUNDING AGREEMENTS
394-17   Sec. 1502.259.  COMPTROLLER'S DUTIES
394-18   Sec. 1502.260.  COMPTROLLER'S FEES
394-19   Sec. 1502.261.  WITHDRAWAL OF DEPOSIT
394-20   Sec. 1502.262.  RIGHTS OF HOLDERS
394-21   Sec. 1502.263.  CONFLICT OR INCONSISTENCY WITH OTHER LAW OR
394-22                     MUNICIPAL CHARTER
394-23           (Sections 1502.264-1502.300 reserved for expansion)
394-24          SUBCHAPTER G.  REFUNDING WATERWORKS AND SEWER BONDS;
394-25        ADDITIONAL BONDS:  MUNICIPALITIES NOT AUTHORIZED TO ISSUE
394-26                              PARITY BONDS
394-27   Sec. 1502.301.  APPLICABILITY OF SUBCHAPTER
 395-1   Sec. 1502.302.  AUTHORITY TO ISSUE REFUNDING BONDS
 395-2   Sec. 1502.303.  MATURITY
 395-3   Sec. 1502.304.  ADDITIONAL BONDS
 395-4   Sec. 1502.305.  ELECTION
 395-5           (Sections 1502.306-1502.350 reserved for expansion)
 395-6       SUBCHAPTER H.  REFUNDING BONDS:  MUNICIPALITIES OWNING AND
 395-7      OPERATING COMBINED WATER, SEWER, AND ELECTRIC UTILITY SYSTEMS
 395-8   Sec. 1502.351.  APPLICABILITY OF SUBCHAPTER
 395-9   Sec. 1502.352.  AUTHORITY TO ISSUE REFUNDING BONDS
395-10   Sec. 1502.353.  SOURCES AVAILABLE FOR PAYMENT
395-11   Sec. 1502.354.  COMBINATION ISSUANCE; SUBSEQUENT ISSUANCE
395-12   Sec. 1502.355.  ELECTION
395-13   Sec. 1502.356.  MATURITY
395-14   Sec. 1502.357.  METHOD AND TERMS OF SALE
395-15   Sec. 1502.358.  REGISTRATION WITHOUT CANCELLATION OF
395-16                     OBLIGATIONS TO BE REFUNDED
395-17   Sec. 1502.359.  REDEMPTION
395-18   Sec. 1502.360.  INVESTMENT OF PROCEEDS
395-19   Sec. 1502.361.  DEPOSIT WITH COMPTROLLER
395-20   Sec. 1502.362.  CERTIFICATION OF DEPOSIT ADEQUACY
395-21   Sec. 1502.363.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS
395-22   Sec. 1502.364.  DEPOSITS TO BE HELD IN ESCROW; LIEN; TITLE
395-23   Sec. 1502.365.  DEPOSIT BY COMPTROLLER WITH PAYING
395-24                     AGENT; PAYING AGENT'S DUTIES
395-25   Sec. 1502.366.  RETURN OF SURPLUS
395-26   Sec. 1502.367.  COMPTROLLER'S FEES
395-27   Sec. 1502.368.  AUTHORITY TO DEPOSIT DIRECTLY WITH
 396-1                     PAYING AGENT
 396-2   Sec. 1502.369.  DISCHARGE AND FINAL PAYMENT; REDEMPTION;
 396-3                     SUBORDINATION
 396-4   Sec. 1502.370.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT
 396-5   Sec. 1502.371.  CONFLICT OR INCONSISTENCY WITH OTHER LAW
 396-6                     OR MUNICIPAL CHARTER
 396-7           (Sections 1502.372-1502.400 reserved for expansion)
 396-8       SUBCHAPTER I.  REFUNDING BONDS:  ELECTRIC UTILITY SYSTEM OR
 396-9                     ELECTRIC AND GAS UTILITY SYSTEM
396-10   Sec. 1502.401.  APPLICABILITY OF SUBCHAPTER
396-11   Sec. 1502.402.  CONSTRUCTION
396-12   Sec. 1502.403.  AUTHORITY TO ISSUE REFUNDING BONDS
396-13   Sec. 1502.404.  SOURCES AVAILABLE FOR PAYMENT
396-14   Sec. 1502.405.  COMBINATION ISSUANCE; SUBSEQUENT ISSUANCE
396-15   Sec. 1502.406.  ELECTION
396-16   Sec. 1502.407.  MATURITY
396-17   Sec. 1502.408.  ISSUANCE IN EXCHANGE FOR OBLIGATIONS TO BE
396-18                     REFUNDED
396-19   Sec. 1502.409.  CASH SALE
396-20   Sec. 1502.410.  REGISTRATION WITHOUT CANCELLATION OF
396-21                     OBLIGATIONS TO BE REFUNDED
396-22   Sec. 1502.411.  REDEMPTION
396-23   Sec. 1502.412.  DEPOSIT WITH COMPTROLLER
396-24   Sec. 1502.413.  INVESTMENT OF PROCEEDS
396-25   Sec. 1502.414.  DEPOSIT OF INVESTMENTS WITH COMPTROLLER;
396-26                     DEPOSIT ADEQUACY
396-27   Sec. 1502.415.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS
 397-1   Sec. 1502.416.  DEPOSIT TO BE HELD IN ESCROW; LIEN; TITLE
 397-2   Sec. 1502.417.  DEPOSIT BY COMPTROLLER WITH PAYING
 397-3                     AGENT; PAYING AGENT'S DUTIES
 397-4   Sec. 1502.418.  RETURN OF SURPLUS
 397-5   Sec. 1502.419.  COMPTROLLER'S FEES
 397-6   Sec. 1502.420.  AUTHORITY TO DEPOSIT DIRECTLY WITH
 397-7                     PAYING AGENT
 397-8   Sec. 1502.421.  DISCHARGE AND FINAL PAYMENT; REDEMPTION;
 397-9                     SUBORDINATION
397-10   Sec. 1502.422.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT
397-11   Sec. 1502.423.  CONFLICT OR INCONSISTENCY WITH OTHER LAW OR
397-12                     MUNICIPAL CHARTER
397-13           (Sections 1502.424-1502.450 reserved for expansion)
397-14        SUBCHAPTER J.  COMBINED ISSUE OF REFUNDING AND ADDITIONAL
397-15            BONDS:  MUNICIPALITY IN COUNTY WITH POPULATION OF
397-16                             525,000 OR MORE
397-17   Sec. 1502.451.  APPLICABILITY OF SUBCHAPTER
397-18   Sec. 1502.452.  AUTHORITY TO ISSUE BONDS
397-19   Sec. 1502.453.  PLEDGE OF REVENUE
397-20   Sec. 1502.454.  ENCUMBRANCE OF PHYSICAL PROPERTIES; GRANT OF
397-21                     FRANCHISE
397-22   Sec. 1502.455.  DESIGNATION
397-23   Sec. 1502.456.  MATURITY
397-24   Sec. 1502.457.  ELECTION
397-25   Sec. 1502.458.  ORDER OF REGISTRATION BY COMPTROLLER
397-26           (Sections 1502.459-1502.500 reserved for expansion)
397-27          SUBCHAPTER K.  MISCELLANEOUS ADDITIONAL PARITY BONDS
 398-1   Sec. 1502.501.  ADDITIONAL BONDS TO EXTEND AND IMPROVE
 398-2                     ELECTRIC AND GAS UTILITY SYSTEMS
 398-3   Sec. 1502.502.  ADDITIONAL BONDS PAYABLE FROM WATER AND SEWER
 398-4                     SYSTEM AND SWIMMING POOL REVENUE
 398-5       CHAPTER 1502.  OBLIGATIONS FOR MUNICIPAL UTILITIES, PARKS,
 398-6                                OR POOLS
 398-7                    SUBCHAPTER A.  GENERAL PROVISIONS
 398-8         Sec. 1502.001.  DEFINITION.  In this chapter, "paying agent"
 398-9   means the person, including a bank or trust company, at whose
398-10   location payment of a refunded obligation is to be made.  (New.)
398-11           (Sections 1502.002-1502.050 reserved for expansion)
398-12    SUBCHAPTER B.  REVENUE BONDS FOR UTILITY SYSTEMS, PARKS, OR POOLS
398-13         Sec. 1502.051.  DEFINITIONS.  In this subchapter:
398-14               (1)  "Encumbered facility" means a utility system,
398-15   sanitary disposal system, park, or swimming pool encumbered under
398-16   this subchapter.
398-17               (2)  "Utility system" means an electric, water, sewer,
398-18   or natural gas system. (New.)
398-19         Sec. 1502.052.  AUTHORITY TO BUILD, PURCHASE, OR ENCUMBER
398-20   UTILITY SYSTEM, SANITARY DISPOSAL EQUIPMENT, PARK, OR POOL.  (a)  A
398-21   municipality may:
398-22               (1)  build, purchase, or encumber a municipal utility
398-23   system, sanitary disposal equipment, a park, or a swimming pool;
398-24               (2)  encumber anything acquired or to be acquired that
398-25   relates to a municipal utility system, sanitary disposal equipment,
398-26   a park, or a pool;
398-27               (3)  purchase additional water powers or riparian
 399-1   rights; or
 399-2               (4)  improve, enlarge, extend, or repair a municipal
 399-3   utility system, sanitary disposal equipment, a park, or a pool.
 399-4         (b)  A municipality may encumber one or more municipal
 399-5   utility systems, items of sanitary disposal equipment, parks, or
 399-6   pools to build, purchase, improve, extend, or repair the same or
 399-7   another municipal utility system, item of sanitary disposal
 399-8   equipment, park, or pool.  (V.A.C.S. Art. 1111 (part).)
 399-9         Sec. 1502.053.  AUTHORITY TO ISSUE BONDS, NOTES, OR WARRANTS.
399-10   A municipality may issue bonds, notes, or warrants to provide money
399-11   to build, purchase, improve, enlarge, extend, or repair a facility
399-12   described by Section 1502.052.  (V.A.C.S.  Art. 1111 (part).)
399-13         Sec. 1502.054.  PLEDGE OF REVENUE.  A municipality may pledge
399-14   the revenue and encumber the franchise of a facility described by
399-15   Section 1502.052 to secure the payment of obligations issued under
399-16   this subchapter.  (V.A.C.S. Art. 1111 (part).)
399-17         Sec. 1502.055.  GRANT OF FRANCHISE.  As additional security
399-18   for the encumbrance, the municipality by the terms of the
399-19   encumbrance may grant a purchaser under sale or foreclosure a
399-20   franchise to operate the encumbered facility or property for a term
399-21   not to exceed 20 years from the date of purchase, subject to all
399-22   laws regulating same then in force.  (V.A.C.S. Art. 1111 (part).)
399-23         Sec. 1502.056.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
399-24   obligation issued under this subchapter:
399-25               (1)  is not a debt of the municipality;
399-26               (2)  may be a charge only on the encumbered facility or
399-27   property; and
 400-1               (3)  may not be included in determining the
 400-2   municipality's power to issue bonds for any purpose authorized by
 400-3   law.
 400-4         (b)  Each contract, bond, note, or other evidence of
 400-5   indebtedness issued or included under this subchapter must contain
 400-6   the following provision:  "The holder of this obligation is not
 400-7   entitled to demand payment of this obligation out of any money
 400-8   raised by taxation."  (V.A.C.S. Arts. 1111 (part), 1114 (part).)
 400-9         Sec. 1502.057.  ELECTION.  (a)  Unless authorized by a
400-10   majority vote of the qualified voters of the municipality, a
400-11   municipality may not:
400-12               (1)  encumber a utility system, park, or swimming pool
400-13   for more than $10,000 except to:
400-14                     (A)  obtain money to acquire, construct, improve,
400-15   extend, or repair a utility system, park, or pool; or
400-16                     (B)  refund existing debt that was authorized by
400-17   law for a purpose stated in Paragraph (A); or
400-18               (2)  sell a utility system, park, or pool.
400-19         (b)  The governing body of the municipality shall hold an
400-20   election under this section in the manner provided for bond
400-21   elections in the municipality.
400-22         (c)  The encumbrances authorized by this section apply only
400-23   to bonds payable from revenue derived from the encumbered system.
400-24         (d)  This section does not apply to the sale of an
400-25   unencumbered natural gas system owned by a municipality with a
400-26   population of more than 1.2 million.  (V.A.C.S. Art. 1112.)
400-27         Sec. 1502.058.  OPERATING EXPENSES AS FIRST LIEN.  (a)  If
 401-1   the revenue of a utility system, park, or swimming pool is
 401-2   encumbered under this subchapter, each expense of operation and
 401-3   maintenance, including all salaries, labor, materials, interest,
 401-4   repairs and extensions necessary to provide efficient service, and
 401-5   each proper item of expense, is a first lien against that revenue.
 401-6         (b)  An expense for a repair or extension is a first lien
 401-7   only if, in the judgment of the governing body of the municipality,
 401-8   the repair or extension is necessary to:
 401-9               (1)  keep the plant or utility system in operation and
401-10   provide adequate service to the municipality and its residents; or
401-11               (2)  respond to a physical accident or condition that
401-12   would otherwise impair the original securities.  (V.A.C.S.
401-13   Art. 1113 (part).)
401-14         Sec. 1502.059.  CHARGES FOR SERVICES.  (a)   A municipality
401-15   shall impose and collect charges for services provided by an
401-16   encumbered system in amounts at least sufficient to pay:
401-17               (1)  all operating, maintenance, depreciation,
401-18   replacement, improvement, and interest charges in connection with
401-19   the encumbered system;
401-20               (2)  for an interest and sinking fund sufficient to pay
401-21   any bonds issued to purchase, construct, or improve the encumbered
401-22   system; and
401-23               (3)  any outstanding debt against the system.
401-24         (b)  The rates charged for services provided by an encumbered
401-25   system must be equal and uniform.  A municipality may not allow any
401-26   free service except for:
401-27               (1)  municipal public schools; or
 402-1               (2)  buildings and institutions operated by the
 402-2   municipality.  (V.A.C.S. Art. 1113 (part).)
 402-3         Sec. 1502.060.  LIMITATION ON USE OF REVENUE.  (a)  Except as
 402-4   provided by Subsection (b) or by Section 1502.061, a municipality
 402-5   may not use the revenue of an encumbered system to pay any other
 402-6   debt, expense, or obligation of the municipality until the debt
 402-7   secured by the revenue is finally paid.
 402-8         (b)  This section does not apply to a payment made in lieu of
 402-9   ad valorem taxes previously paid by a private owner of an
402-10   encumbered system.  (V.A.C.S. Art. 1113 (part).)
402-11         Sec. 1502.061.  TRANSFER OF REVENUE TO GENERAL FUND.
402-12   Notwithstanding Section 1502.060(a) or similar law, a municipality
402-13   and its officers and utility trustees may transfer to the
402-14   municipality's general fund and may use for general or special
402-15   purposes revenue of any municipally owned utility system in the
402-16   amount and to the extent authorized in the indenture, deed of
402-17   trust, or ordinance providing for and securing payment of revenue
402-18   bonds issued under this subchapter or similar law.  (V.A.C.S.
402-19   Art. 1113a.)
402-20         Sec. 1502.062.  USE OF BOND PROCEEDS:  MUNICIPALITY WITH
402-21   POPULATION OF 75,000 OR MORE.  (a)  A municipality with a
402-22   population of 75,000 or more, in issuing bonds under this
402-23   subchapter, as part of the cost of constructing new electric
402-24   utility plant facilities may set aside and use a portion of the
402-25   bond proceeds, to the extent provided in the ordinance authorizing
402-26   the issuance of the bonds:
402-27               (1)  to pay interest on bonds, the proceeds of which
 403-1   are for the construction of the facilities, to the first interest
 403-2   payment date after the date the new electric utility facilities are
 403-3   estimated to become operational; and
 403-4               (2)  to establish or supplement a reserve fund created
 403-5   for the benefit of the bond holders.
 403-6         (b)  The bond proceeds, an interest and sinking fund, or a
 403-7   reserve fund, pending their use for their intended purposes, may be
 403-8   invested in any security, interest-bearing certificate, or time
 403-9   deposit as specified in the proceedings authorizing the issuance of
403-10   the bonds.
403-11         (c)  This section controls over any other state law or any
403-12   municipal charter.  (V.A.C.S. Art. 1111d, Secs. 1, 2, 3 (part).)
403-13         Sec. 1502.063.  REVENUE BONDS TO IMPROVE WATERWORKS SYSTEM:
403-14   TWO SERIES WITH DIFFERENT SECURITY.  (a)  For the purpose of
403-15   improving, enlarging, or extending a waterworks system, a
403-16   municipality may issue revenue bonds under this subchapter in two
403-17   series as follows:
403-18               (1)  one series payable from and secured by a pledge of
403-19   all or part of the proceeds of a contract between the municipality
403-20   and a private corporation under which the municipality agrees to
403-21   sell water to the corporation for specified payments; and
403-22               (2)  the other series payable from and secured by a
403-23   pledge of the net revenue of the waterworks system or waterworks
403-24   and sewer systems other than the proceeds of the water supply
403-25   contract.
403-26         (b)  The ordinance authorizing the issuance of the bonds may
403-27   provide that the entire cost of operation, maintenance, and repair
 404-1   of the system or systems shall be paid from the revenue of the
 404-2   system or systems other than the proceeds of the water supply
 404-3   contract.
 404-4         (c)  A municipality may contract to sell water to a private
 404-5   corporation on terms prescribed by the municipality's governing
 404-6   body for a period not to exceed 40 years.  (V.A.C.S. Art. 1111c,
 404-7   Sec. 1.)
 404-8         Sec. 1502.064.  ADDITIONAL OBLIGATIONS TO IMPROVE OR EXTEND
 404-9   UTILITY SYSTEM.  (a)  A municipality that has outstanding bonds
404-10   secured by the net revenue of one or more of its utility systems
404-11   may issue additional bonds or other obligations to improve or
404-12   extend one or more of the utility systems.  The additional bonds
404-13   may be payable from the revenue from the operation of the utility
404-14   system or systems that is pledged to the payment of outstanding
404-15   bonds.
404-16         (b)  Except as provided by Subsection (c), bonds issued under
404-17   Subsection (a) constitute a lien on the revenue of the affected
404-18   system:
404-19               (1)  in the order of issuance; and
404-20               (2)  inferior to a lien securing payment of outstanding
404-21   bonds.
404-22         (c)  A municipality may issue additional bonds or series of
404-23   bonds under this section on a parity and of equal dignity with the
404-24   outstanding bonds if the ordinance, deed of trust, or indenture of
404-25   trust authorizing or securing the outstanding bonds provides for
404-26   the subsequent issuance of additional parity bonds, subject to that
404-27   ordinance, deed of trust, or indenture of trust.
 405-1         (d)  To the extent of a conflict or inconsistency between
 405-2   this section and another law, this section controls.  (V.A.C.S.
 405-3   Art. 1111a, Secs. 1 (part), 3 (part); Art. 1111b, Secs. 1 (part), 3
 405-4   (part).)
 405-5         Sec. 1502.065.  LIEN PRIORITY:  REFUNDING BONDS.  (a)  This
 405-6   section applies only to refunding bonds issued by a municipality
 405-7   that are payable from and secured by a pledge of the revenue of one
 405-8   or more of the municipality's utility systems.
 405-9         (b)  Refunding bonds described by Subsection (a) have a
405-10   priority of lien on the revenue pledged that is on a parity with
405-11   the lien priority of the bonds being refunded.
405-12         (c)  The lien of all refunding bonds issued in a single issue
405-13   to refund two or more consecutive series or issues of bonds is
405-14   equal if all of the outstanding bonds of those series or issues of
405-15   bonds are surrendered in exchange for the new refunding bonds.
405-16         (d)  Refunding bonds may not have a lien priority higher than
405-17   the highest lien priority of any series or issue of bonds being
405-18   refunded.  (V.A.C.S.  Art. 1111a, Secs. 1 (part), 2 (part);
405-19   Art. 1111b, Secs. 1 (part), 2 (part).)
405-20         Sec. 1502.066.  BONDS FOR ACQUISITION OF HYDROELECTRIC
405-21   GENERATING FACILITIES.  (a)  A municipality that owns an electric
405-22   distribution system, regardless of whether the municipality also
405-23   owns a facility for the generation of electricity, may issue bonds
405-24   under this subchapter to purchase and improve, maintain, and
405-25   operate a privately owned facility for the generation of
405-26   hydroelectric power having an installed capacity of not less than
405-27   2,000 kilowatts that is located  within five miles of the
 406-1   municipality's boundaries, including any land, flowage right or
 406-2   water right, and related generating and transmission equipment and
 406-3   lines.  The municipality may purchase the facility with the
 406-4   proceeds of the bonds or by issuing the bonds in exchange for the
 406-5   facility but only if authorized at an election held in accordance
 406-6   with Section 1502.057.
 406-7         (b)  For the purpose of the issuance and payment of the
 406-8   bonds, a hydroelectric generating facility acquired under this
 406-9   section may be regarded as an independent electric system that,
406-10   together with its revenue, may be pledged to the payment of the
406-11   bonds without any pledge of the municipality's other electric
406-12   facilities or the revenue of those facilities.
406-13         (c)  A municipality that acquires a hydroelectric generating
406-14   facility under this section shall perform any contract in existence
406-15   at the time of acquisition for the sale of electricity generated by
406-16   the facility unless the contract is canceled by voluntary agreement
406-17   of the municipality and each party  entitled to purchase
406-18   electricity under the contract.
406-19         (d)  Subject to the rights of any party to an existing
406-20   contract, the municipality shall take for distribution by its
406-21   distribution system the part of the output of the acquired
406-22   generating facility needed for distribution.  The municipality in
406-23   the proceedings authorizing the bonds may covenant, as the
406-24   municipality considers proper, for the use of the electricity and
406-25   for payment for the electricity from the revenue from the resale of
406-26   the electricity.
406-27         (e)  The municipality may enter into long-term or short-term
 407-1   contracts to sell to other purchasers any electricity generated by
 407-2   the facility that the municipality does not distribute by its
 407-3   system to its consumers.  (V.A.C.S. Art. 1118q, Sec. 1 (part).)
 407-4         Sec. 1502.067.  RECORDS.  The mayor of the municipality shall
 407-5   establish and maintain a complete system of records for a utility
 407-6   system, park, or swimming pool the revenue of which is encumbered
 407-7   under this subchapter that:
 407-8               (1)  shows the free service provided and the value of
 407-9   the service; and
407-10               (2)  shows separately the amounts spent and the amounts
407-11   set aside for operation, salaries, labor, materials, repairs,
407-12   maintenance, depreciation, replacements, extensions, interest, and
407-13   the creation of a sinking fund to pay the bonds and debt.
407-14   (V.A.C.S. Art. 1113 (part).)
407-15         Sec. 1502.068.  RECORDS:  NONCASH BASIS.  (a)  A municipality
407-16   may maintain its records on facilities under this subchapter or any
407-17   other municipal records on a basis other than a cash basis to the
407-18   extent permitted or required under generally accepted accounting
407-19   principles for a governmental entity.
407-20         (b)  A change in accounting methods does not affect the terms
407-21   of an existing contract with respect to the power to issue
407-22   additional obligations payable from the facilities.  (V.A.C.S.
407-23   Art. 1113b.)
407-24         Sec. 1502.069.  ANNUAL REPORT.  (a)  Not later than February
407-25   1 of each year, the superintendent or manager of a plant the
407-26   revenue of which is encumbered under this subchapter shall file
407-27   with the mayor of the municipality a detailed report of the
 408-1   operation of the plant for the year ending on the preceding January
 408-2   1.
 408-3         (b)  The report must show the total amount of money collected
 408-4   and the balance due, and the total disbursements made and the
 408-5   amounts remaining unpaid, resulting from the operation of the plant
 408-6   during that year.  (V.A.C.S. Art. 1113 (part).)
 408-7         Sec. 1502.070.  OFFENSES; PENALTY.  (a)  A mayor commits an
 408-8   offense if the mayor fails to:
 408-9               (1)  establish the system of records required by
408-10   Section 1502.067 before the 91st day after the date the plant is
408-11   completed; or
408-12               (2)  maintain the system of records required by Section
408-13   1502.067.
408-14         (b)  A superintendent or manager of a plant commits an
408-15   offense if the superintendent or manager fails to file a report
408-16   required by Section 1502.069.
408-17         (c)  An offense under this section is a misdemeanor
408-18   punishable by a fine of not less than $100 or more than $1,000.
408-19   (V.A.C.S.  Art. 1113 (part).)
408-20         Sec. 1502.071.  MANAGEMENT AND CONTROL OF ENCUMBERED
408-21   FACILITY.  (a)  The contract under which a facility is encumbered
408-22   may give management and control of the encumbered facility during
408-23   the time the facility is encumbered to:
408-24               (1)  the municipality's governing body; or
408-25               (2)  a board of trustees named in the encumbrance and
408-26   consisting of not more than five members, one of whom must be the
408-27   mayor of the municipality.
 409-1         (b)  The compensation of the trustees shall be specified by
 409-2   the contract of encumbrance.  The compensation may not exceed five
 409-3   percent of the encumbered facility's gross receipts in any year.
 409-4         (c)  The contract of encumbrance may specify the terms of
 409-5   office of the board of trustees, their powers and duties, the
 409-6   manner of exercising those powers and duties, the election of
 409-7   successor trustees, and any matter relating to the organization and
 409-8   duties of the board.  On any matter not covered by the contract,
 409-9   the board of trustees is governed by the laws and rules governing
409-10   the municipality's governing body, to the extent applicable.
409-11   (V.A.C.S. Art. 1115.)
409-12         Sec. 1502.072.  RULES.  (a)  The governing body or board of
409-13   trustees having management and control of an encumbered facility
409-14   may adopt rules to:
409-15               (1)  govern the provision of and payment for service;
409-16   and
409-17               (2)  provide for the discontinuance of service for
409-18   failure to pay when due until payment is made.
409-19         (b)  The governing body may provide penalties for:
409-20               (1)  the violation of a rule adopted under this
409-21   section;
409-22               (2)  the use of service without the consent or
409-23   knowledge of the authorities in charge; or
409-24               (3)  any interference with, trespass on, or injury to a
409-25   system or appliance or the premises on which the system or
409-26   appliance is located.  (V.A.C.S. Art. 1116.)
409-27         Sec. 1502.073.  TRUSTEE.  A contract under which a facility
 410-1   is encumbered may provide for:
 410-2               (1)  the selection of a trustee to sell the encumbered
 410-3   facility on default in the payment of principal or interest under
 410-4   the contract;
 410-5               (2)  the selection of a successor trustee if the
 410-6   original trustee is disqualified or fails to act; and
 410-7               (3)  the collection by the trustee of a fee of not more
 410-8   than five percent of the principal.  (V.A.C.S. Art. 1117.)
 410-9         Sec. 1502.074.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
410-10   OR OTHER ACTION.  (a)  Unless written notice is given to the
410-11   governing body of the municipality and to any board of trustees in
410-12   accordance with this section that there is a default in payment of
410-13   any installment of principal of or interest on an obligation issued
410-14   under this subchapter and that payment has been demanded:
410-15               (1)  a collection fee may not accrue;
410-16               (2)  a foreclosure proceeding may not be begun in a
410-17   court or through a trustee; and
410-18               (3)  an option to mature any part of the obligation
410-19   because of the default may not be exercised.
410-20         (b)  A notice under Subsection (a) must be sent by prepaid
410-21   registered mail to each member of the governing body and each
410-22   member of any board of trustees, addressed to the member at the
410-23   post office in the municipality.
410-24         (c)  An action described by Subsection (a) may not be taken
410-25   before the 91st day after the date the notice is mailed.
410-26         (d)  A payment of a delinquent installment of principal and
410-27   interest that is paid before the expiration of the period
 411-1   prescribed by Subsection (c) and that is accompanied by a payment
 411-2   of interest as prescribed in the contract, at a rate not to exceed
 411-3   10 percent per year, from the date of default until the date of
 411-4   payment, has the same effect as if paid on the date the installment
 411-5   was originally due.  (V.A.C.S. Art. 1118.)
 411-6         Sec. 1502.075. APPROPRIATION OF UTILITY SYSTEM INCOME:
 411-7   MUNICIPALITY WITH POPULATION OF 12,410 OR LESS.  (a)  This section
 411-8   applies only to a municipality that:
 411-9               (1)  has a population of 12,410 or less; and
411-10               (2)  owns and operates its light system and waterworks
411-11   system.
411-12         (b)  In the annual appropriation of the income and revenue of
411-13   any public utility system, service, or enterprise, the governing
411-14   body of a municipality that has adopted this section as provided by
411-15   Subsections (c) and (d) shall provide for appropriations in the
411-16   following order:
411-17               (1)  the maintenance and operating expenses of the
411-18   system, service, or enterprise;
411-19               (2)  the principal and interest of any debt outstanding
411-20   against the system, service, or enterprise; and
411-21               (3)  any appropriations the remaining income and
411-22   revenue of the system, service, or enterprise may justify, to be
411-23   appropriated among municipal departments or otherwise for public
411-24   uses as the governing body considers best.
411-25         (c)  At a special election called for the purpose, the
411-26   governing body of a municipality may submit the question of
411-27   adoption of this section to the municipality's qualified voters.
 412-1   The election shall be held as nearly as possible in compliance with
 412-2   the laws applying to regular municipal elections.
 412-3         (d)  If a majority of the voters voting in the election favor
 412-4   adoption:
 412-5               (1)  the governing body shall enter the election result
 412-6   in its minutes; and
 412-7               (2)  this section applies to the municipality effective
 412-8   at the time the result is entered in the minutes.
 412-9         (e)  This section does not:
412-10               (1)  restrict a municipality's authority under other
412-11   state law to issue bonds, notes, or warrants payable from revenue
412-12   other than taxes; or
412-13               (2)  affect the applicability of Section 1502.057.
412-14   (V.A.C.S. Art. 1118c, Secs. 1 (part), 2 (part), 3 (part).)
412-15         Sec. 1502.076.  CIVIL ENFORCEMENT.  A person who resides in a
412-16   municipality and is a taxpayer or holder of an obligation issued
412-17   under this subchapter and secured by the encumbered revenue of the
412-18   municipality's utility system, park, or swimming pool is entitled
412-19   to enforce this subchapter by appropriate civil action in a
412-20   district court in the county in which the municipality is located.
412-21   (V.A.C.S. Art. 1113 (part).)
412-22         Sec. 1502.077.  CONFLICT WITH MUNICIPAL CHARTER.  To the
412-23   extent of a conflict between this subchapter and a municipal
412-24   charter, this subchapter controls.  (V.A.C.S. Art. 1114b (part).)
412-25           (Sections 1502.078-1502.100 reserved for expansion)
412-26            SUBCHAPTER C.  REVENUE BONDS FOR UTILITY SYSTEMS:
412-27      MUNICIPALITIES OWNING AND OPERATING GAS AND ELECTRIC, WATER,
 413-1                            OR SEWER SYSTEMS
 413-2         Sec. 1502.101.  DEFINITIONS.  In this subchapter:
 413-3               (1)  "Encumbered system" means a utility system
 413-4   encumbered under this subchapter.
 413-5               (2)  "Utility system" means an electric, water, sewer,
 413-6   or natural gas system. (New.)
 413-7         Sec. 1502.102.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 413-8   applies only to a municipality that owns and operates its gas
 413-9   system and its electric, water, or sewer system.  (V.A.C.S.
413-10   Art. 1118a, Sec.  1 (part).)
413-11         Sec. 1502.103.  PLEDGE OF REVENUE.  A municipality may pledge
413-12   the revenue and encumber the franchise of a municipal utility
413-13   system or anything a municipality acquires relating to a municipal
413-14   utility system to secure the payment of money to:
413-15               (1)  build, purchase, improve, enlarge, extend, or
413-16   repair the same or another municipal utility system;
413-17               (2)  purchase additional water powers or riparian
413-18   rights; or
413-19               (3)  purchase land or other property the governing body
413-20   considers necessary in connection with the construction, purchase,
413-21   improvement, enlargement, extension, or repair.  (V.A.C.S.
413-22   Art. 1118a, Sec. 1 (part).)
413-23         Sec. 1502.104.  AUTHORITY TO ENCUMBER UTILITY SYSTEM.  A
413-24   municipality may encumber all or any part of one or more municipal
413-25   utility systems or anything a municipality acquires relating to a
413-26   municipal utility system to take an action authorized by Section
413-27   1502.103.  (V.A.C.S. Art. 1118a, Secs. 1 (part), 8.)
 414-1         Sec. 1502.105.  GRANT OF FRANCHISE.  As additional security
 414-2   for the encumbrance, the municipality by the terms of the
 414-3   encumbrance may grant a purchaser under sale or foreclosure a
 414-4   franchise to operate the encumbered system or property for a term
 414-5   not to exceed 20 years from the date of the purchase, subject to
 414-6   all laws regulating same then in force.  (V.A.C.S.  Art. 1118a,
 414-7   Sec. 1 (part).)
 414-8         Sec. 1502.106.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
 414-9   obligation described by Section 1502.103 or 1502.104:
414-10               (1)  is not a debt of the municipality;
414-11               (2)  may be a charge only on the encumbered system or
414-12   property; and
414-13               (3)  may not be included in determining the
414-14   municipality's power to issue bonds for any purpose authorized by
414-15   law.
414-16         (b)  Each contract, bond, or note issued or executed under
414-17   this subchapter must contain the following provision:  "The holder
414-18   of this obligation is not entitled to demand payment of this
414-19   obligation out of any money raised by taxation."  (V.A.C.S.
414-20   Art. 1118a, Secs. 1 (part), 4.)
414-21         Sec. 1502.107.  ELECTION.  (a)  Unless authorized by a
414-22   majority vote of the qualified voters of the municipality, a
414-23   municipality may not:
414-24               (1)  encumber a utility system for more than $5,000,
414-25   except for money to purchase or repair a utility system or to
414-26   refund any existing debt that was authorized by law; or
414-27               (2)  sell a utility system.
 415-1         (b)  The governing body of the municipality shall hold an
 415-2   election under this section in the manner provided for bond
 415-3   elections in the municipality.
 415-4         (c)  This section does not apply to the sale of an
 415-5   unencumbered natural gas system owned by a municipality with a
 415-6   population of more than 1.2 million.  (V.A.C.S. Art. 1118a, Sec.
 415-7   2.)
 415-8         Sec. 1502.108.  OPERATING EXPENSES AS FIRST LIEN.  If the
 415-9   revenue of a utility system is encumbered under this subchapter,
415-10   each expense of operation and maintenance, including all salaries,
415-11   labor, materials, interest, repairs and extensions necessary to
415-12   provide efficient service, and each proper item of expense, is a
415-13   first lien against that revenue.  (V.A.C.S. Art. 1118a, Sec. 3
415-14   (part).)
415-15         Sec. 1502.109.  CHARGES FOR SERVICES.  (a)  A municipality
415-16   shall impose and collect charges for services provided by an
415-17   encumbered system in amounts at least sufficient to pay:
415-18               (1)  all operating, maintenance, depreciation,
415-19   replacement, improvement, and interest charges in connection with
415-20   the encumbered system;
415-21               (2)  for an interest and sinking fund sufficient to pay
415-22   any bonds issued to purchase, construct, or improve the encumbered
415-23   system; and
415-24               (3)  any outstanding debt against the system.
415-25         (b)  The rates charged for services provided by an encumbered
415-26   system must be equal and uniform.  A municipality may not allow any
415-27   free service except for:
 416-1               (1)  municipal public schools; or
 416-2               (2)  buildings and institutions operated by the
 416-3   municipality.  (V.A.C.S. Art. 1118a, Sec. 3 (part).)
 416-4         Sec. 1502.110.  LIMITATION ON USE OF REVENUE.  (a)  Except as
 416-5   provided by Subsection (b), a municipality may not use the revenue
 416-6   of an encumbered system to pay any other debt, expense, or
 416-7   obligation of the municipality until the debt secured by the
 416-8   revenue is finally paid.
 416-9         (b)  This section does not apply to a debt, expense, or
416-10   obligation of:
416-11               (1)  the encumbered system; or
416-12               (2)  another system for the benefit of which the
416-13   encumbered system was encumbered.  (V.A.C.S. Art. 1118a, Sec. 9.)
416-14         Sec. 1502.111.  MANAGEMENT AND CONTROL OF ENCUMBERED SYSTEM.
416-15   The contract under which the system is encumbered shall provide
416-16   that the governing body of the municipality shall manage and
416-17   control the encumbered system during the time the system is
416-18   encumbered.  (V.A.C.S. Art. 1118a, Sec. 5 (part).)
416-19         Sec. 1502.112.  RULES.  (a)  The governing body having
416-20   management and control of an encumbered system may adopt rules to:
416-21               (1)  govern the provision of and payment for service;
416-22   and
416-23               (2)  provide for the discontinuance of service for
416-24   failure to pay when due until payment is made.
416-25         (b)  The governing body may provide penalties for:
416-26               (1)  the violation of a rule adopted under this
416-27   section;
 417-1               (2)  the use of service without the consent or
 417-2   knowledge of the authorities in charge; or
 417-3               (3)  any interference with, trespass on, or injury to a
 417-4   system or appliance or the premises on which the system or
 417-5   appliance is located.  (V.A.C.S. Art. 1118a, Sec. 5 (part).)
 417-6         Sec. 1502.113.  TRUSTEE.  A contract under which a system is
 417-7   encumbered may provide for:
 417-8               (1)  the selection of a trustee to sell the encumbered
 417-9   system on default in the payment of principal or interest under the
417-10   contract;
417-11               (2)  the selection of a successor trustee if the
417-12   original trustee is disqualified or fails to act; and
417-13               (3)  the collection by the trustee of a fee of not more
417-14   than five percent of the principal.  (V.A.C.S. Art. 1118a, Sec. 6
417-15   (part).)
417-16         Sec. 1502.114.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
417-17   OR OTHER ACTION.  (a)  Unless written notice is given to the
417-18   governing body of the municipality in accordance with this section
417-19   that there is a default in payment of any installment of principal
417-20   of or interest on an obligation issued under this subchapter and
417-21   that payment has been demanded:
417-22               (1)  a collection fee may not accrue;
417-23               (2)  a foreclosure proceeding may not be begun in a
417-24   court or through a trustee; and
417-25               (3)  an option to mature any part of the obligation
417-26   because of the default may not be exercised.
417-27         (b)  A notice under Subsection (a) must be sent by prepaid
 418-1   registered mail to each member of the governing body, addressed to
 418-2   the member at the post office in the municipality.
 418-3         (c)  An action described by Subsection (a) may not be taken
 418-4   before the 91st day after the date the notice is mailed.
 418-5         (d)  A payment of a delinquent installment of principal and
 418-6   interest that is paid before the expiration of the period
 418-7   prescribed by Subsection (c) and that is accompanied by a payment
 418-8   of interest as prescribed in the contract, at a rate not to exceed
 418-9   10 percent per year, from the date of default until the date of
418-10   payment, has the same effect as if paid on the date the installment
418-11   was originally due.  (V.A.C.S. Art. 1118a, Sec. 7.)
418-12         Sec. 1502.115.  RIGHT OF REPURCHASE.  The terms of the
418-13   encumbrance shall provide that in the event of default and sale
418-14   under foreclosure and the granting of a franchise to operate the
418-15   system or systems and properties as provided by Section 1502.105,
418-16   the municipality  has the right to repurchase the system or systems
418-17   on reasonable terms and at reasonable prices at any time during any
418-18   stipulated five-year redemption period within the franchise term.
418-19   The encumbrance agreement and the franchise agreement shall state
418-20   the terms and prices of redemption and the optional redemption
418-21   periods.  (V.A.C.S.  Art. 1118a, Sec. 6 (part).)
418-22           (Sections 1502.116-1502.150 reserved for expansion)
418-23             SUBCHAPTER D.  REVENUE BONDS FOR WATER SYSTEMS:
418-24           MUNICIPALITIES WITH POPULATION OF MORE THAN 160,000
418-25         Sec. 1502.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
418-26   applies only to a municipality with a population of more than
418-27   160,000.  (V.A.C.S. Art. 1109a, Sec. 1 (part).)
 419-1         Sec. 1502.152.  AUTHORITY TO ENCUMBER WATER SYSTEM.  (a)  A
 419-2   municipality may:
 419-3               (1)  encumber a water system;
 419-4               (2)  encumber anything relating to a water system;
 419-5               (3)  acquire or encumber additional water powers or
 419-6   riparian rights; or
 419-7               (4)  add to, extend, enlarge, or repair a water system.
 419-8         (b)  A municipality may encumber one or more water systems,
 419-9   water powers, or riparian rights to purchase, improve, extend, or
419-10   repair the same or another water system, water power, or riparian
419-11   right.  (V.A.C.S. Art. 1109a, Secs. 1 (part), 6 (part).)
419-12         Sec. 1502.153.  AUTHORITY TO ISSUE BONDS, NOTES, OR OTHER
419-13   OBLIGATIONS.  A municipality may borrow money and issue bonds,
419-14   notes, or other obligations to pay for any purchase, improvement,
419-15   addition, extension, enlargement, or repair authorized by Section
419-16   1502.152.  (V.A.C.S.  Art. 1109a, Secs. 1 (part), 3 (part), 6
419-17   (part).)
419-18         Sec. 1502.154.  PLEDGE OF REVENUE.  A municipality may pledge
419-19   the revenue or encumber the franchise of a system or property
419-20   described by Section 1502.152 to secure the payment of obligations
419-21   issued under this subchapter.  (V.A.C.S. Art. 1109a, Secs. 1
419-22   (part), 6 (part).)
419-23         Sec. 1502.155.  GRANT OF FRANCHISE.  As additional security
419-24   for the encumbrance, the municipality by the terms of the
419-25   encumbrance may grant a purchaser under sale or foreclosure a
419-26   franchise to operate the encumbered system or property described by
419-27   Section 1502.152 for a term not to exceed 20 years from the date of
 420-1   purchase, subject to all laws regulating the same then in force.
 420-2   (V.A.C.S. Art. 1109a, Sec. 1 (part).)
 420-3         Sec. 1502.156.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
 420-4   obligation issued under this subchapter:
 420-5               (1)  is not a debt of the municipality;
 420-6               (2)  may be a charge only on the encumbered system or
 420-7   property; and
 420-8               (3)  may not be included in determining the
 420-9   municipality's power to issue bonds for any purpose authorized by
420-10   law.
420-11         (b)  Each contract, bond, or note executed or issued under
420-12   this subchapter must contain the following provision:  "The holder
420-13   of this obligation is not entitled to demand payment of this
420-14   obligation out of any money raised by taxation."  (V.A.C.S.
420-15   Art. 1109a, Secs. 2 (part), 3 (part).)
420-16         Sec. 1502.157.  ELECTION: SALE OF WATER SYSTEM.  (a)  Unless
420-17   authorized by a majority vote of the qualified voters of the
420-18   municipality, a municipality may not sell a water system.
420-19         (b)  The governing body of the municipality shall give notice
420-20   of an election under this section in the manner provided for bond
420-21   elections in the municipality.
420-22         (c)  This section does not apply to the sale of a water
420-23   system that is authorized by the terms of the encumbrance of the
420-24   system.  (V.A.C.S. Art. 1109a, Sec. 6 (part).)
420-25         Sec. 1502.158.  ELECTION:  BOND OR NOTE ISSUANCE.  (a)
420-26   Unless authorized by a majority vote of the qualified voters of the
420-27   municipality, a municipality may not issue bonds or notes under
 421-1   this subchapter.
 421-2         (b)  The governing body of the municipality shall hold an
 421-3   election required by this section in the manner provided for other
 421-4   bond elections in the municipality.  Notwithstanding contrary
 421-5   provisions of other law or of a municipal charter, other notice or
 421-6   opportunities for filing petitions are not required.  (V.A.C.S.
 421-7   Art. 1109a, Sec. 6 (part).)
 421-8         Sec. 1502.159.  OPERATING EXPENSES AS FIRST LIEN.  If the
 421-9   revenue of a water system is encumbered under this subchapter, each
421-10   expense of operation and maintenance, including all salaries,
421-11   labor, materials, interest, repairs and extensions necessary to
421-12   provide efficient service, and each proper item of expense, is a
421-13   first lien against that revenue.  (V.A.C.S. Art. 1109a, Sec. 2
421-14   (part).)
421-15         Sec. 1502.160.  CHARGES FOR SERVICES.  (a)   A municipality
421-16   shall impose and collect charges for services provided by an
421-17   encumbered water system in amounts at least sufficient to pay:
421-18               (1)  all operating, maintenance, depreciation,
421-19   replacement, improvement, and interest charges in connection with
421-20   the encumbered system;
421-21               (2)  for an interest and sinking fund sufficient to pay
421-22   any bonds or notes issued to purchase, construct, or improve the
421-23   encumbered system; and
421-24               (3)  any outstanding debt against the encumbered
421-25   system.
421-26         (b)  The rates charged for services provided by an encumbered
421-27   system must be equal and uniform.  A municipality may not allow any
 422-1   free service except for:
 422-2               (1)  municipal public schools; or
 422-3               (2)  buildings and institutions operated by the
 422-4   municipality.  (V.A.C.S. Art. 1109a, Sec. 2 (part).)
 422-5         Sec. 1502.161.  ADDITIONAL OBLIGATIONS.  (a)  A municipality
 422-6   that has outstanding bonds, notes, or other obligations secured by
 422-7   the net revenue of its water system may issue additional bonds,
 422-8   notes, or other obligations under this subchapter to pay for any
 422-9   purchase, addition, extension, enlargement, or repair authorized by
422-10   Section 1502.152.  The additional bonds, notes, or other
422-11   obligations may be payable from water system revenue pledged to the
422-12   payment of outstanding bonds, notes, or other obligations.
422-13         (b)  Except as provided by Subsection (c):
422-14               (1)  the additional bonds or notes must be subordinate
422-15   in every respect to each issue of outstanding bonds, notes, or
422-16   other obligations payable from the water system revenue; and
422-17               (2)  each series of additional bonds, notes, or other
422-18   obligations must be subordinate, as to the lien on the revenue and
422-19   physical property of the water system, to each series of
422-20   outstanding bonds, notes, or other obligations payable from the
422-21   water system revenue.
422-22         (c)  A municipality may issue additional bonds or series of
422-23   bonds under this section on a parity and of equal dignity with the
422-24   outstanding bonds if:
422-25               (1)  the ordinance, deed of trust, or indenture of
422-26   trust authorizing or securing the outstanding bonds provides for
422-27   the subsequent issuance of additional parity bonds, subject to that
 423-1   ordinance, deed of trust, or indenture of trust; and
 423-2               (2)  the ordinance, deed of trust, or indenture of
 423-3   trust authorizing or securing the additional bonds provides that
 423-4   those bonds are on a parity and of equal dignity with the
 423-5   outstanding bonds.  (V.A.C.S. Art. 1109a, Sec. 2 (part).)
 423-6         Sec. 1502.162.  AGREEMENTS REGARDING APPLICATION OF REVENUE.
 423-7   (a)  Subject to other provisions of this subchapter, the governing
 423-8   body of a municipality, in authorizing the issuance of bonds,
 423-9   notes, or other obligations payable from the revenue of a water
423-10   system under this subchapter, may enter into agreements and
423-11   covenants regarding the application of the revenue of the water
423-12   system as the governing body considers appropriate.
423-13         (b)  The governing body may apply revenue of an encumbered
423-14   system that is not needed to pay the principal of and interest on
423-15   bonds, notes, or other obligations payable from the revenue of the
423-16   water system, or to pay operating and maintenance expenses, to the
423-17   payment of any notes, warrants, or other obligations the proceeds
423-18   of which were used to improve, repair, add to, or extend the water
423-19   system.  (V.A.C.S. Art. 1109a, Sec. 2 (part).)
423-20         Sec. 1502.163.  AUTHORITY TO BORROW MONEY AND ISSUE BONDS:
423-21   MUNICIPALITY WITH POPULATION OF MORE THAN 290,000.  (a)  This
423-22   section applies only to a municipality with a population of more
423-23   than 290,000.
423-24         (b)  The governing body of a municipality may borrow money
423-25   and issue bonds or notes payable solely out of the income of a
423-26   water system or of any extension, replacement, addition, or
423-27   improvement to that system that the governing body determines to be
 424-1   necessary to provide adequate service.  The governing body's
 424-2   determination is conclusive.
 424-3         (c)  The governing body may pledge and use the income of a
 424-4   water system for the payment of bonds or notes authorized by this
 424-5   section.  An ordinance pledging the rent, income, or revenue of a
 424-6   water system is part of the municipality's contract with the
 424-7   holders of the bonds or notes.
 424-8         (d)  Section 1502.158 does not apply to the issuance of bonds
 424-9   or notes authorized by this section.  (V.A.C.S.  Art. 1109a, Sec. 7
424-10   (part).)
424-11         Sec. 1502.164.  MANAGEMENT AND CONTROL OF ENCUMBERED SYSTEM.
424-12   (a)  The contract under which a water system is encumbered may give
424-13   management and control of the system during the time the system is
424-14   encumbered to:
424-15               (1)  the municipality's governing body; or
424-16               (2)  a board of trustees named in the encumbrance and
424-17   consisting of not more than five members, one of whom must be the
424-18   mayor of the municipality.
424-19         (b)  The compensation of the trustees shall be specified by
424-20   the contract of encumbrance.  The compensation may not exceed five
424-21   percent of the encumbered system's gross receipts in any year.
424-22         (c)  The contract of encumbrance may specify the terms of
424-23   office of the board of trustees, their powers and duties, the
424-24   manner of exercising those powers and duties, the election of
424-25   successor trustees, and any matter relating to the organization and
424-26   duties of the board.  On any matter not covered by the contract,
424-27   the board of trustees is governed by the laws and rules governing
 425-1   the municipality's governing body, to the extent applicable.
 425-2   (V.A.C.S. Art. 1109a, Sec. 4 (part).)
 425-3         Sec. 1502.165.  RULES.  (a)  The governing body or board of
 425-4   trustees having  management and control of an encumbered water
 425-5   system may adopt rules to:
 425-6               (1)  govern the provision of and payment for service;
 425-7   and
 425-8               (2)  provide for the discontinuance of service for
 425-9   failure to pay when due until payment is made.
425-10         (b)  The governing body may provide penalties for:
425-11               (1)  the violation of a rule adopted under this
425-12   section;
425-13               (2)  the use of service without the consent or
425-14   knowledge of the authorities in charge; or
425-15               (3)  any interference with, trespass on, or injury to a
425-16   system or appliance or the premises on which the system or
425-17   appliance is located.  (V.A.C.S. Art. 1109a, Sec. 4 (part).)
425-18         Sec. 1502.166.  TRUSTEE.  A contract under which a facility
425-19   is encumbered may:
425-20               (1)  name or provide for the selection of a trustee to
425-21   sell the encumbered system on default in the payment of principal
425-22   or interest under the contract;
425-23               (2)  provide for the selection of a successor trustee
425-24   if the original trustee is disqualified or fails to act; and
425-25               (3)  provide for the collection by the trustee of a fee
425-26   of not more than five percent of the principal.  (V.A.C.S.
425-27   Art. 1109a, Sec. 5 (part).)
 426-1         Sec. 1502.167.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
 426-2   OR OTHER ACTION.  (a)  Unless written notice is given to the
 426-3   governing body of the municipality and to any board of trustees in
 426-4   accordance with this section that there is a default in payment of
 426-5   any installment of principal of an obligation issued under this
 426-6   subchapter and that payment has been demanded:
 426-7               (1)  a collection fee may not accrue;
 426-8               (2)  a foreclosure proceeding may not be begun in a
 426-9   court or through a trustee; and
426-10               (3)  an option to mature any part of the obligation
426-11   because of the default may not be exercised.
426-12         (b)  A notice under Subsection (a) must be sent by prepaid
426-13   registered mail to each member of the governing body and each
426-14   member of any board of trustees, addressed to the member at the
426-15   post office in the municipality.
426-16         (c)  An action described by Subsection (a) may not be taken
426-17   before the 91st day after the date the notice is mailed.
426-18         (d)  A payment of a delinquent installment of principal and
426-19   interest that is paid before expiration of the period prescribed by
426-20   Subsection (c) and that is accompanied by a payment of interest as
426-21   prescribed in the contract, at a rate not to exceed 10 percent per
426-22   year, from the date of default until the date of payment, has the
426-23   same effect as if paid on the date the installment was originally
426-24   due.  (V.A.C.S. Art. 1109a, Sec. 5 (part).)
426-25           (Sections 1502.168-1502.200 reserved for expansion)
426-26              SUBCHAPTER E.  ADDITIONAL WATERWORKS BONDS OR
426-27                       WATERWORKS AND SEWER BONDS
 427-1         Sec. 1502.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 427-2   applies only to a municipality that has:
 427-3               (1)  outstanding waterworks or waterworks and sewer
 427-4   system revenue bonds; and
 427-5               (2)  through the issuance of refunding bonds or
 427-6   otherwise, enough money available to pay:
 427-7                     (A)  the bonds and interest on the bonds to the
 427-8   date on which the bonds are due or may be redeemed; and
 427-9                     (B)  any contract premium.  (V.A.C.S.
427-10   Art. 1118n-5, Secs. 1 (part), 1a (part).)
427-11         Sec. 1502.202.  AUTHORITY TO ISSUE BONDS.  (a)  A
427-12   municipality may issue additional bonds secured by a pledge of the
427-13   revenue from the operation of its waterworks system or of its
427-14   waterworks and sewer systems or in any other manner provided by
427-15   Subchapter B for the purposes authorized by Subchapter B if the
427-16   municipality has:
427-17               (1)  made a deposit with the comptroller for the
427-18   benefit of its outstanding waterworks or waterworks and sewer
427-19   revenue bonds in the manner authorized by Section 1207.021 for
427-20   advance refunding of bonds under Chapter 1207; and
427-21               (2)  otherwise complied with the requirements of
427-22   Section 1207.021.
427-23         (b)  The deposit authorized by Subsection (a)(1) must be made
427-24   before or at the same time as the sale and delivery of additional
427-25   bonds authorized by this subchapter.  All other proceedings related
427-26   to the authorization and issuance of the additional bonds
427-27   authorized by this subchapter must be made before the deposit is
 428-1   made.  (V.A.C.S. Art. 1118n-5, Secs. 1a (part), 2 (part), 4
 428-2   (part).)
 428-3         Sec. 1502.203.  COMBINED ISSUANCE.  Additional bonds issued
 428-4   under this subchapter may be combined in a single issue with
 428-5   refunding bonds.  (V.A.C.S. Art. 1118n-5, Sec. 1a (part).)
 428-6         Sec. 1502.204.  ELECTION.  A municipality may not issue
 428-7   additional bonds under this subchapter unless the bonds have been
 428-8   authorized at an election held in the municipality as provided by
 428-9   Section 1251.003.  (V.A.C.S. Art. 1118n-5, Sec. 4 (part).)
428-10         Sec. 1502.205.  PRIORITY OF CHARGES AGAINST REVENUE.  (a)
428-11   Except as provided by Subsections (b) and (c), additional bonds
428-12   issued under this subchapter are a first charge on the revenue of
428-13   the waterworks system or waterworks and sewer systems after the
428-14   payment of the maintenance and operation expenses of the system or
428-15   systems.
428-16         (b)  The priority established by Subsection (a) is subject
428-17   only to payments that must be made to the comptroller from the
428-18   pledged revenue to prevent default in principal of or interest on
428-19   outstanding bonds, for the benefit of which a deposit was made as
428-20   provided by Section 1502.202.
428-21         (c)  The right of a holder of an outstanding bond to have any
428-22   deficiency paid out of the pledged revenue is not impaired by the
428-23   priority established by Subsection (a).  (V.A.C.S. Art. 1118n-5,
428-24   Sec. 4 (part).)
428-25         Sec. 1502.206.  LIMITATION ON ISSUANCE OF ADDITIONAL BONDS.
428-26   A municipality may not issue additional bonds secured by a pledge
428-27   of the revenue of the waterworks system or waterworks and sewer
 429-1   systems while bonds issued under this subchapter and secured by
 429-2   that revenue are outstanding unless the additional bonds are issued
 429-3   in accordance with limitations prescribed in the ordinance
 429-4   authorizing the first bond issue under this subchapter.  (V.A.C.S.
 429-5   Art. 1118n-5, Sec. 5 (part).)
 429-6         Sec. 1502.207.  COMPTROLLER'S DUTIES.  (a)  The comptroller's
 429-7   duties regarding the acceptance, safekeeping, and use of money  or
 429-8   instruments deposited with the comptroller under this subchapter
 429-9   are the same as the duties prescribed by Section 1207.027 regarding
429-10   deposits made with the comptroller under Chapter 1207.
429-11         (b)  The comptroller's duties regarding deposits for payment
429-12   with the paying agent and payment and cancellation of outstanding
429-13   bonds under this subchapter are the same as the duties prescribed
429-14   by Section 1207.028 regarding deposits for payment with the paying
429-15   agent and payment and cancellation of bonds being refunded under
429-16   Subchapter B, Chapter 1207.  (V.A.C.S.  Art. 1118n-5, Secs. 2
429-17   (part), 3.)
429-18         Sec. 1502.208.  COMPTROLLER'S FEES.  The comptroller may
429-19   charge for the comptroller's services under this subchapter a
429-20   reasonable fee as authorized by Section 1207.032 for services
429-21   performed under Chapter 1207.  (V.A.C.S. Art. 1118n-5, Sec. 2
429-22   (part).)
429-23         Sec. 1502.209.  WITHDRAWAL OF DEPOSIT.  A municipality that
429-24   has made a deposit with the comptroller as authorized by Section
429-25   1502.202 may withdraw from the state treasury, in the manner
429-26   provided by Section 1207.031 for the withdrawal of advance
429-27   refunding deposits made under Subchapter B, Chapter 1207, the
 430-1   amount deposited to the credit of the account of an outstanding
 430-2   bond that has been refunded or redeemed.  (V.A.C.S.  Art. 1118n-5,
 430-3   Sec. 6.)
 430-4         Sec. 1502.210.  RIGHTS OF HOLDERS.  (a)  The holder of a bond
 430-5   being refunded under this subchapter by refunding bonds has the
 430-6   same rights as those prescribed by Section 1207.034 for the holder
 430-7   of an obligation being refunded under Chapter 1207.
 430-8         (b)  At any time after a municipality has made the deposit
 430-9   authorized by Section 1502.202 from a source other than the
430-10   proceeds of the sale of refunding bonds, the holder of any bond for
430-11   the benefit of which the deposit was made, regardless of the bond's
430-12   maturity date, may surrender the bond to the comptroller and
430-13   receive in exchange an amount equal to the amount on deposit with
430-14   the comptroller for the benefit of that bond.  After surrender and
430-15   payment, the comptroller shall cancel the bond and return the
430-16   canceled bond to the issuing municipality.  (V.A.C.S. Art. 1118n-5,
430-17   Sec. 7.)
430-18         Sec. 1502.211.  CONFLICT OR INCONSISTENCY WITH OTHER LAWS.
430-19   To the extent of a conflict or inconsistency between this
430-20   subchapter and another law, this subchapter controls.  (V.A.C.S.
430-21   Art. 1118n-5, Sec. 10 (part).)
430-22           (Sections 1502.212-1502.250 reserved for expansion)
430-23       SUBCHAPTER F.  ADDITIONAL BONDS FOR EXTENSION, IMPROVEMENT,
430-24                     OR ACQUISITION OF WATER SYSTEM
430-25         Sec. 1502.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
430-26   applies only to a municipality that has outstanding bonds payable
430-27   from the net revenue of its waterworks system, the net revenue of
 431-1   which for each of the two fiscal years preceding the date on which
 431-2   the municipality issues bonds under this subchapter is equal to
 431-3   twice the amount required to pay the principal of and interest on
 431-4   those outstanding bonds for the year in which that amount is
 431-5   greater.  (V.A.C.S. Art. 1118n-7, Sec. 1.)
 431-6         Sec. 1502.252.  AUTHORITY TO ISSUE BONDS.  (a)  A
 431-7   municipality  may issue additional bonds in accordance with
 431-8   Subchapter B secured by a pledge of the revenue from the operation
 431-9   of its waterworks system for a purpose authorized by Subsection (b)
431-10   if the municipality has:
431-11               (1)  made a deposit with the comptroller, for the
431-12   benefit of its outstanding waterworks revenue bonds that cannot be
431-13   obtained for refunding or redemption, in the manner authorized by
431-14   Section 1207.021 for advance refunding of bonds  under Chapter
431-15   1207; and
431-16               (2)  otherwise complied with the requirements of
431-17   Section 1207.021.
431-18         (b)  A municipality may issue bonds under this subchapter to:
431-19               (1)  extend or improve the water system;
431-20               (2)  acquire any privately or publicly owned water
431-21   system facility located in or adjacent to the municipality; or
431-22               (3)  acquire an additional water supply by purchase or
431-23   construction or by contribution to the construction of a reservoir
431-24   by the United States.  (V.A.C.S. Art. 1118n-7, Secs. 4 (part), 5
431-25   (part), 6 (part).)
431-26         Sec. 1502.253.  ELECTION.  (a)  A municipality may not issue
431-27   additional bonds under this subchapter unless the bonds have been
 432-1   authorized by a majority vote of the qualified voters of the
 432-2   municipality in an election held for that purpose.
 432-3         (b)  The governing body of the municipality shall hold the
 432-4   election in the manner required by law for an election to authorize
 432-5   the issuance of tax-supported bonds.  (V.A.C.S. Art. 1118n-7,
 432-6   Sec. 4 (part).)
 432-7         Sec. 1502.254.  PRIORITY OF CHARGES AGAINST REVENUE.  (a)
 432-8   Except as provided by Subsections (b) and (c), additional bonds
 432-9   issued under this subchapter:
432-10               (1)  shall be on a parity and of equal dignity with any
432-11   water system refunding bonds issued by the municipality;
432-12               (2)  shall be secured by a first lien on and pledge of
432-13   the net revenue of the water system; and
432-14               (3)  may be additionally secured by a first mortgage on
432-15   the physical properties constituting the water system.
432-16         (b)  If all the municipality's outstanding water revenue
432-17   bonds cannot be obtained for refunding or redemption, the
432-18   additional revenue bonds are a first charge on the revenue and
432-19   properties of the water system, subject only to any payments that
432-20   must be made from that revenue for the benefit of the outstanding
432-21   bonds.
432-22         (c)  The right of a holder of an outstanding water revenue
432-23   bond that is not refunded to have any deficiency paid out of the
432-24   pledged revenue is not impaired by the priority established by
432-25   Subsection (a).
432-26         (d)  In a situation described by Subsection (b), refunding
432-27   bonds issued by the municipality have the same priority as that
 433-1   established by that subsection for the additional bonds.  This
 433-2   subsection applies only to:
 433-3               (1)  refunding bonds secured by the revenue of the
 433-4   municipality's waterworks system; or
 433-5               (2)  tax-supported general obligation bonds issued by
 433-6   the municipality to provide money to refund or redeem the
 433-7   municipality's outstanding water revenue bonds payable from the
 433-8   revenue of the municipality's waterworks system, in an aggregate
 433-9   amount not greater than the aggregate principal amount of the
433-10   outstanding water revenue bonds and the total interest on those
433-11   bonds accrued to the final date of redemption of each of those
433-12   bonds.  (V.A.C.S.  Art. 1118n-7, Secs. 2 (part), 4 (part).)
433-13         Sec. 1502.255.  SALE BY HOME-RULE MUNICIPALITY.  A home-rule
433-14   municipality, in accordance with the municipality's charter, may
433-15   sell any water system revenue bond issued under this subchapter and
433-16   an additional amount of new revenue bonds not exceeding the total
433-17   amount of revenue bonds then outstanding.  (V.A.C.S. Art. 1118n-7,
433-18   Sec. 4 (part).)
433-19         Sec. 1502.256.  LIMITATIONS ON ISSUANCE OF ADDITIONAL BONDS.
433-20   Regardless of any contrary provision of a law under which the
433-21   additional or refunding bonds are to be issued, a municipality may
433-22   not issue additional bonds secured by a pledge of the revenue of
433-23   the water system while refunding bonds described by Section
433-24   1502.254(d) or revenue bonds issued under this subchapter are
433-25   outstanding unless the additional bonds are issued in accordance
433-26   with limitations prescribed in the ordinance or deed of trust
433-27   authorizing or securing the first bond issue under this subchapter.
 434-1   (V.A.C.S. Art. 1118n-7, Sec. 8.)
 434-2         Sec. 1502.257.  SUBROGATION:  REFUNDING WATER REVENUE BONDS.
 434-3   (a)  Except as otherwise provided by this section, a municipality
 434-4   that issues tax-supported general obligation bonds to refund
 434-5   outstanding bonds payable from the revenue of the municipality's
 434-6   waterworks system is:
 434-7               (1)  subrogated to the rights of the holders of the
 434-8   bonds being refunded to payments from the waterworks revenue
 434-9   pledged to the bonds being refunded; and
434-10               (2)  entitled to have paid into the municipality's
434-11   general fund from the revenue pledged to the bonds being refunded
434-12   the amount that would have been payable on the bonds being refunded
434-13   had those bonds remained outstanding.
434-14         (b)  The rights described by Subsection (a) do not limit an
434-15   encumbrance on the municipality's water system property that
434-16   secures other water revenue bonds.  Such an encumbrance remains in
434-17   force for the sole benefit of the holders of any unpaid water
434-18   revenue bonds of the municipality.  The right of the holders of
434-19   those bonds to enforce the encumbrance securing the bonds is
434-20   superior to the municipality's right, under Subsection (a), to
434-21   payment from its water system revenue.
434-22         (c)  This section does not affect a municipality's right,
434-23   under a contract under which the municipality issues water revenue
434-24   bonds, to payments into the municipality's general fund from the
434-25   municipality's water system revenue.  A payment described by this
434-26   subsection is in addition to any other payment described by this
434-27   section.  (V.A.C.S. Art. 1118n-7, Sec.  3.)
 435-1         Sec. 1502.258.  REFUNDING AGREEMENTS.  A municipality may
 435-2   enter into agreements with:
 435-3               (1)  holders of the municipality's outstanding water
 435-4   revenue bonds as necessary to refund, refinance, or redeem all or
 435-5   part of those bonds; and
 435-6               (2)  other persons, firms, or corporations as
 435-7   considered advisable by the municipality to further aid the
 435-8   refunding, refinancing, or redemption.  (V.A.C.S. Art. 1118n-7,
 435-9   Sec. 4 (part).)
435-10         Sec. 1502.259.  COMPTROLLER'S DUTIES.  (a)  The comptroller's
435-11   duties regarding the acceptance, safekeeping, and use of money and
435-12   instruments deposited with the comptroller under this subchapter
435-13   are the same as the duties prescribed by Section 1207.027 regarding
435-14   deposits with the comptroller under Chapter 1207.
435-15         (b)  The comptroller's duties regarding deposits for payment
435-16   with the paying agent and payment and cancellation of outstanding
435-17   bonds under this subchapter are the same as the duties prescribed
435-18   by Section 1207.028 regarding deposits for payment with the paying
435-19   agent and payment and cancellation of obligations being refunded
435-20   under Subchapter B, Chapter 1207.  (V.A.C.S. Art. 1118n-7, Secs.  5
435-21   (part), 6 (part).)
435-22         Sec. 1502.260.  COMPTROLLER'S FEES.  The comptroller may
435-23   charge for the comptroller's services under this subchapter a
435-24   reasonable fee as authorized by Section 1207.032 for services
435-25   performed under Chapter 1207.  (V.A.C.S. Art. 1118n-7, Sec. 5
435-26   (part).)
435-27         Sec. 1502.261.  WITHDRAWAL OF DEPOSIT.  A municipality that
 436-1   has made a deposit with the comptroller as authorized by Section
 436-2   1502.252(a) may withdraw from the state treasury, in the manner
 436-3   provided by Section 1207.031 for the withdrawal of advance
 436-4   refunding deposits made under Subchapter B, Chapter 1207, the
 436-5   amount deposited to the credit of the account of an outstanding
 436-6   bond that has been refunded or redeemed.  (V.A.C.S.  Art. 1118n-7,
 436-7   Sec. 9.)
 436-8         Sec. 1502.262.  RIGHTS OF HOLDERS.  (a)  The holder of an
 436-9   obligation being refunded under this subchapter by refunding bonds
436-10   has the same rights as those prescribed by Section 1207.034 for the
436-11   holder of an obligation being refunded under Chapter 1207.
436-12         (b)  At any time after a municipality has made the deposit
436-13   authorized by Section 1502.252(a) from a source other than the
436-14   proceeds of the sale of refunding bonds, the holder of any bond for
436-15   the benefit of which the deposit was made, regardless of the bond's
436-16   maturity date, may surrender the bond to the comptroller and
436-17   receive in exchange an amount equal to the amount on deposit with
436-18   the comptroller for the benefit of that bond.  After surrender and
436-19   payment, the comptroller shall cancel the bond and return the
436-20   canceled bond to the issuing municipality.  (V.A.C.S. Art. 1118n-7,
436-21   Sec. 7.)
436-22         Sec. 1502.263.  CONFLICT OR INCONSISTENCY WITH OTHER LAW OR
436-23   MUNICIPAL CHARTER.  (a)  To the extent of any conflict or
436-24   inconsistency between this subchapter and another law or a
436-25   municipal charter, this subchapter controls.
436-26         (b)  This subchapter does not affect Subchapter E.  (V.A.C.S.
436-27   Art. 1118n-7, Sec. 13 (part).)
 437-1           (Sections 1502.264-1502.300 reserved for expansion)
 437-2          SUBCHAPTER G.  REFUNDING WATERWORKS AND SEWER BONDS;
 437-3        ADDITIONAL BONDS:  MUNICIPALITIES NOT AUTHORIZED TO ISSUE
 437-4                              PARITY BONDS
 437-5         Sec. 1502.301.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 437-6   applies only to a municipality that:
 437-7               (1)  has outstanding bonds secured by a pledge of the
 437-8   net revenue of its sanitary sewer system;
 437-9               (2)  has other bonds secured by a lien on its
437-10   waterworks system and the revenue of that system; and
437-11               (3)  is not entitled to issue additional parity bonds
437-12   payable from its waterworks revenue.  (V.A.C.S. Art. 1118n-10,
437-13   Sec. 1 (part).)
437-14         Sec. 1502.302.  AUTHORITY TO ISSUE REFUNDING BONDS.  (a)  A
437-15   municipality may issue bonds to refund outstanding waterworks
437-16   revenue bonds and sewer revenue bonds into an issue of refunding
437-17   bonds that will be secured by and payable from a pledge of revenue
437-18   of both the waterworks system and the sewer system.
437-19         (b)  All or any part of the refunding bonds may be:
437-20               (1)  exchanged for outstanding bonds by the comptroller
437-21   in the manner provided by Subchapter D, Chapter 1207; or
437-22               (2)  sold for cash for purposes of advance refunding of
437-23   the unexchanged part of the bonds in the manner provided by
437-24   Subchapter B, Chapter 1207.  (V.A.C.S. Art. 1118n-10, Sec. 2
437-25   (part).)
437-26         Sec. 1502.303.  MATURITY.  A refunding bond issued under this
437-27   subchapter must mature within 40 years.  (V.A.C.S. Art. 1118n-10,
 438-1   Sec. 2 (part).)
 438-2         Sec. 1502.304.  ADDITIONAL BONDS.  (a)  A municipality may
 438-3   issue additional revenue bonds that will be on a parity with
 438-4   previously issued and outstanding revenue bonds under the
 438-5   conditions specified in the ordinance or ordinances authorizing the
 438-6   issuance of the outstanding bonds.
 438-7         (b)  Subchapter B applies to bonds issued under this
 438-8   subchapter except as otherwise provided by this subchapter.
 438-9         (c)  A municipality may issue junior lien bonds unless
438-10   prohibited by the ordinance authorizing outstanding bonds.
438-11   (V.A.C.S. Art. 1118n-10, Sec. 4.)
438-12         Sec. 1502.305.  ELECTION.  (a)  A municipality may issue
438-13   refunding bonds under this subchapter without holding an election.
438-14         (b)  If, before issuing refunding bonds under this
438-15   subchapter, the municipality has held an election authorizing the
438-16   issuance of bonds secured by a pledge of waterworks or sewer
438-17   revenue, the municipality may issue the bonds after issuing
438-18   refunding bonds and may secure the bonds with a pledge of the net
438-19   revenue of its waterworks system and sewer system without holding
438-20   an additional election.  (V.A.C.S. Art. 1118n-10, Secs. 2 (part),
438-21   3.)
438-22           (Sections 1502.306-1502.350 reserved for expansion)
438-23       SUBCHAPTER H.  REFUNDING BONDS:  MUNICIPALITIES OWNING AND
438-24      OPERATING COMBINED WATER, SEWER, AND ELECTRIC UTILITY SYSTEMS
438-25         Sec. 1502.351.  APPLICABILITY OF SUBCHAPTER.  This subchapter
438-26   applies only to a municipality that:
438-27               (1)  owns the water, sewer, and electric utility
 439-1   systems serving the municipality;
 439-2               (2)  operates those utilities as a combined system; and
 439-3               (3)  has issued and has outstanding bonds payable from
 439-4   the revenue of the combined system.  (V.A.C.S. Art. 1118n-11,
 439-5   Sec. 1.)
 439-6         Sec. 1502.352.  AUTHORITY TO ISSUE REFUNDING BONDS.  (a)  In
 439-7   this section, "interest-bearing obligation" includes a:
 439-8               (1)  bond;
 439-9               (2)  note;
439-10               (3)  warrant;
439-11               (4)  certificate of obligation; or
439-12               (5)  certificate of indebtedness.
439-13         (b)  The governing body of a municipality by resolution,
439-14   ordinance, or other action may issue bonds to refund any
439-15   outstanding interest-bearing obligations and interest coupons
439-16   relating to the obligations if:
439-17               (1)  the obligations:
439-18                     (A)  were issued by or on behalf of the
439-19   municipality; and
439-20                     (B)  have a stated maturity date or are
439-21   redeemable before maturity not more than 10 years after the
439-22   delivery date of the refunding bonds;
439-23               (2)  the refunding will enable the municipality to
439-24   issue additional interest-bearing obligations that the municipality
439-25   could not have issued without the refunding because the obligations
439-26   to be refunded or the resolution, ordinance, or order authorizing
439-27   the issuance of those obligations would require a record of revenue
 440-1   greater than the revenue available to the municipality and
 440-2   consequently would prevent the issuance of the additional
 440-3   obligations; and
 440-4               (3)  the municipality has demonstrated to the attorney
 440-5   general before the attorney general approves the refunding bonds
 440-6   that, based on then current conditions, the municipality will have
 440-7   adequate pledged resources available at the time required to pay
 440-8   the unrefunded part of any issue being refunded.
 440-9         (c)  Refunding bonds issued under this section may be issued
440-10   to refund all or any part of one or more issues of obligations and
440-11   interest coupons relating to the obligations.
440-12         (d)  Subsections (b)(1)(B) and (b)(2) do not apply to
440-13   refunding bonds payable solely from the net revenue of the
440-14   municipality's combined water, sewer, and electric utility systems.
440-15   (V.A.C.S. Art. 1118n-11, Secs. 2 (part), 2A(a), (b).)
440-16         Sec. 1502.353.  SOURCES AVAILABLE FOR PAYMENT.  A refunding
440-17   bond issued under this subchapter may be secured by and made
440-18   payable from taxes, revenue, property, another source, or a
440-19   combination of sources, to the extent that the issuer is otherwise
440-20   authorized to secure or pay any type of interest-bearing obligation
440-21   by or from that source or those sources.  (V.A.C.S. Art. 1118n-11,
440-22   Sec. 2 (part).)
440-23         Sec. 1502.354.  COMBINATION ISSUANCE; SUBSEQUENT ISSUANCE.
440-24   Under the terms and with the security set forth in the proceedings
440-25   that authorize the issuance of the refunding bonds, a municipality
440-26   may issue refunding bonds:
440-27               (1)  in combination with refunding bonds issued under
 441-1   other law or with new bonds;
 441-2               (2)  with provision for the subsequent issuance of
 441-3   additional parity bonds or subordinate lien bonds; or
 441-4               (3)  both in combination with refunding bonds issued
 441-5   under other law or with new bonds and with provision for the
 441-6   subsequent issuance of additional bonds.  (V.A.C.S. Art. 1118n-11,
 441-7   Sec. 2 (part).)
 441-8         Sec. 1502.355.  ELECTION.  (a)  Refunding bonds may be issued
 441-9   without an election in connection with the issuance of the
441-10   refunding bonds or the creation of an encumbrance in connection
441-11   with the refunding bonds, except as provided by Subsection (b).
441-12         (b)  If the constitution of this state requires an election
441-13   to permit a procedure, action, or matter relating to refunding
441-14   bonds, the governing body of the municipality shall hold an
441-15   election substantially in accordance, to the extent appropriate,
441-16   with Chapter 1251 to authorize the procedure, action, or matter.
441-17   (V.A.C.S. Art. 1118n-11, Sec. 2 (part).)
441-18         Sec. 1502.356.  MATURITY.  A refunding bond issued under this
441-19   subchapter must mature not later than 50 years after its date.
441-20   (V.A.C.S. Art. 1118n-11, Sec. 2 (part).)
441-21         Sec. 1502.357.  METHOD AND TERMS OF SALE.  (a)  Refunding
441-22   bonds issued under this subchapter shall be sold for cash in a
441-23   principal amount:
441-24               (1)  necessary to provide all or part of the money
441-25   required to:
441-26                     (A)  pay the principal of the obligations to be
441-27   refunded and the interest to accrue on those obligations to their
 442-1   maturity; or
 442-2                     (B)  redeem the obligations to be refunded,
 442-3   before maturity, on the date or dates the obligations are subject
 442-4   to redemption, including the principal, interest to accrue on the
 442-5   obligations to their redemption date or dates, and any required
 442-6   redemption premium; and
 442-7               (2)  sufficient to pay the expenses related to paying
 442-8   the obligations to be refunded.
 442-9         (b)  The refunding bonds shall be sold in the manner
442-10   determined by the municipality's governing body.  (V.A.C.S.
442-11   Art. 1118n-11, Sec. 4 (part).)
442-12         Sec. 1502.358.  REGISTRATION WITHOUT CANCELLATION OF
442-13   OBLIGATIONS TO BE REFUNDED.  The comptroller shall register
442-14   refunding bonds issued under this subchapter after the bonds have
442-15   been approved by the attorney general, without the surrender,
442-16   exchange, or cancellation of the obligations to be refunded.
442-17   (V.A.C.S. Art. 1118n-11, Sec. 3 (part).)
442-18         Sec. 1502.359.  REDEMPTION.  (a)  If an obligation to be
442-19   refunded by the sale of refunding bonds under this subchapter is
442-20   subject to redemption before maturity:
442-21               (1)  the obligation shall be called for redemption on
442-22   the date on which it is redeemable, according to its terms; and
442-23               (2)  the proceedings relating to the redemption call
442-24   and any required notice of redemption shall be submitted to the
442-25   attorney general with the proceedings authorizing the issuance of
442-26   the refunding bonds.
442-27         (b)  If notice of redemption for any obligation to be
 443-1   refunded is required by the terms of the obligation to be given or
 443-2   published at a time after the date of the refunding bonds:
 443-3               (1)  the obligation is not subject to redemption before
 443-4   maturity for the purposes of this subchapter; and
 443-5               (2)  the amount required to be deposited with the
 443-6   comptroller under this subchapter must be sufficient to pay the
 443-7   principal of and interest on the obligation to be refunded as the
 443-8   obligation comes due without being redeemed before maturity.
 443-9         (c)  This subsection applies only to refunding bonds payable
443-10   solely from the net revenue of the municipality's combined water,
443-11   sewer, and electric utility systems.  If an obligation to be
443-12   refunded is not callable at the time of refunding but will be
443-13   subject to redemption before maturity, the issuer may provide in
443-14   the refunding proceedings for redeeming the obligation before
443-15   maturity.  An issuer who provides for redemption before maturity
443-16   under this subsection is not required to deposit with the
443-17   comptroller under this subchapter an amount greater than the amount
443-18   necessary to pay the principal of and interest on the obligation as
443-19   it is redeemed.  (V.A.C.S. Art. 1118n-11, Secs. 2A(a), (d), 4
443-20   (part).)
443-21         Sec. 1502.360.  INVESTMENT OF PROCEEDS.  (a)  The
443-22   municipality may immediately invest all or any required part of the
443-23   proceeds from the bond sale, and any other necessary available
443-24   funds, in:
443-25               (1)  direct obligations of the United States;
443-26               (2)  obligations the principal of and interest on which
443-27   are unconditionally guaranteed by the United States; or
 444-1               (3)  obligations the attorney general of the United
 444-2   States has determined to be general obligations of the United
 444-3   States backed by its full faith and credit.
 444-4         (b)  An investment must mature, bear interest, and be
 444-5   payable, at times and in amounts that, combined with any uninvested
 444-6   money, will provide, without reinvestment, the money required to
 444-7   pay:
 444-8               (1)  the principal of and interest on the obligations
 444-9   to be refunded as those obligations come due;
444-10               (2)  the redemption price of obligations to be refunded
444-11   and redeemed before maturity, on the date on which the obligations
444-12   have been called for redemption; and
444-13               (3)  the additional amount required to pay the service
444-14   charges of any paying agent.
444-15         (c)  An investment must be made in a manner providing that
444-16   the investment proceeds, without reinvestment, will be  available
444-17   for deposit by the comptroller with the paying agent under Section
444-18   1502.365.  (V.A.C.S. Art. 1118n-11, Secs. 5, 6(a) (part).)
444-19         Sec. 1502.361.  DEPOSIT WITH COMPTROLLER.  The municipality
444-20   shall immediately deposit with the comptroller:
444-21               (1)  any proceeds from the bond sale that are not
444-22   invested as provided by Section 1502.360;
444-23               (2)  any investment made under Section 1502.360; and
444-24               (3)  any amount in addition to the deposits described
444-25   by Subdivisions (1) and (2) that is necessary to produce a total
444-26   amount sufficient to pay the principal of and interest on the
444-27   obligations to be refunded.  (V.A.C.S. Art. 1118n-11, Sec. 6(a)
 445-1   (part).)
 445-2         Sec. 1502.362.  CERTIFICATION OF DEPOSIT ADEQUACY.  (a)  The
 445-3   comptroller shall certify to the municipality as to the adequacy of
 445-4   the deposits made under Section 1502.361, considering the dates the
 445-5   principal of and interest on any investments will come due.
 445-6         (b)  In computing the adequacy of investments required to be
 445-7   deposited, the comptroller may rely on receiving both the principal
 445-8   and the interest scheduled to come due on the investments in
 445-9   accordance with the terms of the investments.  Any additional
445-10   amount that would be required to be  deposited if no interest were
445-11   scheduled to come due on the investments may be reduced
445-12   accordingly.
445-13         (c)  The comptroller may rely on a certificate by the chief
445-14   clerical officer of the municipality's governing body as to the
445-15   amount of the paying agent's service charges.  (V.A.C.S.
445-16   Art. 1118n-11, Sec. 6(a) (part).)
445-17         Sec. 1502.363.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS.
445-18   (a)  The comptroller shall:
445-19               (1)  accept each deposit of money, investments, or
445-20   proceeds of money or investments received under this subchapter;
445-21   and
445-22               (2)  safely keep and use the money, investments, or
445-23   proceeds only for a purpose specified in this subchapter.
445-24         (b)  Money, investments, or proceeds deposited with the
445-25   comptroller under this subchapter may not be:
445-26               (1)  used by or for the benefit of this state or for
445-27   the benefit of a creditor of this state, except as provided by
 446-1   Section 1502.367; or
 446-2               (2)  commingled with other money or investments.
 446-3         (c)  The comptroller shall collect promptly, when due and
 446-4   payable, all principal of and interest on investments deposited
 446-5   with the comptroller under this subchapter.
 446-6         (d)  The comptroller may not invest or reinvest any money
 446-7   deposited with or received by the comptroller from any investment
 446-8   under this subchapter.
 446-9         (e)  A bondholder, the municipality, or another interested
446-10   party may bring a writ of mandamus or use any other legal remedy to
446-11   require the comptroller to perform the comptroller's duties under
446-12   this subchapter.   (V.A.C.S. Art. 1118n-11, Secs. 6(a) (part), (b)
446-13   (part).)
446-14         Sec. 1502.364.  DEPOSITS TO BE HELD IN ESCROW; LIEN; TITLE.
446-15   (a)  The comptroller shall hold in escrow and in trust each deposit
446-16   of money or investments and proceeds of money or investments.
446-17         (b)  Each deposit, including proceeds, is charged with an
446-18   irrevocable first lien and pledge in favor of the holders of the
446-19   obligations to be paid from that deposit.
446-20         (c)  Each deposit, including proceeds, is public funds.
446-21   Until a deposit is paid out as provided by this subchapter, legal
446-22   title to the deposit is in the comptroller as trustee, and
446-23   equitable title is in the issuing municipality.  (V.A.C.S.
446-24   Art. 1118n-11, Sec. 6(b) (part).)
446-25         Sec. 1502.365.  DEPOSIT BY COMPTROLLER WITH PAYING AGENT;
446-26   PAYING AGENT'S DUTIES.  (a)  The comptroller shall deposit
446-27   investment proceeds with the paying agent, in current available
 447-1   funds, in the required amounts, not later than one business day
 447-2   before each scheduled maturity date, due date, or redemption date
 447-3   of the obligations being refunded.
 447-4         (b)  If there is more than one paying agent for an obligation
 447-5   being refunded under this subchapter, the comptroller shall make
 447-6   required deposits with:
 447-7               (1)  the paying agent located in this state having the
 447-8   largest capital and surplus; or
 447-9               (2)  the paying agent having the largest capital and
447-10   surplus, if no paying agent is located in this state and more than
447-11   one paying agent is located in another state.
447-12         (c)  If there is more than one paying agent, the agent with
447-13   whom the comptroller made the deposit under Subsection (b) shall
447-14   make the necessary money available to any other paying agent to pay
447-15   or redeem an obligation presented for payment or redemption.  The
447-16   comptroller shall instruct a paying agent regarding the agent's
447-17   duties under this subsection.  (V.A.C.S. Art. 1118n-11, Secs.  6(a)
447-18   (part), (c).)
447-19         Sec. 1502.366.  RETURN OF SURPLUS.  The comptroller shall
447-20   return to the issuing municipality any surplus that remains with
447-21   the comptroller in connection with a deposit of money or
447-22   investments under this subchapter after the comptroller has finally
447-23   performed all the comptroller's duties relating to the deposit
447-24   under this subchapter.  (V.A.C.S. Art. 1118n-11, Sec. 6(b) (part).)
447-25         Sec. 1502.367.  COMPTROLLER'S FEES.  The comptroller may
447-26   charge a reasonable fee for the comptroller's services under this
447-27   subchapter as authorized by Section 1207.032 for services performed
 448-1   under Chapter 1207.  (V.A.C.S. Art. 1118n-11, Sec. 6(a) (part).)
 448-2         Sec. 1502.368.  AUTHORITY TO DEPOSIT DIRECTLY WITH PAYING
 448-3   AGENT.  (a)  Instead of making a deposit with the comptroller as
 448-4   provided by Section 1502.361, a municipality may make the deposit
 448-5   described by that section directly with a paying agent for the
 448-6   obligations to be refunded if the paying agent:
 448-7               (1)  is a bank or trust company located in this state;
 448-8               (2)  has trust powers; and
 448-9               (3)  is a member of the Federal Reserve System.
448-10         (b)  Except as otherwise provided by this section, a paying
448-11   agent that receives a deposit under Subsection (a) shall act in the
448-12   same capacity as the comptroller to the extent appropriate and
448-13   shall perform the comptroller's duties under this subchapter.
448-14         (c)  The municipality and the paying agent shall enter into
448-15   an appropriate trust or escrow agreement under which a deposit made
448-16   under Subsection (a) shall be held for safekeeping, in escrow, and
448-17   in trust for the holders of the obligations to be refunded and is
448-18   charged with an irrevocable first lien in favor of and for the
448-19   benefit of the holders of those obligations.
448-20         (d)  A deposit of money made with a paying agent under
448-21   Subsection (a) is public funds and shall be secured at all times by
448-22   a pledge of:
448-23               (1)  direct obligations of the United States;
448-24               (2)  obligations the principal of and interest on which
448-25   are unconditionally guaranteed by the United States; or
448-26               (3)  obligations the  attorney general of the United
448-27   States has determined to be general obligations of the United
 449-1   States backed by its full faith and credit.
 449-2         (e)  If there is more than one paying agent for an obligation
 449-3   to be refunded, the paying agent that receives a deposit under
 449-4   Subsection (a) shall make the required current funds available, to
 449-5   the extent necessary, to each other paying agent to pay or redeem
 449-6   the obligation on presentment.  (V.A.C.S. Art. 1118n-11, Sec.  7.)
 449-7         Sec. 1502.369.  DISCHARGE AND FINAL PAYMENT; REDEMPTION;
 449-8   SUBORDINATION.  (a)  An initial deposit of money or investments
 449-9   with the comptroller or directly with a paying agent under this
449-10   subchapter constitutes the making of firm banking and financial
449-11   arrangements for the discharge and final payment or redemption of
449-12   the obligations to be refunded.
449-13         (b)  Obligations to be refunded continue to be obligations of
449-14   the municipality, but automatically on the making of the deposit:
449-15               (1)  the obligations become secured solely by and
449-16   payable solely from the deposit and proceeds of the deposit; and
449-17               (2)  any previous encumbrance existing in connection
449-18   with the obligations is finally discharged and released as a matter
449-19   of law.
449-20         (c)  Obligations to be refunded remain outstanding after the
449-21   deposit is made only for the purpose of receiving the funds
449-22   provided by the municipality for payment or redemption of the
449-23   obligations under this subchapter.  The obligations may not be
449-24   considered outstanding for any other purpose, including
449-25   ascertaining the municipality's power to issue bonds or computing
449-26   any limitations in connection with a municipality's issuance of
449-27   bonds.
 450-1         (d)  Notwithstanding Subsections (a)-(c), the municipality
 450-2   may provide in the proceedings authorizing the issuance of a
 450-3   refunding bond that the refunding bond is subordinate to the
 450-4   obligations to be refunded. The subordination may be made only in
 450-5   the manner and to the extent provided by those proceedings.
 450-6   (V.A.C.S. Art. 1118n-11, Sec. 8.)
 450-7         Sec. 1502.370.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT.
 450-8   The holder of an obligation to be refunded under this subchapter
 450-9   may not demand or receive payment of the obligation to be refunded
450-10   before its scheduled maturity date, due date, or redemption date
450-11   unless the proceedings authorizing the refunding bonds specifically
450-12   provide for the earlier payment.  (V.A.C.S. Art. 1118n-11, Sec. 9.)
450-13         Sec. 1502.371.  CONFLICT OR INCONSISTENCY WITH OTHER LAW OR
450-14   MUNICIPAL CHARTER.  When bonds are being issued under this
450-15   subchapter, to the extent of any conflict or inconsistency between
450-16   this subchapter and another law or a municipal charter, this
450-17   subchapter controls.  (V.A.C.S.  Art. 1118n-11, Sec. 11 (part).)
450-18           (Sections 1502.372-1502.400 reserved for expansion)
450-19       SUBCHAPTER I.  REFUNDING BONDS:  ELECTRIC UTILITY SYSTEM OR
450-20                     ELECTRIC AND GAS UTILITY SYSTEM
450-21         Sec. 1502.401.  APPLICABILITY OF SUBCHAPTER.  This subchapter
450-22   applies only to a municipality that has outstanding bonds or other
450-23   obligations secured solely by a pledge of the net revenue of, or by
450-24   a pledge of the net revenue of and a mortgage on, the
450-25   municipality's:
450-26               (1)  electric utility system; or
450-27               (2)  electric utility system and gas utility system.
 451-1   (V.A.C.S.  Art. 1118n-12, Sec. 1(a).)
 451-2         Sec. 1502.402.  CONSTRUCTION.  This subchapter shall be
 451-3   liberally construed to accomplish the purposes of this subchapter.
 451-4   (V.A.C.S. Art. 1118n-12, Sec. 13 (part).)
 451-5         Sec. 1502.403.  AUTHORITY TO ISSUE REFUNDING BONDS.  (a)  The
 451-6   governing body of a municipality may issue bonds to refund:
 451-7               (1)  all or any part of the outstanding bonds or other
 451-8   interest-bearing obligations secured solely by a pledge of the net
 451-9   revenue of, or by a pledge of the net revenue of and a mortgage on,
451-10   the municipality's:
451-11                     (A)  electric utility system; or
451-12                     (B)  electric utility system and gas utility
451-13   system; and
451-14               (2)  any interest coupons relating to obligations
451-15   described by Subdivision (1).
451-16         (b)  A municipality may issue refunding bonds under this
451-17   subchapter to refund part of an outstanding issue of bonds or other
451-18   interest-bearing obligations only if the municipality demonstrates
451-19   to the attorney general before the attorney general approves the
451-20   bonds that, based on then current conditions,  the municipality
451-21   will have adequate pledged resources available at the times
451-22   required to pay the unrefunded part of the issue.  (V.A.C.S.
451-23   Art. 1118n-12, Sec. 2 (part).)
451-24         Sec. 1502.404.  SOURCES AVAILABLE FOR PAYMENT.  (a)  Except
451-25   as provided by Subsection (b), refunding bonds issued under this
451-26   subchapter and the interest on the bonds and any redemption
451-27   premium, in the manner provided by the municipality's governing
 452-1   body, may be:
 452-2               (1)  secured by a first or subordinate lien on and
 452-3   pledge of, and made payable from:
 452-4                     (A)  the same source as the obligations to be
 452-5   refunded;
 452-6                     (B)  any other revenue, income, property, source,
 452-7   or resource of the governing body or the municipality; or
 452-8                     (C)  any combination of those sources or
 452-9   resources; and
452-10               (2)  additionally  secured by an instrument evidencing
452-11   a lien on any property.
452-12         (b)  A refunding bond issued under this subchapter may not be
452-13   secured by or made payable from any tax.  (V.A.C.S. Art. 1118n-12,
452-14   Sec. 2 (part).)
452-15         Sec. 1502.405.  COMBINATION ISSUANCE; SUBSEQUENT ISSUANCE.
452-16   (a)  Under the terms and with the security set forth in the
452-17   proceedings that authorize the issuance of the refunding bonds, a
452-18   municipality may issue refunding bonds:
452-19               (1)  in combination with new bonds;
452-20               (2)  with provision for the subsequent issuance of
452-21   additional parity bonds or subordinate lien bonds; or
452-22               (3)  both in combination with new bonds and with
452-23   provision for the subsequent issuance of additional bonds.
452-24         (b)  In combination with refunding bonds issued under this
452-25   subchapter a municipality may issue new bonds under this subchapter
452-26   for any purpose for which the municipality is authorized by law or
452-27   by home-rule charter to issue revenue bonds or other
 453-1   interest-bearing obligations.  (V.A.C.S. Art. 1118n-12, Sec. 2
 453-2   (part).)
 453-3         Sec. 1502.406.  ELECTION.  Refunding bonds may be issued
 453-4   without an election in connection with the issuance of the
 453-5   refunding bonds or the creation of an encumbrance in connection
 453-6   with the refunding bonds.  (V.A.C.S. Art. 1118n-12, Sec. 2 (part).)
 453-7         Sec. 1502.407.  MATURITY.  A bond issued under this
 453-8   subchapter must mature not later than 50 years after its date.
 453-9   (V.A.C.S. Art. 1118n-12, Sec. 2 (part).)
453-10         Sec. 1502.408.  ISSUANCE IN EXCHANGE FOR OBLIGATIONS TO BE
453-11   REFUNDED.  (a)  Refunding bonds may be issued to be exchanged under
453-12   this subchapter for, and on the surrender and cancellation of, the
453-13   obligations to be refunded.
453-14         (b)  The comptroller shall register a refunding bond and
453-15   deliver it to the holder of the obligation to be refunded, in
453-16   accordance with the proceedings authorizing the refunding bond.
453-17   The exchange may be made in one delivery or installment deliveries.
453-18   (V.A.C.S. Art. 1118n-12, Sec. 5 (part).)
453-19         Sec. 1502.409.  CASH SALE.  (a)  Instead of issuing refunding
453-20   bonds to be exchanged for the obligations to be refunded, the
453-21   governing body of a municipality may issue refunding bonds to be
453-22   sold for cash in a principal amount:
453-23               (1)  necessary to provide all or part of the money
453-24   required to:
453-25                     (A)  pay the principal of the obligations to be
453-26   refunded and the interest to accrue on those obligations to their
453-27   maturity; or
 454-1                     (B)  redeem the obligations to be refunded,
 454-2   before maturity, on the date or dates the obligations are subject
 454-3   to redemption, including the principal, interest to accrue on the
 454-4   obligations to their redemption date or dates, and any required
 454-5   redemption premium; and
 454-6               (2)  sufficient to:
 454-7                     (A)  pay the expenses related to the issuance of
 454-8   the bonds;
 454-9                     (B)  pay the expenses related to paying the
454-10   obligations to be refunded;
454-11                     (C)  provide any amount the governing body
454-12   considers necessary to fund deposits in:
454-13                           (i)  a debt service reserve fund;
454-14                           (ii)  an interest and sinking fund; or
454-15                           (iii)  any other fund created in the
454-16   proceedings authorizing the bonds;
454-17                     (D)  pay interest on all bonds issued under this
454-18   subchapter for the period prescribed by the governing body; and
454-19                     (E)  provide for any other amount the governing
454-20   body considers necessary.
454-21         (b)  The refunding bonds:
454-22               (1)  shall be sold under the terms and procedures for
454-23   the sale as determined by the governing body; and
454-24               (2)  may be sold at public or private sale.  (V.A.C.S.
454-25   Art. 1118n-12, Sec. 5 (part).)
454-26         Sec. 1502.410.  REGISTRATION WITHOUT CANCELLATION OF
454-27   OBLIGATIONS TO BE REFUNDED.  If a municipality's governing body
 455-1   authorizes refunding bonds or new bonds in combination with
 455-2   refunding bonds to be sold for cash under this subchapter, the
 455-3   comptroller shall register the refunding bonds and new bonds in
 455-4   combination with the refunding bonds after the bonds have been
 455-5   approved by the attorney general, without the surrender, exchange,
 455-6   or cancellation of the obligations to be refunded.  (V.A.C.S.
 455-7   Art. 1118n-12, Sec. 5 (part).)
 455-8         Sec. 1502.411.  REDEMPTION.  (a)  If an obligation to be
 455-9   refunded by the sale of bonds under this subchapter is subject to
455-10   redemption before maturity, the municipality's governing body may
455-11   call the obligation for redemption on any date on which it is
455-12   redeemable.
455-13         (b)  If the governing body calls an obligation for redemption
455-14   under this section, the proceedings relating to the call shall be
455-15   submitted to the attorney general along with the proceedings
455-16   authorizing the issuance of the refunding bonds.  (V.A.C.S.
455-17   Art. 1118n-12, Sec. 5 (part).)
455-18         Sec. 1502.412.  DEPOSIT WITH COMPTROLLER.  (a)  Except as
455-19   provided by Section 1502.413, after a refunding bond issued under
455-20   this subchapter is sold and delivered to the purchaser, the
455-21   municipality's governing body immediately shall deposit with the
455-22   comptroller, from the proceeds of the sale and any other funds
455-23   available for the purpose, the amount required to:
455-24               (1)  pay the principal of the obligations to be
455-25   refunded and the interest to accrue on those obligations to their
455-26   maturity; or
455-27               (2)  redeem the obligations to be refunded, before
 456-1   maturity, on the date or dates the obligations are subject to
 456-2   redemption, including the principal, interest to accrue on the
 456-3   obligations to their redemption date or dates, and any required
 456-4   redemption premium.
 456-5         (b)  The municipality shall file with the comptroller a
 456-6   certificate or other instrument or document that clearly shows:
 456-7               (1)  the date the principal of an obligation to be
 456-8   refunded matures and the principal amount;
 456-9               (2)  the date the interest on an obligation to be
456-10   refunded becomes due and the amount of the interest;
456-11               (3)  any date on which an obligation to be refunded has
456-12   been called for redemption before maturity;
456-13               (4)  the redemption price;
456-14               (5)  any paying agent for an obligation to be refunded;
456-15   and
456-16               (6)  the charges to be made by the paying agent for
456-17   paying and redeeming the obligation.
456-18         (c)  The comptroller may rely on a certificate or other
456-19   instrument or document filed under Subsection (b).  (V.A.C.S.
456-20   Art. 1118n-12, Sec. 6 (part).)
456-21         Sec. 1502.413.  INVESTMENT OF PROCEEDS.  (a)  Except as
456-22   provided by Subsection (d), instead of making the deposit required
456-23   by Section 1502.412, the municipality's governing body may
456-24   immediately invest all or any part of the proceeds from the bond
456-25   sale, and any other necessary available money, in:
456-26               (1)  direct obligations of the United States;
456-27               (2)  obligations the principal of and interest on which
 457-1   are unconditionally guaranteed by the United States; or
 457-2               (3)  obligations the attorney general of the United
 457-3   States has determined to be general obligations of the United
 457-4   States backed by its full faith and credit.
 457-5         (b)  An investment must mature, bear interest, and be payable
 457-6   at times and in amounts that, without  reinvestment and in addition
 457-7   to  any money initially deposited for the purpose, will provide the
 457-8   money required to pay:
 457-9               (1)  the principal of and interest on the obligations
457-10   to be refunded as those obligations come due;
457-11               (2)  the redemption price of obligations to be refunded
457-12   and redeemed before maturity, on the date on which the obligations
457-13   have been called for redemption, including principal, any interest
457-14   accrued to the redemption date, and any required redemption
457-15   premium; and
457-16               (3)  the additional amount required to pay the service
457-17   charges of any paying agent.
457-18         (c)  An investment must be made in such a manner that the
457-19   investment proceeds, without reinvestment, will be  available for
457-20   deposit by the comptroller with the paying agent under Section
457-21   1502.417.
457-22         (d)  The municipality shall deposit comptroller's fees in
457-23   cash with the comptroller regardless of whether the municipality
457-24   chooses to invest bond proceeds under this section.  (V.A.C.S.
457-25   Art. 1118n-12, Sec. 7 (part).)
457-26         Sec. 1502.414.  DEPOSIT OF INVESTMENTS WITH COMPTROLLER;
457-27   DEPOSIT ADEQUACY.  (a)  The municipality's governing body
 458-1   immediately shall deposit any investment made under Section
 458-2   1502.413 with the comptroller.
 458-3         (b)  In computing the amount of the investment required to be
 458-4   deposited, the municipality and the comptroller shall rely on
 458-5   receiving both the principal and any interest scheduled to mature
 458-6   and accrue or come due on the investment, to the extent that the
 458-7   principal and interest are scheduled to mature and accrue or come
 458-8   due before the maturity date, due date, or redemption date,
 458-9   respectively, of the obligations to be refunded.
458-10         (c)  Any amount that  would be required to be deposited if no
458-11   interest or increase were scheduled to accrue or come due may, at
458-12   the governing body's option, be reduced accordingly.  (V.A.C.S.
458-13   Art. 1118n-12, Sec. 7 (part).)
458-14         Sec. 1502.415.  COMPTROLLER TO ACCEPT AND KEEP SAFE DEPOSITS.
458-15   (a)  The comptroller shall:
458-16               (1)  accept each deposit of money, investments, or
458-17   proceeds of money or investments received under this subchapter;
458-18   and
458-19               (2)  safely keep and use the money, investments, or
458-20   proceeds only for a purpose specified in this subchapter.
458-21         (b)  Money, investments, or proceeds deposited with the
458-22   comptroller under this subchapter may not be:
458-23               (1)  used by or for the benefit of this state or for
458-24   the benefit of a creditor of this state, except as provided by
458-25   Section 1502.419; or
458-26               (2)  commingled with the general revenue fund of this
458-27   state or any other special funds or accounts held by the
 459-1   comptroller.
 459-2         (c)  The comptroller shall collect promptly, when due and
 459-3   payable, all principal of and interest on investments deposited
 459-4   with the comptroller under this subchapter.
 459-5         (d)  The comptroller may not invest or reinvest any money
 459-6   deposited with the comptroller or received by the comptroller from
 459-7   any investment deposited with the comptroller under this
 459-8   subchapter.
 459-9         (e)  The part of a deposit of money or investments or the
459-10   proceeds of money or investments that represents the amount paid
459-11   for the comptroller's fees is the only part of any deposit with the
459-12   comptroller under this subchapter that is in the state treasury.
459-13         (f)  A bondholder, the municipality, or another interested
459-14   party may bring a writ of mandamus or use any other legal or
459-15   equitable remedy to require the comptroller to perform the
459-16   comptroller's duties under this subchapter.  (V.A.C.S.
459-17   Art. 1118n-12, Secs. 7 (part), 8 (part).)
459-18         Sec. 1502.416.  DEPOSIT TO BE HELD IN ESCROW; LIEN; TITLE.
459-19   (a)  The comptroller shall hold in escrow and in trust each deposit
459-20   of money or investments and proceeds of money or investments on
459-21   behalf of the holders of the obligations to be paid from the
459-22   deposit.
459-23         (b)  Each deposit, including proceeds, is charged with an
459-24   irrevocable first lien and pledge in favor of the holders of the
459-25   obligations to be paid from that deposit.
459-26         (c)  Each deposit, including proceeds, is public funds.
459-27   Until a deposit is paid out as provided by this subchapter, legal
 460-1   title to the deposit is in the comptroller as trustee, and
 460-2   equitable title is in the issuing municipality.  (V.A.C.S.
 460-3   Art. 1118n-12, Sec.  8 (part).)
 460-4         Sec. 1502.417.  DEPOSIT BY COMPTROLLER WITH PAYING AGENT;
 460-5   PAYING AGENT'S DUTIES.  (a)  To pay the amounts required on each
 460-6   scheduled maturity date, due date, or redemption date of the
 460-7   obligations being refunded and the paying agent's service charges,
 460-8   the comptroller shall deposit the amounts required with the paying
 460-9   agent in current available funds not later than each scheduled
460-10   maturity date, due date, or redemption date from:
460-11               (1)  the deposit made under Section 1502.412, if the
460-12   bond sale proceeds are deposited with the comptroller under that
460-13   section; or
460-14               (2)  the investment proceeds, if the bond sale proceeds
460-15   are invested under Section 1502.413.
460-16         (b)  If there is more than one paying agent for an obligation
460-17   being refunded under this subchapter, the comptroller shall make
460-18   required deposits with:
460-19               (1)  the paying agent located in this state, if only
460-20   one paying agent is located in this state;
460-21               (2)  the paying agent located in this state having the
460-22   largest capital and surplus, if more than one paying agent is
460-23   located in this state; or
460-24               (3)  the paying agent having the largest capital and
460-25   surplus, if no paying agent is located in this state and more than
460-26   one paying agent is located in another state.
460-27         (c)  If there is more than one paying agent, the agent with
 461-1   whom the comptroller made the deposit under Subsection (b) shall
 461-2   make the necessary money available to any other paying agent to pay
 461-3   or redeem an obligation when due.  The comptroller shall instruct a
 461-4   paying agent regarding the agent's duties under this subsection.
 461-5   (V.A.C.S. Art. 1118n-12, Secs. 6 (part), 7 (part), 9 (part).)
 461-6         Sec. 1502.418.  RETURN OF SURPLUS.  The comptroller shall
 461-7   return to the issuing municipality any surplus that remains with
 461-8   the comptroller in connection with a deposit of money or
 461-9   investments under this subchapter or the proceeds of money or
461-10   investments deposited under this subchapter.  (V.A.C.S.
461-11   Art. 1118n-12, Sec.  8 (part).)
461-12         Sec. 1502.419.  COMPTROLLER'S FEES.  The comptroller may
461-13   charge a reasonable fee for the comptroller's services under this
461-14   subchapter as authorized by Section 1207.032 for services performed
461-15   under Chapter 1207.  (V.A.C.S. Art. 1118n-12, Sec. 6 (part).)
461-16         Sec. 1502.420.  AUTHORITY TO DEPOSIT DIRECTLY WITH PAYING
461-17   AGENT.  (a)  Instead of making a deposit with the comptroller as
461-18   provided by Section 1502.412 for bond proceeds or by Section
461-19   1502.414 for investments of bond proceeds, a municipality may
461-20   deposit bond proceeds or investments for the obligations to be
461-21   refunded directly with:
461-22               (1)  a paying agent for the obligations to be refunded;
461-23   or
461-24               (2)  the trustee under a trust indenture, trust
461-25   agreement, deed of trust, or other instrument securing the
461-26   obligations to be refunded.
461-27         (b)  Except as otherwise provided by this section, a paying
 462-1   agent or trustee that receives a deposit under Subsection (a) shall
 462-2   act in the same capacity as the comptroller and shall perform the
 462-3   comptroller's functions and duties under this subchapter to the
 462-4   extent appropriate.
 462-5         (c)  The municipality and the paying agent may enter into an
 462-6   appropriate trust or escrow agreement.  A deposit made under
 462-7   Subsection (a) shall be held for safekeeping, in escrow, and in
 462-8   trust for the holders of the obligations being refunded and is
 462-9   charged with an irrevocable first lien in favor of and for the
462-10   benefit of the holders of those obligations.
462-11         (d)  The agreement described in Subsection (c) may provide
462-12   that a deposit of money may be:
462-13               (1)  invested in obligations that are:
462-14                     (A)  direct obligations of the United States;
462-15                     (B)  obligations the interest on and principal of
462-16   which are unconditionally guaranteed by the United States; or
462-17                     (C)  obligations the  attorney general of the
462-18   United States has determined to be general obligations of the
462-19   United States backed by its full faith and credit; or
462-20               (2)  deposited in interest-bearing time deposits
462-21   secured at all times by an equal amount in market value of any of
462-22   the obligations described in Subdivision (1).
462-23         (e)  The agreement described in Subsection (c) shall provide
462-24   for deposits with each paying agent to pay or redeem the
462-25   obligations to be refunded when due and may provide that if the
462-26   amount of money and investments held in escrow exceeds the amount
462-27   required for purposes of this subchapter, the excess shall be
 463-1   transferred and delivered to the municipality or as directed by the
 463-2   municipality's governing body, to be used for any purpose
 463-3   authorized by law, including payment of revenue bonds issued under
 463-4   this subchapter or other law.
 463-5         (f)  Sections 1502.417(b) and (c) do not apply to a deposit
 463-6   made under this section.  (V.A.C.S. Art. 1118n-12, Secs. 9 (part),
 463-7   10.)
 463-8         Sec. 1502.421.  DISCHARGE AND FINAL PAYMENT; REDEMPTION;
 463-9   SUBORDINATION.  (a)  An initial deposit of money or investments
463-10   with the comptroller or directly with a paying agent or trustee
463-11   under this subchapter constitutes the making of firm banking and
463-12   financial arrangements for the discharge and final payment or
463-13   redemption of the obligations to be refunded.
463-14         (b)  Obligations to be refunded continue to be obligations of
463-15   the municipality, but automatically on the making of the deposit:
463-16               (1)  the obligations become secured solely by and
463-17   payable solely from the deposit and proceeds of the deposit; and
463-18               (2)  any previous encumbrance existing in connection
463-19   with the obligations is finally discharged and released as a matter
463-20   of law.
463-21         (c)  Obligations to be refunded remain outstanding after the
463-22   deposit is made only for the purpose of receiving the funds
463-23   provided by the municipality for payment or redemption of the
463-24   obligations under this subchapter.  The obligations may not be
463-25   considered outstanding for any other purpose, including
463-26   ascertaining the municipality's power to issue bonds or computing
463-27   any limitations in connection with a municipality's issuance of
 464-1   bonds.
 464-2         (d)  Notwithstanding Subsections (a)-(c), the municipality
 464-3   may provide in the proceedings authorizing the issuance of a
 464-4   refunding bond that the refunding bond is subordinate to the
 464-5   obligations to be refunded.  The subordination may be made only in
 464-6   the manner and to the extent provided by those proceedings.
 464-7   (V.A.C.S. Art. 1118n-12, Sec. 12.)
 464-8         Sec. 1502.422.  RIGHT TO DEMAND OR RECEIVE EARLY PAYMENT.
 464-9   The holder of an obligation to be refunded under this subchapter
464-10   may not demand or receive payment of the obligation to be refunded
464-11   before its scheduled maturity date, due date, or redemption date
464-12   unless the proceedings authorizing the refunding bonds specifically
464-13   provide for the earlier payment.  (V.A.C.S. Art. 1118n-12, Sec.
464-14   11.)
464-15         Sec. 1502.423.  CONFLICT OR INCONSISTENCY WITH OTHER LAW OR
464-16   MUNICIPAL CHARTER.  To the extent of any conflict or inconsistency
464-17   between this subchapter and another law or a municipal charter,
464-18   this subchapter controls.  (V.A.C.S.  Art. 1118n-12, Sec. 13
464-19   (part).)
464-20           (Sections 1502.424-1502.450 reserved for expansion)
464-21        SUBCHAPTER J.  COMBINED ISSUE OF REFUNDING AND ADDITIONAL
464-22            BONDS:  MUNICIPALITY IN COUNTY WITH POPULATION OF
464-23                             525,000 OR MORE
464-24         Sec. 1502.451.  APPLICABILITY OF SUBCHAPTER.  This subchapter
464-25   applies only to a municipality that:
464-26               (1)  is in a county with a population of 525,000 or
464-27   more; and
 465-1               (2)  has issued bonds, notes, warrants, or other
 465-2   obligations payable from the revenue of the municipality's water or
 465-3   sewer system or sewage disposal plant, or any combination of those
 465-4   systems, all or any part of which are outstanding.  (V.A.C.S.
 465-5   Art. 1118p, Sec. 1 (part).)
 465-6         Sec. 1502.452.  AUTHORITY TO ISSUE BONDS.  A municipality may
 465-7   issue new bonds payable from the net revenue of the municipality's
 465-8   water or sewer system or sewage disposal plant or any combination
 465-9   of those systems to:
465-10               (1)  refund outstanding bonds, warrants, notes, or
465-11   other obligations described by Section 1502.451(2); and
465-12               (2)  further build, improve, enlarge, extend, or repair
465-13   one or more of those systems.  (V.A.C.S.  Art. 1118p, Sec. 1
465-14   (part).)
465-15         Sec. 1502.453.  PLEDGE OF REVENUE.  A municipality may pledge
465-16   the net revenue of its water or sewer system or sewage disposal
465-17   plant or any combination of those systems to pay the principal of
465-18   and interest on the refunding and further construction bonds
465-19   authorized by Section 1502.452.  (V.A.C.S. Art. 1118p, Sec. 1
465-20   (part).)
465-21         Sec. 1502.454.  ENCUMBRANCE OF PHYSICAL PROPERTIES; GRANT OF
465-22   FRANCHISE.  The governing body of the municipality may:
465-23               (1)  encumber the physical properties of the system or
465-24   systems; and
465-25               (2)  grant a franchise to a purchaser under foreclosure
465-26   to operate the system or systems for a period not to exceed 20
465-27   years after purchase, subject to all laws regulating the same then
 466-1   in force.  (V.A.C.S.  Art. 1118p, Sec. 1 (part).)
 466-2         Sec. 1502.455.  DESIGNATION.  Bonds issued under this
 466-3   subchapter may be called "__________ Refunding and Further
 466-4   Construction Bonds."  (V.A.C.S. Art. 1118p, Sec. 2 (part).)
 466-5         Sec. 1502.456.  MATURITY.  A bond issued under this
 466-6   subchapter must mature not later than 30 years after its date.
 466-7   (V.A.C.S. Art. 1118p, Sec. 2 (part).)
 466-8         Sec. 1502.457.  ELECTION.  (a)  A municipality may not issue
 466-9   bonds under this subchapter unless the bonds have been authorized
466-10   by a majority vote of the qualified voters of the municipality in
466-11   an election held for that purpose.
466-12         (b)  The governing body of the municipality shall hold the
466-13   election in the manner required by law for an election to authorize
466-14   the issuance of tax-supported bonds.  (V.A.C.S. Art. 1118p, Sec.
466-15   3.)
466-16         Sec. 1502.458.  ORDER OF REGISTRATION BY COMPTROLLER.  (a)
466-17   The comptroller may register that part of the bonds issued under
466-18   this subchapter equal in principal amount to the outstanding bonds,
466-19   notes, warrants, and other obligations that are being refunded only
466-20   on surrender and cancellation of those obligations.
466-21         (b)  After all bonds, notes, warrants, and other obligations
466-22   that are being refunded have been surrendered and canceled, and an
466-23   equal amount of new bonds have been registered and delivered in
466-24   exchange for those obligations, the comptroller shall register the
466-25   remaining new bonds and deliver those bonds to the municipality's
466-26   mayor or in accordance with the mayor's order.
466-27         (c)  After registration and delivery, the municipality's
 467-1   governing body may sell the bonds and use the proceeds for the
 467-2   purposes authorized by Section 1502.452(2).  (V.A.C.S.  Art. 1118p,
 467-3   Sec. 4 (part).)
 467-4           (Sections 1502.459-1502.500 reserved for expansion)
 467-5          SUBCHAPTER K.  MISCELLANEOUS ADDITIONAL PARITY BONDS
 467-6         Sec. 1502.501.  ADDITIONAL BONDS TO EXTEND AND IMPROVE
 467-7   ELECTRIC AND GAS UTILITY SYSTEMS.  (a)  This section applies only
 467-8   to a municipality that has outstanding revenue bonds issued under
 467-9   Subchapter B or similar law:
467-10               (1)  to acquire the municipality's electric and gas
467-11   systems; or
467-12               (2)  to refund bonds issued for that purpose.
467-13         (b)  In the manner and to the extent authorized by the
467-14   ordinance or trust indenture authorizing the outstanding bonds, a
467-15   municipality, to extend and improve its electric and gas systems,
467-16   may issue additional bonds that are:
467-17               (1)  payable from the net revenue of its electric and
467-18   gas systems; and
467-19               (2)  on a parity with the outstanding bonds.
467-20         (c)  The municipality must publish notice of intent to issue
467-21   bonds under this section in the manner provided by Section
467-22   1253.022, except that the notice must describe by name and amount
467-23   outstanding any bond or other debt payable from the net revenue of
467-24   the electric and gas systems.
467-25         (d)  Notice not complying with Subsection (c) has no effect,
467-26   and another notice as required by that subsection must be given
467-27   before the bonds are authorized.
 468-1         (e)  The governing body of the municipality is not required
 468-2   to hold an election on issuance of the bonds unless a petition is
 468-3   filed in accordance with Section 1253.023.  The governing body
 468-4   shall hold an election in accordance with Section 1253.023 if a
 468-5   petition is filed.  The municipality may submit the question
 468-6   whether the bonds shall be issued:
 468-7               (1)  in a single proposition; and
 468-8               (2)  without designating the amount of bond proceeds to
 468-9   be spent on each system.
468-10         (f)  To the extent of a conflict between this section and
468-11   another law or a municipal charter, this section controls.
468-12   (V.A.C.S. Art. 1118t, Secs. 1, 2.)
468-13         Sec. 1502.502.  ADDITIONAL BONDS PAYABLE FROM WATER AND SEWER
468-14   SYSTEM AND SWIMMING POOL REVENUE.  A municipality that has
468-15   outstanding bonds payable from and secured by a pledge of revenue
468-16   of its waterworks system, sewer system, and swimming pool may issue
468-17   additional parity bonds payable from and secured by a pledge of the
468-18   waterworks and sewer system revenue and, at the municipality's
468-19   option, additionally secured by a pledge of the swimming pool
468-20   revenue if the municipality:
468-21               (1)  retained in the instrument authorizing the
468-22   outstanding bonds the right to issue additional parity bonds
468-23   payable from and secured by a pledge of the same revenue; and
468-24               (2)  holds an election that favors the issuance of the
468-25   additional bonds.  (V.A.C.S. Art. 1118u, Secs. 1, 2 (part).)
468-26            CHAPTER 1503.  OBLIGATIONS FOR MUNICIPAL AIRPORTS
468-27                SUBCHAPTER A.  REVENUE BONDS FOR AIRPORTS
 469-1   Sec. 1503.001.  AUTHORITY TO ISSUE REVENUE BONDS
 469-2   Sec. 1503.002.  BONDS PAYABLE FROM REVENUE
 469-3   Sec. 1503.003.  PLEDGE OF TAX FOR OPERATION AND MAINTENANCE
 469-4                     EXPENSES; PROCEEDS
 469-5   Sec. 1503.004.  CONTENTS OF ORDINANCE AUTHORIZING BONDS
 469-6   Sec. 1503.005.  ADOPTION AND EXECUTION OF DOCUMENTS
 469-7   Sec. 1503.006.  MATURITY
 469-8   Sec. 1503.007.  SIGNATURES
 469-9   Sec. 1503.008.  SALE OF BONDS
469-10   Sec. 1503.009.  INVESTMENT OF BOND PROCEEDS AND FUNDS
469-11   Sec. 1503.010.  REFUNDING BONDS
469-12   Sec. 1503.011.  APPLICABILITY OF OTHER LAW
469-13           (Sections 1503.012-1503.050 reserved for expansion)
469-14            SUBCHAPTER B.  BONDS AND WARRANTS FOR AIRPORTS IN
469-15           MUNICIPALITIES WITH POPULATION OF MORE THAN 40,000
469-16   Sec. 1503.051.  APPLICABILITY OF SUBCHAPTER
469-17   Sec. 1503.052.  DEFINITION
469-18   Sec. 1503.053.  AUTHORITY TO ISSUE BONDS AND WARRANTS
469-19   Sec. 1503.054.  PLEDGE OF REVENUE
469-20   Sec. 1503.055.  MATURITY
469-21   Sec. 1503.056.  LIMIT ON AMOUNT OF WARRANTS
469-22   Sec. 1503.057.  SALE OF WARRANTS
469-23   Sec. 1503.058.  ACTION TO COLLECT WARRANTS; EVIDENCE
469-24   Sec. 1503.059.  AUTHORITY TO IMPOSE TAX
469-25   Sec. 1503.060.  CHARGES FOR SERVICE OR FACILITY
469-26   Sec. 1503.061.  CONFLICT WITH OTHER LAW OR MUNICIPAL
469-27                     CHARTER
 470-1           (Sections 1503.062-1503.100 reserved for expansion)
 470-2       SUBCHAPTER C.  REVENUE BONDS FOR AIRPORTS IN MUNICIPALITIES
 470-3                   WITH POPULATION OF MORE THAN 70,000
 470-4   Sec. 1503.101.  APPLICABILITY OF SUBCHAPTER
 470-5   Sec. 1503.102.  AUTHORITY TO ISSUE REVENUE BONDS
 470-6   Sec. 1503.103.  PLEDGE OF REVENUE
 470-7   Sec. 1503.104.  LIEN ON AIRPORT
 470-8   Sec. 1503.105.  BONDS NOT PAYABLE FROM TAXES
 470-9   Sec. 1503.106.  MATURITY
470-10   Sec. 1503.107.  CHARGES FOR SERVICES; RESERVES
470-11   Sec. 1503.108.  REFUNDING BONDS
470-12   Sec. 1503.109.  PLEDGE AND USE OF PROCEEDS OF TAX BY
470-13                     MUNICIPALITIES WITH POPULATION OF 125,000
470-14                     OR MORE
470-15   Sec. 1503.110.  PLEDGE AND USE OF PROCEEDS OF TAX BY
470-16                     MUNICIPALITIES WITH POPULATION OF 200,000
470-17                     OR MORE
470-18           (Sections 1503.111-1503.150 reserved for expansion)
470-19                  SUBCHAPTER D. ENCUMBRANCE OF AIRPORTS
470-20         IN MUNICIPALITIES WITH POPULATION OF MORE THAN 160,000
470-21   Sec. 1503.151.  APPLICABILITY OF SUBCHAPTER
470-22   Sec. 1503.152.  PLEDGE OF INCOME
470-23   Sec. 1503.153.  ENCUMBRANCE OF AIRPORT
470-24   Sec. 1503.154.  GRANT OF FRANCHISE
470-25   Sec. 1503.155.  OBLIGATION NOT DEBT
470-26   Sec. 1503.156.  AUTHORITY TO ISSUE NOTES AND WARRANTS WITHOUT
470-27                     ELECTION
 471-1           (Sections 1503.157-1503.200 reserved for expansion)
 471-2         SUBCHAPTER E.  ADDITIONAL POWERS OF MUNICIPALITIES WITH
 471-3                    POPULATION OF 1.2 MILLION OR MORE
 471-4   Sec. 1503.201.  APPLICABILITY OF SUBCHAPTER
 471-5   Sec. 1503.202.  COMPETITIVE BIDS AND PAYMENT OR PERFORMANCE
 471-6                     BONDS NOT REQUIRED
 471-7   Sec. 1503.203.  PAYMENT OF PREVAILING WAGE RATES
 471-8            CHAPTER 1503.  OBLIGATIONS FOR MUNICIPAL AIRPORTS
 471-9                SUBCHAPTER A.  REVENUE BONDS FOR AIRPORTS
471-10         Sec. 1503.001.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  A
471-11   municipality by ordinance may issue revenue bonds to:
471-12               (1)  establish, improve, enlarge, extend, or repair:
471-13                     (A)  an airport of the municipality; or
471-14                     (B)  a building, improvement, landing field, or
471-15   other facility or service the municipality considers necessary,
471-16   desirable, or convenient for the efficient operation and
471-17   maintenance of an airport; or
471-18               (2)  acquire land for an airport.
471-19         (b)  The municipality shall issue the bonds in the manner
471-20   provided by Subchapter C.  (V.A.C.S. Art. 1269j-5.1, Sec. 2(a)
471-21   (part).)
471-22         Sec. 1503.002.  BONDS PAYABLE FROM REVENUE.  Bonds issued
471-23   under this subchapter must be payable from all or a designated part
471-24   of the revenue from the airport for which the bonds are issued, as
471-25   provided in the ordinance authorizing the bonds.  (V.A.C.S.
471-26   Art. 1269j-5.1, Sec. 2(a) (part).)
471-27         Sec. 1503.003.  PLEDGE OF TAX FOR OPERATION AND MAINTENANCE
 472-1   EXPENSES; PROCEEDS.  (a)  In addition to or instead of the pledge
 472-2   of revenue and income of the airport authorized by Subchapter C, a
 472-3   municipality may impose and pledge to the payment of the operation
 472-4   and maintenance expenses of the airport a continuing annual ad
 472-5   valorem tax at a rate sufficient for that purpose, as provided in
 472-6   the ordinance authorizing the issuance of bonds under this
 472-7   subchapter.
 472-8         (b)  A tax under this section:
 472-9               (1)  must be imposed at a rate within any limit
472-10   contained in the municipal charter; and
472-11               (2)  may not be used for the payment of the principal
472-12   of or interest on the bonds.
472-13         (c)  The proceeds of a tax pledged under this section shall
472-14   be used annually, to the extent required by or provided in the
472-15   ordinance authorizing the bonds, for the operation and maintenance
472-16   of the airport.  (V.A.C.S. Art. 1269j-5.1, Sec. 2(a) (part).)
472-17         Sec. 1503.004.  CONTENTS OF ORDINANCE AUTHORIZING BONDS.  (a)
472-18   The ordinance authorizing the issuance of bonds under this
472-19   subchapter may:
472-20               (1)  provide for the flow of funds and the
472-21   establishment and maintenance of an interest and sinking fund,
472-22   reserve fund, or other fund;
472-23               (2)  make additional covenants relating to the bonds
472-24   and pledged revenue and the operation and maintenance of the
472-25   improvement or facility the revenue of which is pledged, including
472-26   providing for the operation or lease of all or part of the
472-27   improvement or facility and the use or pledge of money derived from
 473-1   operation contracts and leases; or
 473-2               (3)  provide that the municipality will pay all or
 473-3   certain costs of operating and maintaining the airport from the
 473-4   proceeds of a tax imposed under Section 1503.003.
 473-5         (b)  The ordinance may:
 473-6               (1)  prohibit  the further issuance of additional bonds
 473-7   or other obligations payable from the pledged revenue; or
 473-8               (2)  reserve the right to issue additional bonds
 473-9   secured by a pledge of and payable from the revenue on a parity
473-10   with, or subordinate to, the lien and pledge in support of the
473-11   bonds being issued, subject to any condition provided by the
473-12   ordinance.
473-13         (c)  The ordinance may contain other provisions and
473-14   covenants.  (V.A.C.S. Art. 1269j-5.1, Secs. 2(a) (part), (b)
473-15   (part).)
473-16         Sec. 1503.005.  ADOPTION AND EXECUTION OF DOCUMENTS.  A
473-17   municipality may adopt or have executed any other proceeding or
473-18   instrument necessary or convenient for the issuance of bonds under
473-19   this subchapter.  (V.A.C.S. Art. 1269j-5.1, Sec. 2(b) (part).)
473-20         Sec. 1503.006.  MATURITY.  A bond issued under this
473-21   subchapter must mature not later than 40 years after its date.
473-22   (V.A.C.S. Art. 1269j-5.1, Secs. 2(d) (part), (e) (part).)
473-23         Sec. 1503.007.  SIGNATURES.  A bond issued under this
473-24   subchapter must be signed by the mayor of the municipality and
473-25   countersigned by the secretary or clerk of the municipality.
473-26   (V.A.C.S. Art. 1269j-5.1, Secs. 2(d) (part), (e) (part).)
473-27         Sec. 1503.008.  SALE OF BONDS.  A municipality may sell bonds
 474-1   issued under this subchapter under the terms determined by the
 474-2   governing body of the municipality to be the most advantageous and
 474-3   reasonably obtainable.  (V.A.C.S.  Art. 1269j-5.1, Sec.  2(d)
 474-4   (part).)
 474-5         Sec. 1503.009.  INVESTMENT OF BOND PROCEEDS AND FUNDS.  (a)
 474-6   The bond proceeds, until they are needed for the purpose for which
 474-7   the bonds were issued, may be invested in direct obligations of the
 474-8   United States, placed on time deposit, or both.
 474-9         (b)  Money in an interest and sinking fund, reserve fund, or
474-10   any other fund established or provided for in the ordinance
474-11   authorizing the bonds may be invested in the manner and in the
474-12   securities as provided in that ordinance. (Art. 1269j-5.1, Sec.
474-13   2(c) (part).)
474-14         Sec. 1503.010.  REFUNDING BONDS.  (a)  A municipality by
474-15   ordinance may issue revenue refunding bonds to refund original
474-16   bonds or refunding bonds issued under this subchapter or Subchapter
474-17   C.
474-18         (b)  The comptroller shall register the refunding bonds on
474-19   the surrender and cancellation of the bonds to be refunded.
474-20         (c)  In lieu of issuing bonds to be registered on the
474-21   surrender and cancellation of the bonds to be refunded, the
474-22   municipality, in the ordinance authorizing the issuance of the
474-23   refunding bonds, may provide for the sale of the refunding bonds
474-24   and the deposit of the proceeds at a place at which the bonds to be
474-25   refunded are payable.  In that case, the refunding bonds may be
474-26   issued in an amount sufficient to pay the interest on the bonds to
474-27   be refunded to their maturity date or option date, and the
 475-1   comptroller shall register the refunding bonds without the
 475-2   surrender and cancellation of the bonds to be refunded.  (V.A.C.S.
 475-3   Art. 1269j-5.1, Sec. 2(e) (part).)
 475-4         Sec. 1503.011.  APPLICABILITY OF OTHER LAW.  Except to the
 475-5   extent of a conflict with this subchapter,  Subchapter C applies to
 475-6   bonds issued under this subchapter.  (V.A.C.S. Art. 1269j-5.1, Sec.
 475-7   2(a) (part).)
 475-8           (Sections 1503.012-1503.050 reserved for expansion)
 475-9    SUBCHAPTER B.  BONDS AND WARRANTS FOR AIRPORTS IN MUNICIPALITIES
475-10                   WITH POPULATION OF MORE THAN 40,000
475-11         Sec. 1503.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
475-12   applies only to a municipality with a population of more than
475-13   40,000.  (V.A.C.S. Art. 1269j, Sec. 1 (part).)
475-14         Sec. 1503.052.  DEFINITION.  In this subchapter, "airport"
475-15   includes all land and any building or other improvement necessary
475-16   or convenient to establish or operate an airport, including land or
475-17   an improvement necessary to:
475-18               (1)  assemble or manufacture aircraft for military use
475-19   or another governmental purpose; or
475-20               (2)  provide housing or office space for employees
475-21   necessary or incidental to such purposes.  (V.A.C.S. Art. 1269j,
475-22   Sec. 1 (part).)
475-23         Sec. 1503.053.  AUTHORITY TO ISSUE BONDS AND WARRANTS.  (a)
475-24   A municipality may borrow money and may issue bonds and warrants to
475-25   finance all or part of the cost of acquiring, constructing,
475-26   improving, enlarging, extending, or repairing an airport.
475-27         (b)  Warrants may be authorized under this subchapter by
 476-1   ordinance.  A majority of all of the members of the governing body
 476-2   of the municipality, at the meeting at which the ordinance is
 476-3   introduced, may adopt the ordinance.  The ordinance takes effect
 476-4   immediately.
 476-5         (c)  A municipality that issues warrants under this
 476-6   subchapter must comply with the provisions of Chapter 252, Local
 476-7   Government Code, relating to bidders, notice of intention to issue
 476-8   the warrants, and the right to a referendum.  Except as provided by
 476-9   that chapter, an election is not necessary to authorize the
476-10   issuance of warrants under this subchapter.  (V.A.C.S. Art. 1269j,
476-11   Secs. 1 (part), 2 (part), 4.)
476-12         Sec. 1503.054.  PLEDGE OF REVENUE.  In addition to taxes, a
476-13   municipality may pledge to the timely payment of the principal of
476-14   and interest on warrants issued under this subchapter all or part
476-15   of the receipts derived from the operation of the airport,
476-16   including income, rent, revenue, and tolls.  (V.A.C.S. Art. 1269j,
476-17   Sec. 1 (part).)
476-18         Sec. 1503.055.  MATURITY.  Warrants issued under this
476-19   subchapter must mature annually in such amounts so that the
476-20   aggregate amount of principal and interest due in each year is
476-21   substantially equal over a period not to exceed 30 years after
476-22   their date.   (V.A.C.S. Art. 1269j, Sec. 2 (part).)
476-23         Sec. 1503.056.  LIMIT ON AMOUNT OF WARRANTS.  A municipality
476-24   may not issue warrants under this subchapter in an aggregate amount
476-25   in excess of $125,000.  (V.A.C.S.  Art. 1269j, Sec. 3.)
476-26         Sec. 1503.057.  SALE OF WARRANTS.  A municipality may sell
476-27   warrants issued under this subchapter at a public or private sale.
 477-1   (V.A.C.S. Art. 1269j, Sec. 2 (part).)
 477-2         Sec. 1503.058.  ACTION TO COLLECT WARRANTS; EVIDENCE.  In any
 477-3   action brought to enforce the collection of warrants issued under
 477-4   this subchapter that have been approved by the attorney general and
 477-5   registered by the comptroller, the certificate of the attorney
 477-6   general or a certified copy of the certificate shall be admitted as
 477-7   evidence of the validity of the warrants and the coupons attached
 477-8   to the warrants.  (V.A.C.S. Art. 1269j, Sec. 9 (part).)
 477-9         Sec. 1503.059.  AUTHORITY TO IMPOSE TAX.  (a)  A municipality
477-10   that issues warrants under this subchapter shall annually impose a
477-11   tax in an amount sufficient to pay when due the principal of and
477-12   interest on the warrants.  The tax shall be imposed and paid in the
477-13   same manner as other taxes of the municipality.
477-14         (b)  If the warrants are additionally secured by a pledge of
477-15   the receipts derived from the operation of the airport for which
477-16   the warrants are issued, the municipality may reduce the tax
477-17   imposed under this section by the amount of money available that is
477-18   pledged to the payment of the principal of and interest on the
477-19   warrants.  (V.A.C.S. Art. 1269j, Secs. 1 (part), 5.)
477-20         Sec. 1503.060.  CHARGES FOR SERVICE OR FACILITY.  (a)  The
477-21   governing body of a municipality that issues warrants under this
477-22   subchapter shall prescribe by ordinance and collect a reasonable
477-23   rate, rent, or other charge for the service or facility furnished
477-24   by the airport for which the warrants are issued.
477-25         (b)  The charges under Subsection (a)  must be in an amount
477-26   that will produce revenue sufficient to:
477-27               (1)  pay when due the principal of and interest on all
 478-1   warrants for which the revenue has been pledged, including
 478-2   reserves; and
 478-3               (2)  provide for all expenses of operation and
 478-4   maintenance of the airport for which the warrants were issued,
 478-5   including reserves.  (V.A.C.S. Art. 1269j, Secs. 1 (part), 6.)
 478-6         Sec. 1503.061.  CONFLICT WITH OTHER LAW OR MUNICIPAL CHARTER.
 478-7   To the extent of a conflict between this subchapter and another law
 478-8   or a municipal charter, this subchapter controls.  (V.A.C.S.
 478-9   Art. 1269j, Sec. 10 (part).)
478-10           (Sections 1503.062-1503.100 reserved for expansion)
478-11    SUBCHAPTER C.  REVENUE BONDS FOR AIRPORTS IN MUNICIPALITIES WITH
478-12                     POPULATION OF MORE THAN 70,000
478-13         Sec. 1503.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
478-14   applies only to a municipality with a  population of more than
478-15   70,000.  (V.A.C.S. Art. 1269j-5, Sec. 1 (part).)
478-16         Sec. 1503.102.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  In
478-17   this section, "improvement" includes the construction or
478-18   enlargement of a hangar or a related building for use by a tenant
478-19   or concessionaire of an airport, including a person, firm, or
478-20   corporation who furnishes repairs or other services to air
478-21   carriers.
478-22         (b)  The governing body of a municipality by ordinance may
478-23   issue revenue bonds for improving, enlarging, extending, or
478-24   repairing its airport. (V.A.C.S. Art. 1269j-5, Sec. 1 (part).)
478-25         Sec. 1503.103.  PLEDGE OF REVENUE.  (a)  Bonds issued under
478-26   this subchapter must be secured by a pledge of all or a designated
478-27   part of the revenue from the operation of the airport for which the
 479-1   bonds are issued, including rents for any hangar or building, as
 479-2   prescribed in the ordinance authorizing the bonds.
 479-3         (b)  To the extent that the revenue from the airport is
 479-4   pledged for the payment of outstanding revenue bonds, the pledge
 479-5   securing the bonds is inferior to the previous pledge.  (V.A.C.S.
 479-6   Art. 1269j-5, Sec. 1 (part).)
 479-7         Sec. 1503.104.  LIEN ON AIRPORT.  Subject to a limitation
 479-8   contained in a previous pledge, if any, and in addition to the
 479-9   pledge of revenue under Section 1503.103, the governing body of the
479-10   municipality may give a lien on all or part of the physical
479-11   property of the airport.  (V.A.C.S. Art. 1269j-5, Sec. 1 (part).)
479-12         Sec. 1503.105.  BONDS NOT PAYABLE FROM TAXES.  A municipality
479-13   may not use proceeds of a tax to pay the principal of or interest
479-14   on:
479-15               (1)  bonds issued under this subchapter; or
479-16               (2)  bonds issued to refund bonds issued under this
479-17   subchapter.  (V.A.C.S.  Art. 1269j-5, Sec. 2 (part).)
479-18         Sec. 1503.106.  MATURITY.  A bond issued under this
479-19   subchapter must mature not later than 30 years after its date.
479-20   (V.A.C.S. Art. 1269j-5, Sec. 3 (part).)
479-21         Sec. 1503.107.  CHARGES FOR SERVICES; RESERVES.  If the
479-22   governing body of a municipality pledges the revenue of a property
479-23   or facility of an airport to the payment of bonds issued under this
479-24   subchapter, the governing body shall impose and collect a charge
479-25   for services rendered in connection with the use of the property or
479-26   facility in an amount at least sufficient to:
479-27               (1)  provide for the maintenance and operation expenses
 480-1   of the property or facility;
 480-2               (2)  pay the principal of and interest on the bonds as
 480-3   required by the ordinance authorizing the bonds; and
 480-4               (3)  provide any reserve fund required by the ordinance
 480-5   authorizing the bonds.  (V.A.C.S. Art. 1269j-5, Sec. 2 (part).)
 480-6         Sec. 1503.108.  REFUNDING BONDS.  A municipality may issue
 480-7   refunding bonds to be exchanged for or to provide money to redeem
 480-8   bonds issued under this subchapter.  (V.A.C.S. Art. 1269j-5, Sec. 4
 480-9   (part).)
480-10         Sec. 1503.109.  PLEDGE AND USE OF PROCEEDS OF TAX BY
480-11   MUNICIPALITIES WITH POPULATION OF 125,000 OR MORE.  (a)  This
480-12   section applies only to a home-rule municipality that:
480-13               (1)  has a population of 125,000 or more; and
480-14               (2)  operates for airport purposes real property that
480-15   is owned, leased, or controlled by the municipality.
480-16         (b)  A municipality that issues bonds under this subchapter
480-17   or that issues bonds to refund bonds issued under this subchapter
480-18   may impose and pledge to the payment of the operation and
480-19   maintenance expenses of the airport all or part of the proceeds of
480-20   an ad valorem tax authorized by Section 22.051, Transportation
480-21   Code, to supplement the pledge of revenue for payment of the
480-22   operation and maintenance expenses and principal of and interest on
480-23   the bonds.
480-24         (c)  A municipality shall use annually the proceeds of a tax
480-25   pledged under Subsection (b) to the extent required by the
480-26   ordinance authorizing the issuance of the bonds to assure the
480-27   efficient operation and maintenance of the airport.
 481-1         (d)  In the proceedings authorizing the issuance of bonds, a
 481-2   municipality may covenant that the municipality will pay certain
 481-3   costs of operating and maintaining the airport for which the bonds
 481-4   were issued, as specified in the proceedings, from the proceeds of
 481-5   the tax prescribed by Subsection (b).  (V.A.C.S. Art. 1269j-5.2.)
 481-6         Sec. 1503.110.  PLEDGE AND USE OF PROCEEDS OF TAX BY
 481-7   MUNICIPALITIES WITH POPULATION OF 200,000 OR MORE.  (a) This
 481-8   section applies only to a home-rule municipality that:
 481-9               (1)  has a population of 200,000 or more; and
481-10               (2)  owns real property acquired for airport purposes
481-11   that is leased, wholly or partly, to an airport operating company
481-12   or corporation.
481-13         (b)  A municipality that issues bonds under this subchapter
481-14   to acquire improvements constructed by an airport operating company
481-15   or corporation or to further improve its airport, or that issues
481-16   bonds to refund bonds issued under this subchapter for those
481-17   purposes, may impose and pledge to the payment of the operation and
481-18   maintenance expenses of the airport all or part of the proceeds of
481-19   an ad valorem tax authorized by Section 22.051, Transportation
481-20   Code, in the manner provided by Section 1503.109.  (V.A.C.S.
481-21   Art. 1269h-2, Secs.  1, 2 (part).)
481-22           (Sections 1503.111-1503.150 reserved for expansion)
481-23                  SUBCHAPTER D. ENCUMBRANCE OF AIRPORTS
481-24         IN MUNICIPALITIES WITH POPULATION OF MORE THAN 160,000
481-25         Sec. 1503.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
481-26   applies only to a municipality with a population of more than
481-27   160,000.  (V.A.C.S. Art. 1269i, Secs. 1 (part), 2 (part).)
 482-1         Sec. 1503.152.  PLEDGE OF INCOME.  A municipality may pledge
 482-2   the income from its airport and anything the municipality acquires
 482-3   relating to the airport to secure the payment of money to:
 482-4               (1)  purchase the airport; or
 482-5               (2)  construct, improve, enlarge, extend, or repair a
 482-6   permanent improvement, including a building, repair shop, or other
 482-7   structure.  (V.A.C.S.  Art. 1269i, Sec. 2 (part).)
 482-8         Sec. 1503.153.  ENCUMBRANCE OF AIRPORT.  A municipality may
 482-9   encumber its airport and anything the municipality acquires
482-10   relating to the airport to secure the payment of money to:
482-11               (1)  purchase the airport; or
482-12               (2)  construct, improve, enlarge, extend, or repair a
482-13   permanent improvement, including a building, repair shop, or other
482-14   structure. (V.A.C.S. Art. 1269i, Sec. 1 (part).)
482-15         Sec. 1503.154.  GRANT OF FRANCHISE.  As additional security
482-16   for the encumbrance, a municipality that encumbers an airport under
482-17   Section 1503.153 may provide in the encumbrance for a grant, to the
482-18   purchaser under sale or foreclosure,  of a franchise to operate the
482-19   airport and the improvements situated on the airport for a term not
482-20   to exceed 30 years from the date of the purchase.  (V.A.C.S.
482-21   Art. 1269i, Secs. 1 (part), 2 (part).)
482-22         Sec. 1503.155.  OBLIGATION NOT DEBT.  An obligation described
482-23   by Section 1503.152 or 1503.153:
482-24               (1)  may be a charge only on the property encumbered;
482-25               (2)  is not a debt of the municipality; and
482-26               (3)  may not be included in determining the power of
482-27   the municipality to issue bonds for any purpose authorized by law.
 483-1   (V.A.C.S. Art. 1269i, Secs. 1 (part), 2 (part).)
 483-2         Sec. 1503.156.  AUTHORITY TO ISSUE NOTES AND WARRANTS WITHOUT
 483-3   ELECTION.  (a)  A municipality may issue notes or warrants in an
 483-4   amount not to exceed $100,000 for the purposes described by this
 483-5   subchapter without an election.
 483-6         (b)  To the extent of a conflict between this section and  a
 483-7   municipal charter, this section controls.  (V.A.C.S. Art. 1269i,
 483-8   Sec. 3.)
 483-9           (Sections 1503.157-1503.200 reserved for expansion)
483-10         SUBCHAPTER E.  ADDITIONAL POWERS OF MUNICIPALITIES WITH
483-11                    POPULATION OF 1.2 MILLION OR MORE
483-12         Sec. 1503.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
483-13   applies only to  a municipality with a population of 1.2 million or
483-14   more.  (V.A.C.S. Art. 1269j-5.3, Sec. 1.)
483-15         Sec. 1503.202.  COMPETITIVE BIDS AND PAYMENT OR PERFORMANCE
483-16   BONDS NOT REQUIRED.  (a)  A municipality that issues revenue bonds
483-17   to finance the construction or acquisition of a building,
483-18   improvement, or facility at an airport owned and operated by the
483-19   municipality may spend all or part of the bond proceeds without
483-20   inviting, advertising for, or otherwise requiring competitive bids
483-21   for constructing or acquiring the building, improvement, or
483-22   facility or  requiring or obtaining payment bonds or performance
483-23   bonds in connection with the construction or acquisition of the
483-24   building, improvement, or facility if:
483-25               (1)  the building, improvement, or facility is leased
483-26   by the municipality to a private entity under a lease agreement
483-27   under which the lessee is:
 484-1                     (A)  obligated to maintain the building,
 484-2   improvement, or facility solely at the lessee's expense; and
 484-3                     (B)  unconditionally obligated, for the term of
 484-4   the bonds, to make payments of net rent that are pledged to the
 484-5   payment of the bonds in an amount and at a time that is sufficient
 484-6   to provide for the timely payment of principal, interest,
 484-7   redemption premiums, and other expenses arising in connection with
 484-8   the payment of the bonds; and
 484-9               (2)  the bonds:
484-10                     (A)  provide by their terms that the bonds:
484-11                           (i)  are payable solely from net rent as
484-12   prescribed by Subsection (a)(1)(B); and
484-13                           (ii)  may not be repaid under any
484-14   circumstances from proceeds of a tax; and
484-15                     (B)  do not create or provide for the creation of
484-16   a lien on real property owned by the municipality.
484-17         (b)  This subchapter does not affect the obligation of a
484-18   municipality to obtain competitive bids or require a payment bond
484-19   or performance bond in connection with a contract for the
484-20   construction of a building, improvement, or facility if the
484-21   contract is awarded by the municipality.  (V.A.C.S. Art. 1269j-5.3,
484-22   Secs. 2(a), (b), (c), (d).)
484-23         Sec. 1503.203.  PAYMENT OF PREVAILING WAGE RATES.  An
484-24   expenditure of or agreement to spend bond proceeds covered by this
484-25   subchapter for the construction of a building, improvement, or
484-26   facility must be conditioned on the payment of not less than the
484-27   rate of per diem wages for work of a similar character in the
 485-1   municipality as determined by the governing body of the
 485-2   municipality under Chapter 2258.  (V.A.C.S. Art. 1269j-5.3, Sec.
 485-3   2(e).)
 485-4           CHAPTER 1504.  OBLIGATIONS FOR MUNICIPAL BUILDINGS
 485-5    SUBCHAPTER A.  REVENUE BONDS FOR CULTURAL OR ATHLETIC FACILITIES
 485-6   Sec. 1504.001.  AUTHORITY FOR CULTURAL OR ATHLETIC
 485-7                     FACILITIES
 485-8   Sec. 1504.002.  AUTHORITY TO ISSUE REVENUE BONDS
 485-9   Sec. 1504.003.  PLEDGE OF REVENUE
485-10   Sec. 1504.004.  LIEN ON FACILITY
485-11   Sec. 1504.005.  BONDS NOT PAYABLE FROM TAXES; EXCEPTION
485-12   Sec. 1504.006.  CONTENTS OF ORDINANCE AUTHORIZING BONDS
485-13   Sec. 1504.007.  ADOPTION AND EXECUTION OF DOCUMENTS
485-14   Sec. 1504.008.  MATURITY
485-15   Sec. 1504.009.  SIGNATURES
485-16   Sec. 1504.010.  SALE OF BONDS
485-17   Sec. 1504.011.  INVESTMENT OF BOND PROCEEDS AND FUNDS
485-18   Sec. 1504.012.  TERM OF CERTAIN LEASES
485-19   Sec. 1504.013.  CHARGES FOR SERVICES
485-20   Sec. 1504.014.  REFUNDING BONDS
485-21   Sec. 1504.015.  CONFLICT WITH MUNICIPAL CHARTER
485-22           (Sections 1504.016-1504.050 reserved for expansion)
485-23      SUBCHAPTER B.  REVENUE BONDS FOR BUILDINGS IN MUNICIPALITIES
485-24                   WITH POPULATION OF MORE THAN 50,000
485-25   Sec. 1504.051.  APPLICABILITY OF SUBCHAPTER
485-26   Sec. 1504.052.  AUTHORITY FOR MUNICIPAL BUILDINGS
485-27   Sec. 1504.053.  AUTHORITY TO ISSUE REVENUE BONDS
 486-1   Sec. 1504.054.  PLEDGE OF REVENUE
 486-2   Sec. 1504.055.  ELECTION
 486-3   Sec. 1504.056.  ELECTION PROPOSITION
 486-4   Sec. 1504.057.  CONTENTS OF ORDINANCE AUTHORIZING BONDS
 486-5   Sec. 1504.058.  MATURITY
 486-6   Sec. 1504.059.  ADDITIONAL BONDS
 486-7   Sec. 1504.060.  SEPARATE BOOKS AND ACCOUNTS REQUIRED
 486-8           (Sections 1504.061-1504.100 reserved for expansion)
 486-9        SUBCHAPTER C.  OBLIGATIONS FOR AUDITORIUMS AND EXHIBITION
486-10          FACILITIES IN MUNICIPALITIES WITH POPULATION OF MORE
486-11                              THAN 125,000
486-12   Sec. 1504.101.  APPLICABILITY OF SUBCHAPTER
486-13   Sec. 1504.102.  AUTHORITY FOR AUDITORIUMS AND EXHIBITION
486-14                     FACILITIES
486-15   Sec. 1504.103.  AUTHORITY TO ISSUE BONDS, NOTES, AND
486-16                     WARRANTS
486-17   Sec. 1504.104.  PLEDGE OF REVENUE
486-18   Sec. 1504.105.  OBLIGATIONS NOT PAYABLE FROM TAXES
486-19   Sec. 1504.106.  ELECTION
486-20   Sec. 1504.107.  OPERATING EXPENSES AS FIRST LIEN
486-21   Sec. 1504.108.  CHARGES FOR SERVICES
486-22   Sec. 1504.109.  USE OF REVENUE FOR OTHER PURPOSES
486-23                     PROHIBITED
486-24   Sec. 1504.110.  RECORDS
486-25   Sec. 1504.111.  ANNUAL REPORT
486-26   Sec. 1504.112.  OFFENSE
486-27   Sec. 1504.113.  CIVIL ENFORCEMENT
 487-1           (Sections 1504.114-1504.150 reserved for expansion)
 487-2       SUBCHAPTER D.  REVENUE BONDS FOR AIR CONDITIONING EQUIPMENT
 487-3      IN AUDITORIUMS OR THEATERS IN MUNICIPALITIES WITH POPULATION
 487-4                           OF 175,000 OR MORE
 487-5   Sec. 1504.151.  APPLICABILITY OF SUBCHAPTER
 487-6   Sec. 1504.152.  AUTHORITY TO ISSUE REVENUE BONDS
 487-7   Sec. 1504.153.  PLEDGE OF REVENUE
 487-8   Sec. 1504.154.  BONDS NOT PAYABLE FROM TAXES
 487-9   Sec. 1504.155.  ELECTION
487-10   Sec. 1504.156.  MATURITY
487-11   Sec. 1504.157.  SIGNATURES
487-12   Sec. 1504.158.  ADDITIONAL BONDS
487-13   Sec. 1504.159.  EXEMPTION FROM TAXATION
487-14   Sec. 1504.160.  PERSONNEL; OPERATION AND MAINTENANCE
487-15                     EXPENSES
487-16   Sec. 1504.161.  CHARGES FOR SERVICES; RESERVES
487-17           (Sections 1504.162-1504.200 reserved for expansion)
487-18        SUBCHAPTER E.  OBLIGATIONS FOR EXPOSITION AND CONVENTION
487-19       HALLS IN MUNICIPALITIES WITH POPULATION OF 290,000 OR MORE
487-20   Sec. 1504.201.  APPLICABILITY OF SUBCHAPTER
487-21   Sec. 1504.202.  AUTHORITY FOR EXPOSITION AND CONVENTION HALLS
487-22   Sec. 1504.203.  AUTHORITY TO ISSUE BONDS, NOTES, AND
487-23                     WARRANTS
487-24   Sec. 1504.204.  PLEDGE OF INCOME
487-25   Sec. 1504.205.  OBLIGATIONS NOT PAYABLE FROM TAXES
487-26   Sec. 1504.206.  OPERATING EXPENSES AS FIRST LIEN
487-27   Sec. 1504.207.  CHARGES FOR SERVICES
 488-1   Sec. 1504.208.  USE OF INCOME FOR OTHER PURPOSES
 488-2                     PROHIBITED
 488-3   Sec. 1504.209.  MANAGEMENT AND CONTROL
 488-4   Sec. 1504.210.  TRUSTEE
 488-5   Sec. 1504.211.  RECEIVER
 488-6   Sec. 1504.212.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE OR
 488-7                     OTHER ACTION
 488-8           (Sections 1504.213-1504.250 reserved for expansion)
 488-9    SUBCHAPTER F.  REVENUE BONDS FOR CULTURAL FACILITIES IN HOME-RULE
488-10          MUNICIPALITIES WITH POPULATION OF 1.2 MILLION OR MORE
488-11   Sec. 1504.251.  APPLICABILITY OF SUBCHAPTER
488-12   Sec. 1504.252.  AUTHORITY FOR CULTURAL AND PARKING
488-13                     FACILITIES
488-14   Sec. 1504.253.  AUTHORITY TO ISSUE REVENUE BONDS
488-15   Sec. 1504.254.  PLEDGE OF REVENUE
488-16   Sec. 1504.255.  LIEN ON FACILITY
488-17   Sec. 1504.256.  PLEDGE OF MIXED BEVERAGE TAX RECEIPTS
488-18   Sec. 1504.257.  SHORTAGE OF MIXED BEVERAGE TAX RECEIPTS
488-19   Sec. 1504.258.  ADDITIONAL USE OF MIXED BEVERAGE TAX
488-20                     RECEIPTS
488-21   Sec. 1504.259.  BONDS NOT PAYABLE FROM TAXES; EXCEPTION
488-22   Sec. 1504.260.  CONTENTS OF ORDINANCE AUTHORIZING BONDS
488-23   Sec. 1504.261.  ADOPTION AND EXECUTION OF DOCUMENTS
488-24   Sec. 1504.262.  SIGNATURES
488-25   Sec. 1504.263.  SALE OF BONDS
488-26   Sec. 1504.264.  INTERIM RECEIPTS
488-27   Sec. 1504.265.  USE OF BOND PROCEEDS
 489-1   Sec. 1504.266.  CHARGES FOR SERVICES
 489-2   Sec. 1504.267.  USE OF REVENUE
 489-3   Sec. 1504.268.  CONFLICT WITH MUNICIPAL CHARTER
 489-4           CHAPTER 1504.  OBLIGATIONS FOR MUNICIPAL BUILDINGS
 489-5              SUBCHAPTER A.  REVENUE BONDS FOR CULTURAL OR
 489-6                           ATHLETIC FACILITIES
 489-7         Sec. 1504.001.  AUTHORITY FOR CULTURAL OR ATHLETIC
 489-8   FACILITIES.  A municipality may establish, acquire, lease as lessee
 489-9   or lessor, construct, improve, enlarge, equip, repair, operate, or
489-10   maintain a cultural or athletic facility, including:
489-11               (1)  a civic center, auditorium, opera house, music
489-12   hall, exhibition hall, coliseum, museum, library, or other
489-13   municipal building;
489-14               (2)  a golf course, tennis court, or other similar
489-15   recreational facility;
489-16               (3)  a hotel owned by a municipality or a nonprofit
489-17   municipally sponsored local government corporation created under
489-18   Chapter 431, Transportation Code, that is located not more than
489-19   1,000 feet from a convention center owned by a municipality with a
489-20   population of 1,500,000 or more;
489-21               (4)  a historic hotel owned by a municipality or a
489-22   nonprofit municipally sponsored local government corporation
489-23   created under Chapter 431, Transportation Code, that is located not
489-24   more than one mile from a convention center owned by a municipality
489-25   with a population of 1,500,000 or more; or
489-26               (5)  a parking facility at or in the immediate vicinity
489-27   of a cultural or athletic facility described by Subdivisions
 490-1   (1)-(4) for use in connection with that facility for off-street
 490-2   parking or storage of motor vehicles or other conveyances.
 490-3   (V.A.C.S. Art. 1269j-4.1, Sec. 2(a) (part).)
 490-4         Sec. 1504.002.  AUTHORITY TO ISSUE REVENUE BONDS.  The
 490-5   governing body of a municipality  by ordinance may issue revenue
 490-6   bonds to provide all or part of the money to establish, acquire,
 490-7   construct, improve, enlarge, equip, or repair a facility described
 490-8   by Section 1504.001.  (V.A.C.S.  Art. 1269j-4.1, Secs. 3(a), (b)
 490-9   (part).)
490-10         Sec. 1504.003.  PLEDGE OF REVENUE.  (a)  Bonds issued under
490-11   this subchapter must be secured by a pledge of and be payable from
490-12   all or a designated part of the revenue from the facility for which
490-13   the bonds are issued, as provided in the ordinance authorizing the
490-14   issuance of the bonds.
490-15         (b)  The pledge securing the bonds is inferior to any
490-16   previous pledge of the revenue for the payment of revenue bonds or
490-17   revenue refunding bonds that are outstanding.
490-18         (c)  A municipality that leases as lessee a facility
490-19   described by Section 1504.001 may pledge all or part of the revenue
490-20   from the facility to the lease payments the municipality must make.
490-21   (V.A.C.S. Art. 1269j-4.1, Secs. 3(b) (part), (d).)
490-22         Sec. 1504.004.  LIEN ON FACILITY.  Subject to any limitation
490-23   contained in any previous pledge,  the governing body of the
490-24   municipality may, in addition to pledging the revenue from a
490-25   facility, give a lien on all or part of the physical property of
490-26   the facility acquired with the proceeds of bonds issued under this
490-27   subchapter.  (V.A.C.S. Art. 1269j-4.1, Sec.  3(b) (part).)
 491-1         Sec. 1504.005.  BONDS NOT PAYABLE FROM TAXES; EXCEPTION.  (a)
 491-2   The owner or holder of a bond issued under this subchapter is not
 491-3   entitled to demand payment of the principal of or interest on the
 491-4   bond from money raised by taxation.
 491-5         (b)  Subsection (a)  does not apply to a demand for payment
 491-6   from hotel occupancy taxes that are pledged under Chapter 351, Tax
 491-7   Code, to the payment of the bond.  (V.A.C.S. Art. 1269j-4.1, Sec.
 491-8   4.)
 491-9         Sec. 1504.006.  CONTENTS OF ORDINANCE AUTHORIZING BONDS.  (a)
491-10   The ordinance authorizing the issuance of bonds under this
491-11   subchapter may provide for the flow of funds and the establishment
491-12   and maintenance of an interest and sinking fund, reserve fund, or
491-13   other fund.
491-14         (b)  The ordinance may:
491-15               (1)  prohibit the issuance of additional bonds or other
491-16   obligations payable from the pledged revenue; or
491-17               (2)  reserve the right to issue additional bonds to be
491-18   secured by a pledge of and payable from the revenue on a parity
491-19   with, or subordinate to, the lien and pledge in support of the
491-20   bonds being issued, subject to the conditions prescribed by the
491-21   ordinance.
491-22         (c)  The ordinance may contain any other provision or
491-23   covenant, including a covenant with respect to the bonds, the
491-24   pledged revenue, or the operation or maintenance of the facility
491-25   the revenue of which is pledged.  The ordinance may provide for the
491-26   operation or lease of all or part of the facility and the use or
491-27   pledge of money derived from operation contracts and leases.
 492-1   (V.A.C.S. Art. 1269j-4.1, Sec. 5 (part).)
 492-2         Sec. 1504.007.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
 492-3   municipality may adopt and have executed any other proceeding or
 492-4   instrument necessary or convenient to the issuance of bonds under
 492-5   this subchapter. (V.A.C.S. Art. 1269j-4.1, Sec. 5 (part).)
 492-6         Sec. 1504.008.  MATURITY.  A bond issued under this
 492-7   subchapter must mature not later than 40 years after its date.
 492-8   (V.A.C.S. Art. 1269j-4.1, Secs. 7 (part), 8 (part).)
 492-9         Sec. 1504.009.  SIGNATURES.  A bond issued under this
492-10   subchapter must be signed by the mayor of the municipality and
492-11   countersigned by the secretary or clerk of the municipality.
492-12   (V.A.C.S. Art. 1269j-4.1, Sec. 7 (part).)
492-13         Sec. 1504.010.  SALE OF BONDS.  A municipality may sell bonds
492-14   issued under this subchapter under the terms the governing body of
492-15   the municipality determines to be the most advantageous and
492-16   reasonably obtainable.  (V.A.C.S. Art. 1269j-4.1, Sec. 7 (part).)
492-17         Sec. 1504.011.  INVESTMENT OF BOND PROCEEDS AND FUNDS.
492-18   (a)  The bond proceeds, until they are needed to implement the
492-19   purpose for which the bonds were issued, may be invested in direct
492-20   obligations of the United States, placed on time deposit, or both.
492-21         (b)  Money in an interest and sinking fund, reserve fund, or
492-22   any other fund established or provided for in the bond ordinance
492-23   may be invested in the manner and in the securities as provided in
492-24   the bond ordinance. (Art. 1269j-4.1, Sec. 6 (part).)
492-25         Sec. 1504.012.  TERM OF CERTAIN LEASES.  In a municipality
492-26   with a population of 1.5 million or more, a lease entered into
492-27   under Section 1504.001 may have a term not to exceed 60 years if:
 493-1               (1)  the lessee proposes to invest more than $20
 493-2   million to renovate or redevelop an existing civic center building
 493-3   and facilities that are used in connection with and are located at
 493-4   or in the immediate vicinity of that building; and
 493-5               (2)  the governing body of the municipality finds that:
 493-6                     (A)  the renovated or redeveloped building and
 493-7   facilities will generate additional revenue for the municipality;
 493-8   and
 493-9                     (B)  a term that exceeds 30 years is necessary to
493-10   enable the lessee to recoup its investment or to obtain financing
493-11   for the project.  (V.A.C.S. Art. 1269j-4.1, Sec. 2(b).)
493-12         Sec. 1504.013.  CHARGES FOR SERVICES.  The governing body of
493-13   the municipality shall impose and collect charges for the use of a
493-14   facility the revenue of which is pledged to secure bonds issued
493-15   under this subchapter, and for services provided in connection with
493-16   that use, in amounts at least sufficient to comply with each
493-17   covenant or provision in the ordinance authorizing the issuance of
493-18   the bonds.  (V.A.C.S. Art. 1269j-4.1, Sec. 3(c).)
493-19         Sec. 1504.014.  REFUNDING BONDS.  (a)  A municipality by
493-20   ordinance may issue revenue refunding bonds similarly secured to
493-21   refund either original bonds or revenue refunding bonds previously
493-22   issued by the municipality under this subchapter.
493-23         (b)  The refunding bonds shall be executed as provided by
493-24   this subchapter for original bonds.
493-25         (c)  The comptroller shall register the refunding bonds on
493-26   the surrender and cancellation of the bonds to be refunded.
493-27         (d)  In lieu of issuing bonds to be registered on the
 494-1   surrender and cancellation of the bonds to be refunded, the
 494-2   municipality, in the ordinance authorizing the issuance of the
 494-3   refunding bonds, may provide for the sale of the refunding bonds
 494-4   and the deposit of the proceeds in the place the bonds to be
 494-5   refunded are payable. In that case, the refunding bonds may be
 494-6   issued in an amount sufficient to pay the principal of and interest
 494-7   on the bonds to be refunded to their option or maturity date, and
 494-8   the comptroller shall register the refunding bonds without the
 494-9   surrender and cancellation of the bonds to be refunded. (V.A.C.S.
494-10   Art. 1269j-4.1, Sec. 8 (part).)
494-11         Sec. 1504.015.  CONFLICT WITH MUNICIPAL CHARTER.  To the
494-12   extent of a conflict between this subchapter and a municipal
494-13   charter, this subchapter controls.  (V.A.C.S. Art. 1269j-4.1, Sec.
494-14   10 (part).)
494-15           (Sections 1504.016-1504.050 reserved for expansion)
494-16              SUBCHAPTER B.  REVENUE BONDS FOR BUILDINGS IN
494-17           MUNICIPALITIES WITH POPULATION OF MORE THAN 50,000
494-18         Sec. 1504.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
494-19   applies only to a municipality with a population of more than
494-20   50,000 that owns and operates a natural gas distribution system
494-21   serving the residents of all or part of the municipality.
494-22   (V.A.C.S. Art. 1015h, Sec. 1 (part).)
494-23         Sec. 1504.052.  AUTHORITY FOR MUNICIPAL BUILDINGS.  A
494-24   municipality may purchase, construct, improve, equip, repair,
494-25   remodel, or enlarge:
494-26               (1)  a coliseum, exposition and convention hall, city
494-27   hall, or other public building; or
 495-1               (2)  a necessary site for a building described by
 495-2   Subdivision (1).  (V.A.C.S. Art. 1015h, Sec. 1 (part).)
 495-3         Sec. 1504.053.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  The
 495-4   governing body of a municipality by ordinance may issue revenue
 495-5   bonds to purchase, construct, improve, equip, repair, remodel, or
 495-6   enlarge:
 495-7               (1)  a building described by Section 1504.052; or
 495-8               (2)  a site for a building described by Section
 495-9   1504.052.
495-10         (b)  The governing body shall issue bonds under this
495-11   subchapter  in compliance with Chapter 1502, except as provided by
495-12   this subchapter.  (V.A.C.S. Art. 1015h, Secs. 1 (part), 2 (part).)
495-13         Sec. 1504.054.  PLEDGE OF REVENUE.  Bonds issued under this
495-14   subchapter may be secured by:
495-15               (1)  a pledge of the net revenue from the building for
495-16   which the bonds are issued; and
495-17               (2)  an additional pledge of all or part of the net
495-18   revenue from the municipality's gas distribution system. (V.A.C.S.
495-19   Art. 1015h, Sec. 2 (part).)
495-20         Sec. 1504.055.  ELECTION.  (a)  A municipality may not issue
495-21   bonds under this subchapter unless the bonds are authorized by a
495-22   majority of the qualified voters voting at an election held for
495-23   that purpose.
495-24         (b)  The governing body of the municipality shall hold an
495-25   election to issue bonds under this subchapter in the manner
495-26   provided for other bond elections in the municipality.  (V.A.C.S.
495-27   Art. 1015h, Sec. 2 (part).)
 496-1         Sec. 1504.056.  ELECTION PROPOSITION.  The governing body of
 496-2   the municipality may submit the issuance of bonds to provide money
 496-3   to acquire one or more buildings for one or more of the purposes
 496-4   described by Section 1504.052 as one proposition at an election if
 496-5   all the bonds included in the proposition are to be secured by a
 496-6   pledge of the same revenue.  (V.A.C.S. Art. 1015h, Sec. 2 (part).)
 496-7         Sec. 1504.057.  CONTENTS OF ORDINANCE AUTHORIZING BONDS.  The
 496-8   ordinance authorizing the issuance of bonds under this subchapter
 496-9   may contain provisions regarding:
496-10               (1)  the terms on which the revenue or a designated
496-11   part of the revenue is to be pledged;
496-12               (2)  the method of securing the payment of the bonds;
496-13               (3)  the use of the pledged revenue;
496-14               (4)  the establishment of reserves for depreciation,
496-15   replacements, and improvements;
496-16               (5)  the municipality's duties regarding the use,
496-17   maintenance, and operation of the facility the revenue of which is
496-18   pledged; and
496-19               (6)  the use by the municipality of surplus revenue for
496-20   any other lawful purpose.  (V.A.C.S. Art. 1015h, Secs. 3 (part), 4
496-21   (part).)
496-22         Sec. 1504.058.  MATURITY.  A bond issued under this
496-23   subchapter must mature not later than 30 years after its date.
496-24   (V.A.C.S. Art. 1015h, Sec. 2 (part).)
496-25         Sec. 1504.059.  ADDITIONAL BONDS.  (a)  The governing body of
496-26   a municipality may issue additional bonds for a purpose authorized
496-27   under Section 1504.052.  Additional bonds may be secured by a
 497-1   pledge of all or part of the net revenue that is pledged to the
 497-2   payment of outstanding bonds to the extent and in the manner
 497-3   permitted by the ordinance authorizing the outstanding bonds.
 497-4         (b)  The governing body may issue additional bonds only after
 497-5   issuance of the bonds is authorized at an election held as provided
 497-6   for an original issue.  (V.A.C.S. Art. 1015h, Sec. 4 (part).)
 497-7         Sec. 1504.060.  SEPARATE BOOKS AND ACCOUNTS REQUIRED.  The
 497-8   municipality shall maintain separate books and accounts for each
 497-9   property the revenue of which is pledged for the payment of bonds
497-10   issued under this subchapter.  (V.A.C.S. Art. 1015h, Sec. 3
497-11   (part).)
497-12           (Sections 1504.061-1504.100 reserved for expansion)
497-13        SUBCHAPTER C.  OBLIGATIONS FOR AUDITORIUMS AND EXHIBITION
497-14              FACILITIES IN MUNICIPALITIES WITH POPULATION
497-15                          OF MORE THAN 125,000
497-16         Sec. 1504.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
497-17   applies only to a municipality with a population of more than
497-18   125,000.  (V.A.C.S. Art. 1269j-4, Sec. 1 (part).)
497-19         Sec. 1504.102.  AUTHORITY FOR AUDITORIUMS AND EXHIBITION
497-20   FACILITIES.  A municipality may:
497-21               (1)  construct, purchase, or encumber a municipal
497-22   auditorium, exhibition hall, coliseum, or other building or
497-23   structure used for public gatherings;
497-24               (2)  encumber anything acquired or to be acquired that
497-25   relates to a building or structure described by Subdivision (1);
497-26               (3)  purchase additional real property and facilities
497-27   for a building or structure described by Subdivision (1);
 498-1               (4)  improve, enlarge, extend, or repair a building or
 498-2   structure described by Subdivision (1); or
 498-3               (5)  purchase equipment and appliances necessary in the
 498-4   operation of a building or structure described by Subdivision (1).
 498-5   (V.A.C.S.  Art. 1269j-4, Sec. 1 (part).)
 498-6         Sec. 1504.103.  AUTHORITY TO ISSUE BONDS, NOTES, AND
 498-7   WARRANTS.  A municipality may issue bonds, notes, or warrants to
 498-8   provide the money to purchase, construct, improve, enlarge, extend,
 498-9   repair, or equip a building or structure described by Section
498-10   1504.102.  (V.A.C.S.  Art. 1269j-4, Sec. 1 (part).)
498-11         Sec. 1504.104.  PLEDGE OF REVENUE.  A municipality may pledge
498-12   the revenue from a building or structure described by Section
498-13   1504.102 to the payment of an obligation issued under this
498-14   subchapter. (V.A.C.S.  Art. 1269j-4, Sec. 1 (part).)
498-15         Sec. 1504.105.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
498-16   obligation issued under this subchapter:
498-17               (1)  is not a debt of the municipality;
498-18               (2)  may be a charge only on the revenue pledged for
498-19   the payment of the obligation; and
498-20               (3)  may not be included in determining the power of
498-21   the municipality to issue bonds for any purpose authorized by law.
498-22         (b)  Each contract, bond, note, or other evidence of
498-23   indebtedness issued or included under this subchapter must contain
498-24   the following provision:  "The holder of this obligation is not
498-25   entitled to demand payment of this obligation out of any money
498-26   raised by taxation."  (V.A.C.S. Art. 1269j-4, Secs. 1 (part), 4
498-27   (part).)
 499-1         Sec. 1504.106.  ELECTION.  (a)  Unless authorized by a
 499-2   majority vote of the qualified voters of the municipality, a
 499-3   municipality may not:
 499-4               (1)  encumber a building or structure described by
 499-5   Section 1504.102 for more than $5,000, except for purchase money or
 499-6   to refund existing debt that was authorized by law; or
 499-7               (2)  sell a building or structure described by Section
 499-8   1504.102.
 499-9         (b)  The governing body shall hold an election under this
499-10   section in the manner provided for other bond elections in the
499-11   municipality. (V.A.C.S. Art. 1269j-4, Sec. 2.)
499-12         Sec. 1504.107.  OPERATING EXPENSES AS FIRST LIEN.  (a)  If
499-13   the revenue from a building or structure described by Section
499-14   1504.102 is encumbered under this subchapter, each expense of
499-15   operation and maintenance, including all salaries, labor,
499-16   materials, interest, repairs and additions necessary to provide
499-17   efficient service, and each proper item of expense, is a first lien
499-18   against that revenue.
499-19         (b)  An expense for a repair or addition is a first lien only
499-20   if, in the judgment of the governing body of the municipality, the
499-21   repair or addition is necessary to:
499-22               (1)  keep the building or structure in operation and
499-23   provide adequate service to the municipality and its residents; or
499-24               (2)  respond to a physical accident or condition that
499-25   would otherwise impair the original security.  (V.A.C.S.
499-26   Art. 1269j-4, Sec. 3 (part).)
499-27         Sec. 1504.108.  CHARGES FOR SERVICES.  (a)  A municipality
 500-1   shall impose and collect charges for the use of a building  or
 500-2   structure described by Section 1504.102 and for services provided
 500-3   in connection with that use in amounts at least sufficient to pay:
 500-4               (1)  all operating, maintenance, depreciation,
 500-5   replacement, improvement, and interest charges in connection with
 500-6   the building or structure;
 500-7               (2)  for an interest and sinking fund sufficient to pay
 500-8   any bonds issued to purchase, construct, or improve the building or
 500-9   structure; and
500-10               (3)  any outstanding debt against the building or
500-11   structure.
500-12         (b)  The rates charged for the use of and for services
500-13   provided in connection with the use of a building or structure
500-14   described by Section 1504.102 must be equal and uniform.  A
500-15   municipality may not allow any free use of or free service in
500-16   connection with the building or structure except for an activity or
500-17   institution operated by the municipality.  (V.A.C.S. Art. 1269j-4,
500-18   Sec. 3 (part).)
500-19         Sec. 1504.109.  USE OF REVENUE FOR OTHER PURPOSES PROHIBITED.
500-20   A municipality may not use the revenue from a building or structure
500-21   described by Section 1504.102 to pay any other debt, expense, or
500-22   obligation of the municipality until the debt secured by the
500-23   revenue is fully paid.  (V.A.C.S. Art. 1269j-4, Sec. 3 (part).)
500-24         Sec. 1504.110.  RECORDS.  The chief executive officer of the
500-25   municipality shall establish and maintain a complete system of
500-26   records that:
500-27               (1)  shows each free use of and free service provided
 501-1   in connection with the use of a building or structure described by
 501-2   Section 1504.102 and the value of the use or service; and
 501-3               (2)  shows separately the amounts spent and the amounts
 501-4   set aside for operation, salaries, labor, materials, repairs,
 501-5   maintenance, depreciation, replacements, additions, interest, and
 501-6   the creation of a sinking fund to pay the bonds and debt.
 501-7   (V.A.C.S.  Art. 1269j-4, Sec. 3 (part).)
 501-8         Sec. 1504.111.  ANNUAL REPORT.  (a)  Not later than February
 501-9   1 of each year, the superintendent or manager of a building or
501-10   structure described by Section 1504.102 shall file with the chief
501-11   executive officer of the municipality a detailed report of the
501-12   operation of the building or structure for the year ending on the
501-13   preceding January 1.
501-14         (b)  The report must show the total amount of money collected
501-15   and the balance due, and the total disbursements made and the
501-16   amounts remaining unpaid, resulting from the operation of the
501-17   building or structure during that year. (V.A.C.S.  Art. 1269j-4,
501-18   Sec. 3 (part).)
501-19         Sec. 1504.112.  OFFENSE.  (a)  A chief executive officer of a
501-20   municipality commits an offense if the chief executive officer
501-21   fails to:
501-22               (1)  establish the system of records required by
501-23   Section 1504.110 before the 91st day after the date the building or
501-24   structure is completed; or
501-25               (2)  maintain the system of records required by Section
501-26   1504.110.
501-27         (b)  A superintendent or manager of a building or structure
 502-1   described by Section 1504.102 commits an offense if the
 502-2   superintendent or manager fails to file a report required by
 502-3   Section 1504.111.
 502-4         (c)  An offense under this section is a misdemeanor
 502-5   punishable by a fine of not less than $100 or more than $1,000.
 502-6   (V.A.C.S.  Art. 1269j-4, Sec. 3 (part).)
 502-7         Sec. 1504.113.  CIVIL ENFORCEMENT.  A person who resides in a
 502-8   municipality and is a taxpayer or holder of an obligation issued
 502-9   under this subchapter and secured by the encumbered income of a
502-10   building or structure described by Section 1504.102 is entitled to
502-11   enforce the provisions of this subchapter by appropriate civil
502-12   action in a district court in the county in which the municipality
502-13   is located.  (V.A.C.S.  Art. 1269j-4, Sec. 3 (part).)
502-14           (Sections 1504.114-1504.150 reserved for expansion)
502-15     SUBCHAPTER D.  REVENUE BONDS FOR AIR CONDITIONING EQUIPMENT IN
502-16        AUDITORIUMS OR THEATERS IN MUNICIPALITIES WITH POPULATION
502-17                           OF 175,000 OR MORE
502-18         Sec. 1504.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
502-19   applies only to a municipality with a population of 175,000 or
502-20   more.  (V.A.C.S. Art. 835j, Sec. 1 (part).)
502-21         Sec. 1504.152.  AUTHORITY TO ISSUE REVENUE BONDS.  The
502-22   governing body of a municipality may issue revenue bonds to acquire
502-23   or install air conditioning equipment in an auditorium or theater
502-24   owned and operated by  the municipality.  (V.A.C.S. Art. 835j, Sec.
502-25   1 (part).)
502-26         Sec. 1504.153.  PLEDGE OF REVENUE.  (a)  In this section,
502-27   "net revenue" means gross revenue minus all operation and
 503-1   maintenance expenses.
 503-2         (b)  Bonds issued under this subchapter may be secured only
 503-3   by a pledge of and be payable from the net revenue from the
 503-4   auditorium or theater.  (V.A.C.S. Art. 835j, Sec. 1 (part).)
 503-5         Sec. 1504.154.  BONDS NOT PAYABLE FROM TAXES.  (a)  A bond
 503-6   issued under this subchapter:
 503-7               (1)  is not a debt of the municipality;
 503-8               (2)  may be a charge only on the revenue pledged for
 503-9   the payment of the bond; and
503-10               (3)  may not be included in determining the power of
503-11   the municipality to issue bonds payable from taxation.
503-12         (b)  A bond issued under this subchapter must contain on its
503-13   face the following provision:  "The holder of this obligation is
503-14   not entitled to demand payment of this obligation out of any money
503-15   raised by taxation."  (V.A.C.S. Art. 835j, Sec. 1 (part).)
503-16         Sec. 1504.155.  ELECTION.  A municipality may issue bonds
503-17   under this subchapter without an election, but the governing body
503-18   of the municipality may hold an election in compliance with Chapter
503-19   1251 to determine whether a majority of the qualified voters
503-20   approve the issuance of the bonds.  (V.A.C.S. Art. 835j, Sec. 2
503-21   (part).)
503-22         Sec. 1504.156.  MATURITY.  A bond issued under this
503-23   subchapter must:
503-24               (1)  be payable serially; and
503-25               (2)  mature not later than 40 years after its date.
503-26   (V.A.C.S. Art. 835j, Sec. 2 (part).)
503-27         Sec. 1504.157.  SIGNATURES.  A bond issued under this
 504-1   subchapter must be signed by the mayor of the municipality and
 504-2   countersigned by the secretary of the municipality.  (V.A.C.S.
 504-3   Art. 835j, Sec. 2 (part).)
 504-4         Sec. 1504.158.  ADDITIONAL BONDS.  While any bonds issued
 504-5   under this subchapter are outstanding, the municipality may not
 504-6   issue additional bonds of equal dignity against  the pledged
 504-7   revenue, except to the extent and in the manner expressly permitted
 504-8   in the ordinance authorizing the issuance of the outstanding bonds.
 504-9   (V.A.C.S. Art. 835j, Sec. 4.)
504-10         Sec. 1504.159.  EXEMPTION FROM TAXATION.  A bond issued under
504-11   this subchapter is exempt from taxation by this state or by a
504-12   municipal corporation or any other political subdivision of this
504-13   state.  (V.A.C.S.  Art. 835j, Sec. 5.)
504-14         Sec. 1504.160.  PERSONNEL; OPERATION AND MAINTENANCE
504-15   EXPENSES.  A municipality may employ personnel necessary to operate
504-16   and maintain a municipal auditorium or theater for which bonds are
504-17   issued under this subchapter.  The costs of operation and
504-18   maintenance are a first lien against the income from the operation
504-19   of the auditorium or theater.  (V.A.C.S. Art. 835j, Sec. 3 (part).)
504-20         Sec. 1504.161.  CHARGES FOR SERVICES; RESERVES.  (a)  While
504-21   the principal of or interest on a bond issued under this subchapter
504-22   is outstanding, the municipality shall impose and collect charges
504-23   for the use of the auditorium or theater in amounts at least
504-24   sufficient to:
504-25               (1)  pay all operating and maintenance expenses in
504-26   connection with the auditorium or theater;
504-27               (2)  pay the principal of and interest on the
 505-1   outstanding bonds as the principal matures and as the interest
 505-2   accrues; and
 505-3               (3)  establish and maintain any reserves prescribed in
 505-4   the ordinance authorizing the issuance of the bonds.
 505-5         (b)  Charges imposed under this section must be equal and
 505-6   uniform within classes defined by the governing body of the
 505-7   municipality.  (V.A.C.S. Art. 835j, Sec. 3 (part).)
 505-8           (Sections 1504.162-1504.200 reserved for expansion)
 505-9     SUBCHAPTER E.  OBLIGATIONS FOR EXPOSITION AND CONVENTION HALLS
505-10          IN MUNICIPALITIES WITH POPULATION OF 290,000 OR MORE
505-11         Sec. 1504.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
505-12   applies only to a municipality with a population of 290,000 or
505-13   more.  (V.A.C.S. Art. 1182e, Sec. 1 (part).)
505-14         Sec. 1504.202.  AUTHORITY FOR EXPOSITION AND CONVENTION
505-15   HALLS.  A municipality may purchase, construct, encumber, renovate,
505-16   or repair an exposition or convention hall.  (V.A.C.S. Art. 1182e,
505-17   Sec. 1 (part).)
505-18         Sec. 1504.203.  AUTHORITY TO ISSUE BONDS, NOTES, AND
505-19   WARRANTS.  A municipality may issue bonds, notes, or warrants to
505-20   evidence an obligation incurred to purchase, construct, renovate,
505-21   or repair an exposition or convention hall.  (V.A.C.S. Art. 1182e,
505-22   Sec. 1 (part).)
505-23         Sec. 1504.204.  PLEDGE OF INCOME.  A municipality may pledge
505-24   the income from an exposition or convention hall to the payment of
505-25   an obligation issued under this subchapter.  (V.A.C.S. Art. 1182e,
505-26   Sec. 1 (part).)
505-27         Sec. 1504.205.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
 506-1   obligation issued under this subchapter:
 506-2               (1)  is not a debt of the municipality;
 506-3               (2)  may be a charge only on the property of the
 506-4   exposition or convention hall encumbered; and
 506-5               (3)  may not be included in determining the power of
 506-6   the municipality to issue bonds for any purpose authorized by law.
 506-7         (b)  Each contract, bond, or note issued or executed under
 506-8   this subchapter must contain the following provision:  "The holder
 506-9   of this obligation is not entitled to demand payment of this
506-10   obligation out of any money raised by taxation."   (V.A.C.S.
506-11   Art. 1182e, Secs. 1 (part), 4.)
506-12         Sec. 1504.206.  OPERATING EXPENSES AS FIRST LIEN.  If the
506-13   income from an exposition or convention hall is encumbered under
506-14   this subchapter, each expense of operation and maintenance,
506-15   including all salaries, labor, materials, interest, repairs, and
506-16   additions necessary to properly maintain the exposition or
506-17   convention hall, and each proper item of expense, is a first lien
506-18   against that income. (V.A.C.S.  Art. 1182e, Sec. 3 (part).)
506-19         Sec. 1504.207.  CHARGES FOR SERVICES.  (a)  A municipality
506-20   shall impose and collect charges for the use of an encumbered
506-21   exposition or convention hall in amounts determined by the
506-22   governing body to be sufficient to pay:
506-23               (1)  all operating, maintenance, depreciation,
506-24   replacement, improvement, and interest charges in connection with
506-25   the hall;
506-26               (2)  for an interest and sinking fund sufficient to pay
506-27   any bonds issued to purchase, construct, or improve the hall; and
 507-1               (3)  any outstanding debt against the hall.
 507-2         (b)  A municipality may not allow any free use of or free
 507-3   service in connection with the exposition or convention hall.
 507-4   (V.A.C.S. Art. 1182e, Sec. 3 (part).)
 507-5         Sec. 1504.208.  USE OF INCOME FOR OTHER PURPOSES PROHIBITED.
 507-6   A municipality may not use the income from the exposition or
 507-7   convention hall to pay any other debt, expense, or obligation of
 507-8   the municipality until the debt secured by the income is fully
 507-9   paid.  (V.A.C.S. Art. 1182e, Sec. 8.)
507-10         Sec. 1504.209.  MANAGEMENT AND CONTROL.  (a)  The contract
507-11   under which an exposition or convention hall is encumbered must
507-12   provide that the governing body of the municipality shall manage
507-13   and control the hall during the time the hall is encumbered.
507-14         (b)  The governing body may:
507-15               (1)  adopt rules governing the use and rental of the
507-16   exposition or convention hall and for the payment of those rents;
507-17   and
507-18               (2)  provide penalties for:
507-19                     (A)  the violation of rules adopted under
507-20   Subdivision (1);
507-21                     (B)  the use of the hall without the consent or
507-22   knowledge of the authorities in charge of the hall; or
507-23                     (C)  any interference with, trespass on, or
507-24   injury to the hall or the property on which the hall is located.
507-25   (V.A.C.S. Art. 1182e, Sec. 5.)
507-26         Sec. 1504.210.  TRUSTEE.  A contract under which an
507-27   exposition or convention hall is encumbered may provide for:
 508-1               (1)  the selection of a trustee to sell the hall on a
 508-2   default in the payment of principal or interest or another default
 508-3   under the contract;
 508-4               (2)  the selection of a successor trustee, if the
 508-5   original trustee is disqualified or fails to act; and
 508-6               (3)  the collection by the trustee of a fee of not more
 508-7   than five percent of the principal.  (V.A.C.S. Art. 1182e, Sec. 6
 508-8   (part).)
 508-9         Sec. 1504.211.  RECEIVER.  (a)  The trustee may apply to a
508-10   court for the appointment of a receiver if:
508-11               (1)  the contract under which the exposition or
508-12   convention hall is encumbered provides for the appointment of a
508-13   receiver; and
508-14               (2)  there is a default in the payment of principal and
508-15   interest or another default under the contract that continues for
508-16   at least 30 days.
508-17         (b)  A receiver appointed under this section may, subject to
508-18   the order of the court:
508-19               (1)  enter and take possession of the exposition or
508-20   convention hall; and
508-21               (2)  operate and maintain the hall and apply the net
508-22   revenue to the liquidation of the debt.
508-23         (c)  The receiver may use or rent any part of the hall for
508-24   any purpose consistent with the continued use of the major part of
508-25   the hall as an exposition or convention hall, or, if authorized by
508-26   the court, rent the hall for any lawful use.
508-27         (d)  The receiver may rent all or any part of the exposition
 509-1   or convention hall to the municipality, and the municipality may
 509-2   lease the hall from the receiver.
 509-3         (e)  An exposition or convention hall that is operated by a
 509-4   receiver under this section is free from taxation until the debt
 509-5   secured by the hall is fully paid.
 509-6         (f)  All rights of the receiver and of any lessee or other
 509-7   person holding under the receiver end when the debt is paid or the
 509-8   trustee, in the exercise of the trustee's powers, sells the
 509-9   exposition or convention hall.  The trustee may agree with a person
509-10   leasing the hall from the receiver not to sell the hall during the
509-11   term of the person's lease.
509-12         (g)  If the principal of all the bonds has not been declared
509-13   due or if a declaration that the principal of all the bonds is due
509-14   is annulled under the contract under which the exposition or
509-15   convention hall is encumbered:
509-16               (1)  on application to the court, the rights of the
509-17   receiver may be terminated and the receiver discharged by remedy or
509-18   waiver of the default; and
509-19               (2)  the rights of a person leasing the hall from the
509-20   receiver are subject to adjudication and may be terminated or
509-21   adjusted by the court.  (V.A.C.S. Art. 1182e, Sec. 6 (part).)
509-22         Sec. 1504.212.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
509-23   OR OTHER ACTION.  (a)  Unless written notice is given to the
509-24   governing body of the municipality in accordance with this section
509-25   that there is a default in payment of any installment of principal
509-26   of or interest on an obligation issued under this subchapter and
509-27   that payment has been demanded:
 510-1               (1)  a collection fee may not accrue;
 510-2               (2)  a foreclosure proceeding may not be begun in a
 510-3   court or through a trustee; and
 510-4               (3)  an option to mature any part of the obligation
 510-5   because of the default may not be exercised.
 510-6         (b)  A notice under Subsection (a)  must be sent by prepaid
 510-7   registered mail to each member of the governing body of the
 510-8   municipality, addressed to the member at the post office in the
 510-9   municipality.
510-10         (c)  An action described by Subsection (a)  may not be taken
510-11   before the 91st day after the date the notice is mailed.
510-12         (d)  A payment of a delinquent installment of principal and
510-13   interest that is paid before the expiration of the period
510-14   prescribed by Subsection (c) and that is accompanied by a payment
510-15   of interest as prescribed in the contract, at a rate not to exceed
510-16   10 percent per year, from the date of default until the date of
510-17   payment, has the same effect as if paid on the date the installment
510-18   was originally due.  (V.A.C.S. Art. 1182e, Sec. 7.)
510-19           (Sections 1504.213-1504.250 reserved for expansion)
510-20         SUBCHAPTER F.  REVENUE BONDS FOR CULTURAL FACILITIES IN
510-21     HOME-RULE MUNICIPALITIES WITH POPULATION OF 1.2 MILLION OR MORE
510-22         Sec. 1504.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
510-23   applies only to a home-rule municipality with a population of 1.2
510-24   million or more.  (V.A.C.S. Art. 1182j, Sec. 1.)
510-25         Sec. 1504.252.  AUTHORITY FOR CULTURAL AND PARKING
510-26   FACILITIES.  A municipality may acquire sites for and establish,
510-27   acquire, lease as lessee or lessor, construct, improve, enlarge,
 511-1   equip, repair, operate, or maintain:
 511-2               (1)  a cultural facility, such as an opera house,
 511-3   ballet or symphony hall, theater, or similar building;
 511-4               (2)  a building combining cultural facilities listed in
 511-5   Subdivision (1); or
 511-6               (3)  a parking facility at or in the immediate vicinity
 511-7   of a cultural facility listed in Subdivision (1) for use in
 511-8   connection with that facility and otherwise for off-street parking
 511-9   or storage of motor vehicles or other conveyances.  (V.A.C.S.
511-10   Art. 1182j, Sec. 2(a) (part).)
511-11         Sec. 1504.253.  AUTHORITY TO ISSUE REVENUE BONDS.  The
511-12   governing body of a municipality by ordinance may issue revenue
511-13   bonds to provide all or part of the money to establish, acquire,
511-14   construct, improve, enlarge, equip, repair, operate, or maintain a
511-15   cultural or parking facility described by Section 1504.252.
511-16   (V.A.C.S. Art. 1182j, Secs. 3(a), (b) (part).)
511-17         Sec. 1504.254.  PLEDGE OF REVENUE.  (a)  Bonds issued under
511-18   this subchapter must be secured by a pledge of and be payable from
511-19   all or a designated part of the revenue from the cultural or
511-20   parking facility for which the bonds are issued, as provided in the
511-21   ordinance authorizing the issuance of the bonds.
511-22         (b)  The pledge securing the bonds is inferior to any
511-23   previous pledge of the revenue for the payment of revenue bonds or
511-24   refunding bonds that are outstanding.
511-25         (c)  A municipality that leases as lessee a cultural or
511-26   parking facility described by Section 1504.252 may pledge all or
511-27   part of the revenue from the facility to the lease payments the
 512-1   municipality must make.  (V.A.C.S. Art. 1182j, Secs. 3(b) (part),
 512-2   (d).)
 512-3         Sec. 1504.255.  LIEN ON FACILITY.  Subject to any limitation
 512-4   contained in any previous pledge, the governing body of the
 512-5   municipality may, in addition to pledging the revenue from a
 512-6   cultural or parking facility, give a lien on all or part of the
 512-7   physical property and facilities constructed or acquired with the
 512-8   proceeds of bonds issued under this subchapter.  (V.A.C.S.
 512-9   Art. 1182j, Sec.  3(b) (part).)
512-10         Sec. 1504.256.  PLEDGE OF MIXED BEVERAGE TAX RECEIPTS.  (a)
512-11   The governing body of a municipality by official action may pledge
512-12   for the purposes provided by this subchapter a portion of the mixed
512-13   beverage tax that is remitted to the municipality under Section
512-14   183.051, Tax Code.
512-15         (b)  The total amount of mixed beverage tax receipts pledged
512-16   under Subsection (a) may not exceed an amount equal to 1-1/2
512-17   percent of the gross receipts subject to taxation under Chapter
512-18   183, Tax Code, from permittees within the municipality.  (V.A.C.S.
512-19   Art. 1182j, Sec. 4(a).)
512-20         Sec. 1504.257.  SHORTAGE OF MIXED BEVERAGE TAX RECEIPTS.  If
512-21   at the time of a remittance of mixed beverage tax receipts by the
512-22   comptroller under Section 183.051, Tax Code, the amount collected
512-23   by the comptroller from permittees in a municipality that has
512-24   pledged a portion of its mixed beverage tax receipts under Section
512-25   1504.256 is less than the total amount required to be collected
512-26   from those permittees by Chapter 183, Tax Code, then the amount to
512-27   be pledged under Section 1504.256 is an amount equal to the total
 513-1   amount actually collected from permittees in the municipality
 513-2   multiplied by a fraction, the numerator of which is the amount of
 513-3   mixed beverage tax receipts pledged under Section 1504.256 for the
 513-4   quarterly period and the denominator of which is the total amount
 513-5   required to be collected from permittees in the municipality during
 513-6   that period.  (V.A.C.S. Art. 1182j, Sec. 4(c).)
 513-7         Sec. 1504.258.  ADDITIONAL USE OF MIXED BEVERAGE TAX
 513-8   RECEIPTS.  A municipality may spend money derived from the portion
 513-9   of the mixed beverage tax receipts authorized to be pledged under
513-10   Section 1504.256 for:
513-11               (1)  advertising and promotion of events to take place
513-12   in a cultural facility described by Section 1504.252;
513-13               (2)  the attraction of events to a cultural facility
513-14   described by Section 1504.252, either by the municipality or
513-15   through a contract with a person or organization selected by the
513-16   municipality; and
513-17               (3)  the encouragement, promotion, improvement, and
513-18   application of the cultural arts, including opera, ballet,
513-19   symphony, and theater, and the arts related to the presentation,
513-20   performance, execution, and exhibition of those major art forms.
513-21   (V.A.C.S. Art. 1182j, Sec. 2(b).)
513-22         Sec. 1504.259.  BONDS NOT PAYABLE FROM TAXES; EXCEPTION.  (a)
513-23   The owner or holder of a bond issued under this subchapter is not
513-24   entitled to demand payment of the principal of or interest on the
513-25   bond from money raised by taxation.
513-26         (b)  Subsection (a) does not apply to a demand for payment
513-27   from mixed beverage tax receipts that are pledged under Section
 514-1   1504.256.  (V.A.C.S. Art. 1182j, Sec.  6.)
 514-2         Sec. 1504.260.  CONTENTS OF ORDINANCE AUTHORIZING BONDS.  (a)
 514-3   The ordinance authorizing the issuance of bonds under this
 514-4   subchapter may provide for the flow of funds and the establishment
 514-5   and maintenance of an interest and sinking fund, reserve fund, or
 514-6   other fund.
 514-7         (b)  The ordinance may:
 514-8               (1)  prohibit the issuance of additional bonds or other
 514-9   obligations payable from the pledged revenue; or
514-10               (2)  reserve the right to issue additional bonds to be
514-11   secured by a pledge of and payable from the revenue on a parity
514-12   with, or subordinate to, the lien and pledge in support of the
514-13   bonds being issued, subject to the conditions prescribed by the
514-14   ordinance.
514-15         (c)  The ordinance may contain any other provision or
514-16   covenant, including a covenant with respect to the bonds, the
514-17   pledged revenue, or the operation or maintenance of the cultural or
514-18   parking facility the revenue of which is pledged.  The ordinance
514-19   may provide for the operation or lease of all or part of the
514-20   facility and the use or pledge of money derived from operation
514-21   contracts and leases.  (V.A.C.S. Art. 1182j, Sec. 8 (part).)
514-22         Sec. 1504.261.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
514-23   municipality may adopt and have executed any other proceeding or
514-24   instrument necessary or convenient to the issuance of bonds under
514-25   this subchapter.  (V.A.C.S. Art. 1182j, Sec. 8 (part).)
514-26         Sec. 1504.262.  SIGNATURES.  A bond issued under this
514-27   subchapter must be signed by the mayor of the municipality and
 515-1   countersigned by the secretary or clerk of the municipality.
 515-2   (V.A.C.S. Art. 1182j, Sec. 7 (part).)
 515-3         Sec. 1504.263.  SALE OF BONDS.  A municipality may sell bonds
 515-4   issued under this subchapter at public or private sale in the
 515-5   manner and on the terms provided by the ordinance under which the
 515-6   bonds are issued.  (V.A.C.S. Art. 1182j, Sec. 7 (part).)
 515-7         Sec. 1504.264.  INTERIM RECEIPTS.  Pending the preparation of
 515-8   a definitive bond, a municipality may provide to the purchaser of a
 515-9   bond sold under this subchapter an interim receipt or certificate
515-10   in the form and with the provisions specified in the ordinance
515-11   authorizing the issuance of the bonds.  (V.A.C.S. Art. 1182j, Sec.
515-12   7 (part).)
515-13         Sec. 1504.265.  USE OF BOND PROCEEDS.  From the proceeds of
515-14   bonds issued under this subchapter, a municipality may appropriate
515-15   or set aside amounts:
515-16               (1)  to pay interest and administrative and operating
515-17   expenses expected to accrue during the period of construction;
515-18               (2)  to be deposited into the reserve fund as provided
515-19   in the ordinance authorizing the issuance of the bonds; and
515-20               (3)  to pay all expenses incurred in the issuance,
515-21   sale, and delivery of the bonds.  (V.A.C.S. Art. 1182j, Sec.  9.)
515-22         Sec. 1504.266.  CHARGES FOR SERVICES.  The governing body of
515-23   the municipality shall impose and collect charges for the use of a
515-24   cultural or parking facility the revenue of which is pledged to
515-25   secure bonds issued under this subchapter, and for services
515-26   provided in connection with that use, in amounts at least
515-27   sufficient to comply with each covenant or provision in the
 516-1   ordinance authorizing the issuance of the bonds.  (V.A.C.S.
 516-2   Art. 1182j, Sec. 3(c).)
 516-3         Sec. 1504.267.  USE OF REVENUE.  (a)  A municipality shall
 516-4   use revenue derived from that portion of mixed beverage tax
 516-5   receipts authorized to be pledged under Section 1504.256 for the
 516-6   purposes described by Sections 1504.252 and 1504.258, including the
 516-7   pledge of that revenue to the payment of bonds issued for a purpose
 516-8   described by Section 1504.252.
 516-9         (b)  Amounts received by a municipality from that portion of
516-10   the mixed beverage tax receipts authorized to be pledged under
516-11   Section 1504.256 and pledged to the payment of bonds as provided by
516-12   Subsection (a) that exceed the amounts required by the ordinance
516-13   under which the bonds are issued may be used for any other purpose
516-14   described by Section 1504.252 or 1504.258.  The governing body of
516-15   the municipality may determine that any remaining amounts are
516-16   excess money and may use those amounts for any lawful purpose if
516-17   that use does not violate an ordinance adopted by the governing
516-18   body in connection with the issued bonds.  (V.A.C.S. Art. 1182j,
516-19   Sec. 5.)
516-20         Sec. 1504.268.  CONFLICT WITH MUNICIPAL CHARTER.  To the
516-21   extent of a conflict between this subchapter and a municipal
516-22   charter, this subchapter controls.  (V.A.C.S.  Art. 1182j, Sec. 12
516-23   (part).)
516-24          CHAPTER 1505.  OBLIGATIONS FOR COASTAL MUNICIPALITIES
516-25                           FOR COASTAL MATTERS
516-26             SUBCHAPTER A.  BONDS FOR HARBOR IMPROVEMENTS IN
516-27                 MUNICIPALITIES BORDERING GULF OF MEXICO
 517-1   Sec. 1505.001.  APPLICABILITY OF SUBCHAPTER
 517-2   Sec. 1505.002.  AUTHORITY TO ISSUE BONDS FOR HARBOR
 517-3                     IMPROVEMENTS
 517-4   Sec. 1505.003.  AMOUNT OF BONDS
 517-5   Sec. 1505.004.  SURPLUS BONDS
 517-6           (Sections 1505.005-1505.050 reserved for expansion)
 517-7       SUBCHAPTER B.  BONDS FOR NAVIGATIONAL FACILITIES IN CERTAIN
 517-8                         COASTAL MUNICIPALITIES
 517-9   Sec. 1505.051.  APPLICABILITY OF SUBCHAPTER
517-10   Sec. 1505.052.  DEFINITION
517-11   Sec. 1505.053.  AUTHORITY FOR NAVIGATIONAL FACILITIES
517-12   Sec. 1505.054.  AUTHORITY TO ISSUE BONDS
517-13   Sec. 1505.055.  AUTHORITY TO BORROW FROM UNITED STATES
517-14   Sec. 1505.056.  PAYMENT OF BONDS
517-15   Sec. 1505.057.  ENCUMBRANCE AS ADDITIONAL SECURITY
517-16   Sec. 1505.058.  ADDITIONAL SECURITY FOR PROJECT RELATED TO
517-17                     ACQUISITION OR CONSTRUCTION OF BRIDGE
517-18   Sec. 1505.059.  BONDS NOT PAYABLE FROM TAXES
517-19   Sec. 1505.060.  ESTIMATE OF PROJECT COST; NOTICE OF INTENTION
517-20                     TO APPROVE PROJECT AND ISSUE BONDS
517-21   Sec. 1505.061.  ELECTION
517-22   Sec. 1505.062.  CONTENTS OF ORDINANCE AUTHORIZING ISSUANCE
517-23                     OF BONDS
517-24   Sec. 1505.063.  MATURITY
517-25   Sec. 1505.064.  MEDIUM OF PAYMENT
517-26   Sec. 1505.065.  ADDITIONAL BONDS
517-27   Sec. 1505.066.  SALE OF BONDS
 518-1   Sec. 1505.067.  DEPOSIT OF BOND PROCEEDS
 518-2   Sec. 1505.068.  OPERATING EXPENSES AS FIRST LIEN
 518-3   Sec. 1505.069.  SALE OR LEASE OF RECLAIMED OR RECONSTRUCTED
 518-4                     LAND
 518-5   Sec. 1505.070.  CHARGES
 518-6   Sec. 1505.071.  DEPOSITS TO BOND AND INTEREST REDEMPTION
 518-7                     FUND
 518-8   Sec. 1505.072.  DISPOSITION OF CERTAIN SURPLUS MONEY
 518-9   Sec. 1505.073.  SEPARATE RECORDS
518-10   Sec. 1505.074.  REQUIRED PAYMENT FOR SERVICES RENDERED TO
518-11                     MUNICIPALITY
518-12   Sec. 1505.075.  AUTHORITY TO REGULATE OPERATION OF BRIDGES
518-13                     AND TRAFFIC ON BRIDGES
518-14   Sec. 1505.076.  COMMISSIONERS OF NAVIGATION DISTRICT
518-15   Sec. 1505.077.  AUTHORITY FOR COUNTY APPROPRIATIONS
518-16   Sec. 1505.078.  AUTHORITY FOR TEXAS DEPARTMENT OF
518-17                     TRANSPORTATION EXPENDITURES
518-18   Sec. 1505.079.  CERTAIN COUNTY AND MUNICIPAL EXPENDITURES NOT
518-19                     PROHIBITED
518-20   Sec. 1505.080.  UNEXPENDED BALANCE
518-21   Sec. 1505.081.  EXEMPTION FROM TAXATION
518-22           (Sections 1505.082-1505.100 reserved for expansion)
518-23    SUBCHAPTER C.  OBLIGATIONS FOR TOLL BRIDGES AND OTHER FACILITIES
518-24                    IN CERTAIN COASTAL MUNICIPALITIES
518-25   Sec. 1505.101.  APPLICABILITY OF SUBCHAPTER
518-26   Sec. 1505.102.  DEFINITIONS
518-27   Sec. 1505.103.  AUTHORITY TO ISSUE OBLIGATIONS FOR CERTAIN
 519-1                     FACILITIES
 519-2   Sec. 1505.104.  AUTHORITY TO BORROW MONEY
 519-3   Sec. 1505.105.  SECURITY FOR PAYMENT OF OBLIGATIONS
 519-4   Sec. 1505.106.  OBLIGATIONS NOT PAYABLE FROM TAXES
 519-5   Sec. 1505.107.  ELECTION
 519-6   Sec. 1505.108.  MATURITY
 519-7   Sec. 1505.109.  ACCOUNTS REQUIRED TO BE CREATED BY
 519-8                     ORDINANCE
 519-9   Sec. 1505.110.  OPERATING EXPENSES AS FIRST LIEN
519-10   Sec. 1505.111.  EXECUTION OF INDENTURE OR DEED OF TRUST
519-11   Sec. 1505.112.  AUTHORITY TO REMOVE OR DEMOLISH
519-12                     BRIDGE OR TUNNEL
519-13   Sec. 1505.113.  CONVERSION OF BRIDGE OR TUNNEL TO
519-14                     TOLL BRIDGE OR TUNNEL
519-15   Sec. 1505.114.  EMINENT DOMAIN
519-16   Sec. 1505.115.  COMMISSIONERS OF NAVIGATION DISTRICT
519-17           (Sections 1505.116-1505.150 reserved for expansion)
519-18         SUBCHAPTER D.  OBLIGATIONS FOR FISH MARKETS BY CERTAIN
519-19                         COASTAL MUNICIPALITIES
519-20   Sec. 1505.151.  APPLICABILITY OF SUBCHAPTER
519-21   Sec. 1505.152.  AUTHORITY TO ACQUIRE OR CONSTRUCT FISH
519-22                     MARKET
519-23   Sec. 1505.153.  AUTHORITY TO ISSUE OBLIGATIONS
519-24   Sec. 1505.154.  AUTHORITY TO ACCEPT LOANS AND GRANTS FROM
519-25                     UNITED STATES
519-26   Sec. 1505.155.  SECURITY FOR PAYMENT OF OBLIGATIONS
519-27   Sec. 1505.156.  OBLIGATIONS NOT PAYABLE FROM TAXES
 520-1   Sec. 1505.157.  MATURITY
 520-2   Sec. 1505.158.  OPERATING EXPENSES AS FIRST LIEN
 520-3   Sec. 1505.159.  USE OF REVENUE
 520-4   Sec. 1505.160.  SUBORDINATE OBLIGATIONS
 520-5   Sec. 1505.161.  LEASE AND SALE OF FACILITIES
 520-6           (Sections 1505.162-1505.200 reserved for expansion)
 520-7       SUBCHAPTER E.  BONDS FOR HARBOR IMPROVEMENTS AND FACILITIES
 520-8      IN COASTAL MUNICIPALITIES WITH POPULATION OF LESS THAN 12,000
 520-9   Sec. 1505.201.  APPLICABILITY OF SUBCHAPTER
520-10   Sec. 1505.202.  DEFINITIONS
520-11   Sec. 1505.203.  AUTHORITY TO ISSUE REVENUE BONDS
520-12   Sec. 1505.204.  AUTHORITY TO ACCEPT LOANS AND GRANTS
520-13   Sec. 1505.205.  LOCATION OF HARBOR IMPROVEMENT OR FACILITY
520-14   Sec. 1505.206.  PLEDGE OF REVENUE
520-15   Sec. 1505.207.  GRANT OF FRANCHISE
520-16   Sec. 1505.208.  BONDS NOT PAYABLE FROM TAXES
520-17   Sec. 1505.209.  ELECTION
520-18   Sec. 1505.210.  ADDITIONAL BONDS
520-19   Sec. 1505.211.  TRANSFER OF PLEDGED REVENUE
520-20   Sec. 1505.212.  RATES
520-21   Sec. 1505.213.  APPOINTMENT OF RECEIVER
520-22   Sec. 1505.214.  EXEMPTION FROM ASSESSMENT OR TAXATION
520-23   Sec. 1505.215.  AUTHORITY TO ISSUE REFUNDING BONDS
520-24   Sec. 1505.216.  TERMS OF ISSUANCE OF REFUNDING BONDS
520-25   Sec. 1505.217.  REGISTRATION OF REFUNDING BONDS BY
520-26                     COMPTROLLER
520-27           (Sections 1505.218-1505.250 reserved for expansion)
 521-1     SUBCHAPTER F.  BONDS FOR HARBOR, WHARF, AND DOCK FACILITIES IN
 521-2         COASTAL MUNICIPALITIES WITH POPULATION OF 5,000 OR LESS
 521-3   Sec. 1505.251.  APPLICABILITY OF SUBCHAPTER
 521-4   Sec. 1505.252.  AUTHORITY FOR HARBOR, WHARF, AND DOCK
 521-5                     FACILITIES
 521-6   Sec. 1505.253.  AUTHORITY TO ISSUE BONDS
 521-7   Sec. 1505.254.  ELECTION
 521-8          CHAPTER 1505.  OBLIGATIONS FOR COASTAL MUNICIPALITIES
 521-9                           FOR COASTAL MATTERS
521-10             SUBCHAPTER A.  BONDS FOR HARBOR IMPROVEMENTS IN
521-11                 MUNICIPALITIES BORDERING GULF OF MEXICO
521-12         Sec. 1505.001.  APPLICABILITY OF SUBCHAPTER.  This subchapter
521-13   applies only to a municipality that borders the Gulf of Mexico.
521-14   (V.A.C.S. Art. 835 (part).)
521-15         Sec. 1505.002.  AUTHORITY TO ISSUE BONDS FOR HARBOR
521-16   IMPROVEMENTS.  A municipality may issue bonds necessary to improve
521-17   or aid the improvement of a harbor of the municipality or a bar at
521-18   the entrance of the harbor.  (V.A.C.S. Art. 835 (part).)
521-19         Sec. 1505.003.  AMOUNT OF BONDS.  A municipality may issue
521-20   bonds under this subchapter in an amount:
521-21               (1)  the municipality considers necessary; and
521-22               (2)  that does not exceed a limit on debt set by the
521-23   municipal charter.  (V.A.C.S. Art. 835 (part).)
521-24         Sec. 1505.004.  SURPLUS BONDS.  A municipality may sell any
521-25   available bonds not needed for the purpose for which the bonds were
521-26   issued to improve or aid the improvement of a harbor of the
521-27   municipality or a bar at the entrance of the harbor.  (V.A.C.S.
 522-1   Art. 835 (part).)
 522-2           (Sections 1505.005-1505.050 reserved for expansion)
 522-3       SUBCHAPTER B.  BONDS FOR NAVIGATIONAL FACILITIES IN CERTAIN
 522-4                         COASTAL MUNICIPALITIES
 522-5         Sec. 1505.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 522-6   applies only to a municipality that:
 522-7               (1)  is located in a navigation district organized
 522-8   under the general laws of this state; and
 522-9               (2)  has a deepwater port located in the municipality.
522-10   (V.A.C.S. Art. 1187a, Sec. 1 (part).)
522-11         Sec. 1505.052.  DEFINITION.  In this subchapter, "project"
522-12   means:
522-13               (1)  a facility purchased, constructed, improved,
522-14   enlarged, or repaired by a municipality as described by Section
522-15   1505.053; and
522-16               (2)  land acquired or improved by a municipality as
522-17   described by Section 1505.053.  (New.)
522-18         Sec. 1505.053.  AUTHORITY FOR NAVIGATIONAL FACILITIES.  A
522-19   municipality may:
522-20               (1)  own, purchase, construct, operate, improve,
522-21   enlarge, repair, or maintain a bridge over or across any stream,
522-22   inlet, or arm of the Gulf of Mexico or entrance canal to the
522-23   deepwater port of the municipality that connects any of the public
522-24   streets, highways, or thoroughfares of the municipality;
522-25               (2)  own, purchase, construct, repair, maintain,
522-26   operate, or lease:
522-27                     (A)  a wharf, pier, pavilion, or boathouse; or
 523-1                     (B)  a dam, dyke, or spillway with a road or
 523-2   bridge on or over it to create a freshwater supply basin for
 523-3   domestic, irrigation, and other purposes in the navigation district
 523-4   in which the municipality is located or in a county adjacent to the
 523-5   freshwater basin;
 523-6               (3)  acquire, reclaim, reconstruct, or fill in any
 523-7   submerged land along the waterfront of the municipality and
 523-8   construct, operate, or maintain a water main, gas main, storm
 523-9   sewer, sanitary sewer, sidewalk, street, or similar improvement in
523-10   connection with that land;
523-11               (4)  construct a seawall, breakwater, or other shore
523-12   protection to protect the waterfront of the municipality; and
523-13               (5)  construct, reconstruct, maintain, operate, or
523-14   dredge a channel in connection with a deepwater port in aid of
523-15   navigation within the municipality.  (V.A.C.S. Art. 1187a, Sec. 1
523-16   (part).)
523-17         Sec. 1505.054.  AUTHORITY TO ISSUE BONDS.  A municipality may
523-18   borrow money and by ordinance may issue bonds for a purpose
523-19   described by Section 1505.053.  (V.A.C.S. Art. 1187a, Sec. 5
523-20   (part).)
523-21         Sec. 1505.055.  AUTHORITY TO BORROW FROM UNITED STATES.  (a)
523-22   To construct and maintain a project, a municipality may borrow
523-23   money from the United States or an agency of the United States
523-24   created for the purpose of making such a loan.
523-25         (b)  To obtain the loan, a municipality may encumber:
523-26               (1)  the property and facilities of the project
523-27   acquired or to be acquired;
 524-1               (2)  the revenue and income from the operation of the
 524-2   project acquired or to be acquired; and
 524-3               (3)  anything relating to the project acquired or to be
 524-4   acquired.
 524-5         (c)  As additional security for the loan, the municipality
 524-6   may:
 524-7               (1)  encumber the net revenue and income from the
 524-8   operation of all projects; and
 524-9               (2)  provide in the encumbrance for a grant, to a
524-10   purchaser under sale or foreclosure, of a franchise to operate the
524-11   encumbered project for a term not to exceed 20 years from the date
524-12   of purchase, subject to all laws regulating the same then in force.
524-13   (V.A.C.S.  Art. 1187a,  Sec. 28.)
524-14         Sec. 1505.056.  PAYMENT OF BONDS.  The principal of and
524-15   interest on bonds issued under this subchapter are payable solely
524-16   from revenue, including rents and other charges received from any
524-17   reclaimed or reconstructed land,  derived from the project for
524-18   which the bonds were issued.  (V.A.C.S. Art. 1187a, Sec. 5 (part).)
524-19         Sec. 1505.057.  ENCUMBRANCE AS ADDITIONAL SECURITY.  (a)  As
524-20   additional security for the payment of the principal of and
524-21   interest on bonds issued under this subchapter, a municipality may
524-22   encumber any part or all of a project undertaken with funds derived
524-23   from the bonds.
524-24         (b)  An encumbrance entered into under this section:
524-25               (1)  may provide for a grant, to a purchaser under sale
524-26   or foreclosure, of a franchise to operate the encumbered project
524-27   for a term not to exceed 20 years from the date of purchase,
 525-1   subject to all laws regulating the same then in force; and
 525-2               (2)  shall:
 525-3                     (A)  provide for a trustee to enforce
 525-4   foreclosure; and
 525-5                     (B)  provide the municipality with the option at
 525-6   any five-year period within the 20-year term after purchase to
 525-7   repurchase a project, other than reclaimed land acquired by an
 525-8   individual purchaser, under reasonable terms and at a reasonable
 525-9   price stated in the encumbrance.
525-10         (c)  Subject to Section 1505.076, the governing body of the
525-11   municipality shall manage and control a project while it is
525-12   encumbered under this section.  (V.A.C.S. Art. 1187a, Secs. 5
525-13   (part), 6 (part), 7, 8 (part).)
525-14         Sec. 1505.058.  ADDITIONAL SECURITY FOR PROJECT RELATED TO
525-15   ACQUISITION OR CONSTRUCTION OF BRIDGE.  As additional security, a
525-16   municipality that acquires or constructs a bridge using bonds
525-17   issued under this subchapter may  pledge revenue from any project
525-18   carried out in connection with the acquisition or construction of
525-19   the bridge, including revenue or income from any submerged land
525-20   reclaimed or reconstructed and any improvement built on the land,
525-21   including a water main, gas main, storm sewer, sanitary sewer,
525-22   sidewalk, or street.  (V.A.C.S. Art. 1187a, Sec. 5 (part).)
525-23         Sec. 1505.059.  BONDS NOT PAYABLE FROM TAXES.  (a)  A bond
525-24   issued under this subchapter:
525-25               (1)  is not a debt of the municipality within the
525-26   meaning of any state constitutional or statutory limitation; and
525-27               (2)  may not be included in determining the power of
 526-1   the municipality to issue bonds for any purpose authorized by law.
 526-2         (b)  Each bond and coupon issued under this subchapter must
 526-3   state on its face that:
 526-4               (1)  the bond or coupon is issued under this
 526-5   subchapter;
 526-6               (2)  the bond or coupon is not a debt of the
 526-7   municipality within the meaning of any state constitutional or
 526-8   statutory limitation; and
 526-9               (3)  the holder of the bond or coupon is not entitled
526-10   to demand payment of the bond or coupon from any money raised by
526-11   taxation.  (V.A.C.S. Art. 1187a, Sec. 5 (part).)
526-12         Sec. 1505.060.  ESTIMATE OF PROJECT COST; NOTICE OF INTENTION
526-13   TO APPROVE PROJECT AND ISSUE BONDS.  (a)  Before approving a
526-14   project under this subchapter, the governing body of the
526-15   municipality shall:
526-16               (1)  obtain an estimate of the cost of the project; and
526-17               (2)  give notice of its intention to approve the
526-18   project.
526-19         (b)  The notice must:
526-20               (1)  describe the proposed project;
526-21               (2)  state the estimated cost of the proposed project;
526-22               (3)  state the amount, location, and use or disposition
526-23   of any land to be reclaimed;
526-24               (4)  state the time the governing body proposes to
526-25   adopt the ordinance authorizing the proposed project and the
526-26   issuance of the bonds; and
526-27               (5)  refer to the right to petition for an election as
 527-1   authorized by Section 1505.061.
 527-2         (c)  The notice must be published in a newspaper of general
 527-3   circulation in the municipality once a week for four consecutive
 527-4   weeks, with the last publication being before the 20th day before
 527-5   the date set for authorization of the proposed project and issuance
 527-6   of the bonds.   (V.A.C.S. Art. 1187a, Sec.  4 (part).)
 527-7         Sec. 1505.061.  ELECTION.  (a)  If, before the time set for
 527-8   action on the ordinance authorizing the proposed project and the
 527-9   issuance of the bonds, a petition is filed with the municipal
527-10   secretary or municipal clerk requesting an election on the approval
527-11   of the project and the issuance of the bonds that is signed by at
527-12   least 100 registered voters of the municipality who are listed on
527-13   the most recent tax roll of the municipality as owning property,
527-14   the governing body of the municipality may not approve the project
527-15   or issue the bonds unless a proposition for the approval of the
527-16   project and the issuance of the bonds is approved by a majority of
527-17   the votes cast at an election held for that purpose.
527-18         (b)  The governing body shall conduct the election in the
527-19   manner provided by Chapter 1251.
527-20         (c)  The governing body may hold an election on approval of
527-21   the project and issuance of the bonds regardless of whether a
527-22   petition is filed.  (V.A.C.S. Art. 1187a, Sec. 4 (part).)
527-23         Sec. 1505.062.  CONTENTS OF ORDINANCE AUTHORIZING ISSUANCE OF
527-24   BONDS.      (a)  An ordinance authorizing the issuance of bonds for
527-25   a project under this subchapter must:
527-26               (1)  briefly describe the proposed project;
527-27               (2)  state the estimated cost of the project;
 528-1               (3)  include the amount, maximum rate of interest, time
 528-2   and place of payment, and other details in connection with the
 528-3   issuance;
 528-4               (4)  specify:
 528-5                     (A)  whether the project is to be operated on the
 528-6   basis of a calendar, operating, or fiscal year; and
 528-7                     (B)  the beginning and ending dates of that year;
 528-8               (5)  provide for:
 528-9                     (A)  an operation and maintenance account; and
528-10                     (B)  a bond and interest redemption fund; and
528-11               (6)  contain a substantial description of any franchise
528-12   provided in an encumbrance entered into under Section 1505.057.
528-13         (b)  The governing body of the municipality shall covenant in
528-14   the ordinance, and on the face of each bond issued under this
528-15   subchapter, to at all times maintain charges for services provided
528-16   by the project in amounts sufficient to:
528-17               (1)  pay:
528-18                     (A)  the principal of and interest on the bonds
528-19   when payable;
528-20                     (B)  administration and operation expenses; and
528-21                     (C)  expenses necessary to maintain the project;
528-22               (2)  create the bond and interest redemption fund; and
528-23               (3)  fund:
528-24                     (A)  a reserve for depreciation of the project;
528-25   and
528-26                     (B)  a reserve for improvements and extensions of
528-27   the project other than those necessary to maintain the project.
 529-1         (c)  In the ordinance, the municipality may provide for
 529-2   additional bonds for extensions and permanent improvements to the
 529-3   project.  (V.A.C.S. Art. 1187a, Secs. 5 (part), 6 (part), 16
 529-4   (part), 18 (part), 20 (part), 21.)
 529-5         Sec. 1505.063.  MATURITY.  A bond issued under this
 529-6   subchapter must mature not later than 45 years after its date.
 529-7   (V.A.C.S. Art.  1187a, Sec. 5 (part).)
 529-8         Sec. 1505.064.  MEDIUM OF PAYMENT.  A bond or coupon issued
 529-9   under this subchapter after October 27, 1977, may be made payable
529-10   in:
529-11               (1)  United States currency; or
529-12               (2)  gold coin of or equal to the standard of weight
529-13   and fineness existing on its date of payment.  (V.A.C.S.
529-14   Art. 1187a, Sec. 5 (part).)
529-15         Sec. 1505.065.  ADDITIONAL BONDS.  (a)  As provided in the
529-16   ordinance authorizing the issuance of bonds under this subchapter,
529-17   the municipality may issue and negotiate additional bonds as
529-18   necessary.
529-19         (b)  Additional bonds that are sold are on a parity with
529-20   bonds of the same issue.  (V.A.C.S. Art. 1187a, Sec. 16 (part).)
529-21         Sec. 1505.066.  SALE OF BONDS.  (a)  A municipality shall
529-22   sell bonds issued under this subchapter in the manner and under the
529-23   terms that the governing body of the municipality considers to be
529-24   in the best interest of the municipality.
529-25         (b)  A municipality may make payments under a contract for a
529-26   project in bonds issued under this subchapter.  (V.A.C.S.
529-27   Art. 1187a, Sec. 5 (part).)
 530-1         Sec. 1505.067.  DEPOSIT OF BOND PROCEEDS.  The governing body
 530-2   of a municipality that issues bonds under this subchapter shall:
 530-3               (1)  if practicable, require that:
 530-4                     (A)  the bond proceeds be deposited in an account
 530-5   in a bank that is a member of the Federal Reserve System; and
 530-6                     (B)  each deposit be secured by direct
 530-7   obligations of the United States that have an aggregate market
 530-8   value at least equal to the amount of proceeds then on deposit; or
 530-9               (2)  if it is not practicable for the bond proceeds to
530-10   be deposited as provided by Subdivision (1), deposit the proceeds
530-11   in a bank or other depository that will secure the deposit to the
530-12   governing body's satisfaction.  (V.A.C.S. Art. 1187a, Sec. 12.)
530-13         Sec. 1505.068.  OPERATING EXPENSES AS FIRST LIEN.  The
530-14   reasonable costs of administering and operating and the reasonable
530-15   expense of maintaining the project are a first lien against the
530-16   revenue and income from the operation of a project, superior to the
530-17   lien of any encumbrance on the project.  From the revenue of a
530-18   project, the municipality shall, monthly or more frequently if
530-19   necessary, first deposit to the credit of the operation and
530-20   maintenance account an amount sufficient to pay those expenses.
530-21   (V.A.C.S.  Art. 1187a, Secs. 19, 20 (part).)
530-22         Sec. 1505.069.  SALE OR LEASE OF RECLAIMED OR RECONSTRUCTED
530-23   LAND.  A municipality that reclaims or reconstructs submerged land
530-24   under this subchapter may:
530-25               (1)  sell, lease, or grant a franchise for the use of
530-26   the land; and
530-27               (2)  use revenue from the sale, lease, or franchise as
 531-1   provided by this subchapter.  (V.A.C.S. Art. 1187a, Sec. 1 (part).)
 531-2         Sec. 1505.070.  CHARGES.  (a)  The governing body of a
 531-3   municipality shall set and at all times maintain charges for
 531-4   services and facilities of the project, and for the sale of
 531-5   reclaimed land, in amounts sufficient to pay, create, or fund, as
 531-6   appropriate, each item listed in Section 1505.062(b).
 531-7         (b)  A state bureau, board, commission, agency, or
 531-8   instrumentality may not supervise or regulate the amount of a
 531-9   charge of the municipality.   This subchapter does not affect a
531-10   power or duty of the Texas Board of Health. (V.A.C.S. Art. 1187a,
531-11   Secs.  18 (part), 25.)
531-12         Sec. 1505.071.  DEPOSITS TO BOND AND INTEREST REDEMPTION
531-13   FUND.  (a)  The municipality shall, monthly or more frequently if
531-14   necessary, deposit to the credit of the bond and interest
531-15   redemption fund an amount of money from the gross income and
531-16   revenue of the project sufficient to pay, when due, the principal
531-17   of and interest on the bonds.
531-18         (b)  The governing body of the municipality may deposit a
531-19   reasonable amount to the credit of the bond and interest redemption
531-20   fund in excess of the amount required to pay bonds maturing during
531-21   the earlier years of maturities of the bonds to provide a reserve
531-22   fund to prevent a deficiency in payment of bonds maturing in later
531-23   years. (V.A.C.S. Art. 1187a, Sec. 20 (part).)
531-24         Sec. 1505.072.  DISPOSITION OF CERTAIN SURPLUS MONEY.  The
531-25   governing body of the municipality may provide for the disposition
531-26   of surplus money in the operation and maintenance account or a
531-27   depreciation account by having the money:
 532-1               (1)  transferred to the bond and interest redemption
 532-2   fund;
 532-3               (2)  invested; or
 532-4               (3)  otherwise disposed of.  (V.A.C.S. Art. 1187a, Sec.
 532-5   22.)
 532-6         Sec. 1505.073.  SEPARATE RECORDS.  (a)  A municipality that
 532-7   issues bonds under this subchapter shall establish and maintain
 532-8   proper records into which full and correct entries shall be made of
 532-9   all dealings or transactions of or in relation to the property,
532-10   business, or affairs of the project.
532-11         (b)  The records:
532-12               (1)  must be separate from other records of the
532-13   municipality; and
532-14               (2)  shall be open for examination and inspection by
532-15   any:
532-16                     (A)  taxpayer;
532-17                     (B)  user of a service furnished by the project;
532-18                     (C)  holder of a bond issued under this
532-19   subchapter; or
532-20                     (D)  person acting for or on behalf of the
532-21   taxpayer, user, or holder.  (V.A.C.S. Art. 1187a, Sec. 26.)
532-22         Sec. 1505.074.  REQUIRED PAYMENT FOR SERVICES RENDERED TO
532-23   MUNICIPALITY.  (a)  A municipality shall be charged the reasonable
532-24   cost or value of a service rendered to the municipality by a
532-25   project.
532-26         (b)  The municipality shall pay the charges, as the service
532-27   accrues, from:
 533-1               (1)  current funds of the municipality; or
 533-2               (2)  the proceeds of taxes imposed at a rate sufficient
 533-3   for that purpose.
 533-4         (c)  Money received by the project under this section must be
 533-5   accounted for in the same manner as other revenue of the project.
 533-6   (V.A.C.S. Art. 1187a, Sec. 15.)
 533-7         Sec. 1505.075.  AUTHORITY TO REGULATE OPERATION OF BRIDGES
 533-8   AND TRAFFIC ON BRIDGES.  Except as provided by Section 1505.076, a
 533-9   municipality may adopt reasonable and necessary ordinances to
533-10   regulate:
533-11               (1)  the operation of a bridge that is constructed,
533-12   maintained, or operated under this subchapter; and
533-13               (2)  traffic on the bridge.  (V.A.C.S. Art. 1187a, Sec.
533-14   2.)
533-15         Sec. 1505.076.  COMMISSIONERS OF NAVIGATION DISTRICT.  (a)  A
533-16   municipality may not construct, maintain, or operate a bridge over
533-17   or across an entrance channel to a deepwater port operated by a
533-18   navigation district without a permit issued by the commissioners of
533-19   the district.  Plans and specifications for the bridge must be
533-20   jointly approved by the commissioners and the governing body of the
533-21   municipality.
533-22         (b)  If a bridge over or across the entrance channel to the
533-23   port is constructed, maintained, or operated under this subchapter,
533-24   the commissioners of the navigation district:
533-25               (1)  may prescribe reasonable rules for the operation
533-26   of the bridge in aid of navigation;
533-27               (2)  shall exercise direct control over the maintenance
 534-1   and operation of the mechanical facilities of the bridge that
 534-2   provide clearance of the channel for vessels to enter or leave the
 534-3   port;
 534-4               (3)  may employ and direct all agencies in the
 534-5   management and operation of those facilities; and
 534-6               (4)  may appropriate and use any available revenue of
 534-7   the district to defray the cost of maintaining or operating the
 534-8   bridge.
 534-9         (c)  A municipality may not construct, maintain, or operate a
534-10   bridge over or across an entrance channel to a deepwater port
534-11   operated by a navigation district except as provided by this
534-12   section.
534-13         (d)  This section does not apply after land or a facility
534-14   mortgaged by a municipality is sold on foreclosure.  (V.A.C.S.
534-15   Art. 1187a, Secs. 8 (part), 29.)
534-16         Sec. 1505.077.  AUTHORITY FOR COUNTY APPROPRIATIONS.  A
534-17   county in which is located a municipality to which this chapter
534-18   applies may:
534-19               (1)  appropriate any available revenue of the county to
534-20   the municipality for use in:
534-21                     (A)  constructing a bridge;
534-22                     (B)  reclaiming or reconstructing submerged land;
534-23   or
534-24                     (C)  constructing seawall or breakwater
534-25   protection for its waterfront; or
534-26               (2)  appropriate and apply any available revenue to the
534-27   operation or maintenance of any such project.  (V.A.C.S.
 535-1   Art. 1187a, Sec. 30.)
 535-2         Sec. 1505.078.  AUTHORITY FOR TEXAS DEPARTMENT OF
 535-3   TRANSPORTATION EXPENDITURES.  The Texas Department of
 535-4   Transportation, with the approval of the governor, may apply any of
 535-5   the available revenue of the department to aid in:
 535-6               (1)  the construction, operation, or maintenance of a
 535-7   bridge acquired or constructed under this subchapter, including any
 535-8   approach to the bridge; or
 535-9               (2)  the acquisition of any property in connection with
535-10   or in furtherance of those activities.  (V.A.C.S. Art. 1187a,  Sec.
535-11   31.)
535-12         Sec. 1505.079.  CERTAIN COUNTY AND MUNICIPAL EXPENDITURES NOT
535-13   PROHIBITED.  This subchapter does not prohibit a county or
535-14   municipality from appropriating or using any available income and
535-15   revenue of the county or municipality derived from any source,
535-16   other than from the operation of the project by a municipality, to:
535-17               (1)  pay an immediate expense of maintaining or
535-18   operating a project; or
535-19               (2)  aid in financing any part of constructing a bridge
535-20   or reclaiming any submerged land.  (V.A.C.S. Art. 1187a, Sec. 24.)
535-21         Sec. 1505.080.  UNEXPENDED BALANCE.  (a)  Any proceeds of the
535-22   sale of bonds issued under this subchapter that are unspent after
535-23   completion of the project for which the bonds were issued:
535-24               (1)  shall be deposited to the credit of the bond and
535-25   interest redemption fund for the bonds; and
535-26               (2)  may be used only to:
535-27                     (A)  pay the principal of the bonds; or
 536-1                     (B)  purchase outstanding bonds of the issue from
 536-2   which the proceeds were derived.
 536-3         (b)  A bond may not be purchased under Subsection (a)(2)(B)
 536-4   for a price that exceeds, excluding accrued interest, the face
 536-5   amount of the bond.
 536-6         (c)  A bond purchased under Subsection (a)(2)(B) must be
 536-7   canceled and may not be reissued.  (V.A.C.S. Art. 1187a, Sec. 13
 536-8   (part).)
 536-9         Sec. 1505.081.  EXEMPTION FROM TAXATION.  (a)  A bond or
536-10   interest coupon issued under this subchapter is exempt from
536-11   taxation under any law of this state.
536-12         (b)  In addition to the provisions required by Section
536-13   1505.059(b), each bond issued under this subchapter must state on
536-14   its face the following provision:  "The principal of and interest
536-15   on this bond are exempt from taxation under any law of the State of
536-16   Texas."  (V.A.C.S. Art. 1187a, Sec. 10.)
536-17           (Sections 1505.082-1505.100 reserved for expansion)
536-18    SUBCHAPTER C.  OBLIGATIONS FOR TOLL BRIDGES AND OTHER FACILITIES
536-19                    IN CERTAIN COASTAL MUNICIPALITIES
536-20         Sec. 1505.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
536-21   applies only to a municipality that:
536-22               (1)  is located in a navigation district organized
536-23   under the general laws of this state; and
536-24               (2)  has a deepwater port located in the district.
536-25   (V.A.C.S. Art. 1187b, Sec. 1 (part).)
536-26         Sec. 1505.102.  DEFINITIONS.  In this subchapter:
536-27               (1)  "Bridge or tunnel" means a bridge over, or a tube,
 537-1   underpass, or tunnel under, any stream, inlet, or arm of the Gulf
 537-2   of Mexico or entrance channel to the deepwater port of a
 537-3   municipality that connects any public streets or thoroughfares of,
 537-4   in, or to the municipality.
 537-5               (2)  "Obligation" means a bond, note, or warrant.
 537-6               (3)  "Project" means:
 537-7                     (A)  a facility constructed, maintained,
 537-8   operated, extended, improved, or replaced by a municipality as
 537-9   described by Section 1505.103; and
537-10                     (B)  land acquired or improved by a municipality
537-11   as described by Section 1505.103.  (V.A.C.S.  Art. 1187b, Sec. 16a;
537-12   New.)
537-13         Sec. 1505.103.  AUTHORITY TO ISSUE OBLIGATIONS FOR CERTAIN
537-14   FACILITIES.  A municipality may issue revenue obligations to:
537-15               (1)  construct, maintain, or operate a toll bridge or
537-16   tunnel;
537-17               (2)  construct, maintain, operate, or extend a sewage
537-18   disposal plant, without regard to whether the plant is inside or
537-19   outside the municipality;
537-20               (3)  construct, maintain, extend, or improve a sanitary
537-21   sewer line or storm sewer line, without regard to whether the line
537-22   is inside or outside the municipality;
537-23               (4)  if found necessary by the governing body of the
537-24   municipality, construct, maintain, extend, or improve a water main
537-25   or water line from the source of water supply of the municipality
537-26   to any location inside the municipality;
537-27               (5)  acquire, reclaim, reconstruct, elevate, or fill in
 538-1   any submerged land or lowland along a waterfront of the
 538-2   municipality and construct a sidewalk, street, or gas line on the
 538-3   land;
 538-4               (6)  construct, maintain, extend, or improve a seawall,
 538-5   breakwater, or other shore protection to protect the waterfront of
 538-6   the municipality;
 538-7               (7)  construct, reconstruct, maintain, operate, or
 538-8   dredge a channel or boat basin in connection with any deepwater
 538-9   port of the municipality; or
538-10               (8)  construct, maintain, replace, or operate:
538-11                     (A)  a boat basin or boat slip; or
538-12                     (B)  a structure in connection with the basin or
538-13   slip, including a dry dock, boat service station, wall, pier, or
538-14   wharf.  (V.A.C.S. Art. 1187b, Sec. 1 (part).)
538-15         Sec. 1505.104.  AUTHORITY TO BORROW MONEY.  (a)  In the
538-16   amount and under the terms that are agreed to by the municipality
538-17   and the lender, a municipality may borrow money for a project from:
538-18               (1)  the United States;
538-19               (2)  an agency of the United States authorized to make
538-20   a loan to a municipality; or
538-21               (3)  any person, firm, or corporation.
538-22         (b)  The loan shall be evidenced by obligations issued under
538-23   this subchapter if the project is financed under this subchapter.
538-24   (V.A.C.S. Art. 1187b, Sec. 7.)
538-25         Sec. 1505.105.  SECURITY FOR PAYMENT OF OBLIGATIONS.  (a)  An
538-26   obligation issued under this subchapter, and interest on the
538-27   obligation, must be paid by an appropriation or pledge of all
 539-1   revenue derived from:
 539-2               (1)  one or more projects;
 539-3               (2)  any tolls authorized under Section 1505.113 and
 539-4   collected from the operation of an existing bridge or tunnel; or
 539-5               (3)  both the project and the tolls.
 539-6         (b)  Payment of the obligation may additionally be secured by
 539-7   a mortgage on any project, including a toll bridge or tunnel or
 539-8   reclaimed land.
 539-9         (c)  Any revenue or income derived from one project may be
539-10   pledged to the payment of an obligation issued to provide for a
539-11   different project.  (V.A.C.S. Art. 1187b, Sec. 3 (part).)
539-12         Sec. 1505.106.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
539-13   obligation issued under this subchapter:
539-14               (1)  is not a debt of the municipality;
539-15               (2)  may be a charge only against the revenue,
539-16   property, or improvement pledged for the payment of the obligation;
539-17   and
539-18               (3)  may not be included in determining the power of
539-19   the municipality to issue bonds or lend its credit for any purpose
539-20   authorized by law.
539-21         (b)  Each obligation issued under this subchapter must
539-22   contain the following provision:  "The holder of this obligation is
539-23   not entitled to demand payment of this obligation from any money
539-24   raised by taxation."  (V.A.C.S. Art. 1187b, Secs. 2, 6 (part).)
539-25         Sec. 1505.107.  ELECTION.  (a)  A municipality may not issue
539-26   an obligation under this subchapter unless the issuance is
539-27   authorized by a majority vote of the qualified voters voting at an
 540-1   election held for that purpose under Chapter 1251.
 540-2         (b)  On approval by the voters, the municipality shall issue
 540-3   the approved obligations as soon as practicable.  (V.A.C.S.
 540-4   Art. 1187b, Sec.  4.)
 540-5         Sec. 1505.108.  MATURITY.  An obligation issued under this
 540-6   subchapter must mature not later than 30 years after its date.
 540-7   (V.A.C.S. Art. 1187b, Sec. 5 (part).)
 540-8         Sec. 1505.109.  ACCOUNTS REQUIRED TO BE CREATED BY ORDINANCE.
 540-9   An ordinance authorizing the issuance of obligations under this
540-10   subchapter must provide for:
540-11               (1)  an operation and maintenance account; and
540-12               (2)  an interest and sinking fund account.  (V.A.C.S.
540-13   Art. 1187b, Sec. 13 (part).)
540-14         Sec. 1505.110.  OPERATING EXPENSES AS FIRST LIEN.  (a)  The
540-15   reasonable costs of administering and operating and the reasonable
540-16   expense of maintaining the project are a first lien against the
540-17   revenue and income from the operation of the project, superior to
540-18   the lien of any indenture or deed of trust on the project.
540-19         (b)  From the revenue and income of the project, the
540-20   municipality shall, monthly or more frequently if necessary:
540-21               (1)  first deposit to the credit of the operation and
540-22   maintenance account an amount sufficient to pay the costs and
540-23   expense described in Subsection (a); and
540-24               (2)  deposit to the credit of the interest and sinking
540-25   fund account an amount sufficient to pay when due the principal of
540-26   and interest on the obligation.
540-27         (c)  Revenue or income from a project may not be used except
 541-1   as provided by this section while an obligation related to the
 541-2   project remains outstanding.  (V.A.C.S. Art. 1187b, Secs. 12, 13
 541-3   (part), 14 (part).)
 541-4         Sec. 1505.111.  EXECUTION OF INDENTURE OR DEED OF TRUST.
 541-5   (a)  Before an obligation issued under this subchapter is offered
 541-6   for sale, the mayor and the municipal treasurer or finance
 541-7   commissioner, if authorized by an ordinance adopted by the
 541-8   governing body of the municipality, may execute an indenture or
 541-9   deed of trust that:
541-10               (1)  makes effective the mortgage lien on any property
541-11   pledged to secure payment of the principal of and interest on the
541-12   obligation; and
541-13               (2)  names a bank or banking institution with trust
541-14   powers.
541-15         (b)  The indenture or deed of trust may provide for a grant
541-16   to a purchaser, under sale or foreclosure, of a franchise to
541-17   operate the encumbered property for a term not to exceed 20 years
541-18   from the date of purchase, subject to Subsection (c) and to all
541-19   laws regulating the same then in force.
541-20         (c)  The municipality may, at any five-year period within the
541-21   20-year term, repurchase the property designated in the franchise
541-22   under reasonable terms and at a reasonable price, as stated in the
541-23   encumbrance.  This subsection does not apply to any land or
541-24   property in a reclaimed area that is acquired from the municipality
541-25   by an individual purchaser.
541-26         (d)  The indenture or deed of trust shall be recorded in the
541-27   deed of trust and mortgage records of each county in which any of
 542-1   the indentured property is located.  (V.A.C.S. Art. 1187b, Sec.
 542-2   11.)
 542-3         Sec. 1505.112.  AUTHORITY TO REMOVE OR DEMOLISH BRIDGE OR
 542-4   TUNNEL.  The governing body of a municipality may remove or
 542-5   demolish any structure owned and operated by the municipality,
 542-6   including a bridge or tunnel, if the removal or demolition is
 542-7   necessary to complete a project.  (V.A.C.S. Art. 1187b, Sec. 8.)
 542-8         Sec. 1505.113.  CONVERSION OF BRIDGE OR TUNNEL TO TOLL BRIDGE
 542-9   OR TUNNEL.  (a)  The governing body of a municipality by ordinance
542-10   may convert a bridge or tunnel to a toll bridge or tunnel if:
542-11               (1)  the bridge or tunnel is owned or operated by the
542-12   municipality; and
542-13               (2)  the governing body finds that it is not necessary
542-14   or practicable to construct a toll bridge or tunnel under this
542-15   subchapter.
542-16         (b)  The governing body, if authorized at the election
542-17   ordered by the governing body on the issuance of the obligations:
542-18               (1)  may set and collect tolls for the use of the toll
542-19   bridge or tunnel in amounts determined by the governing body to be
542-20   reasonable and sufficient, when combined with other revenue and
542-21   income from a project, to pay the principal of and interest on
542-22   obligations issued under this subchapter as they mature; and
542-23               (2)  shall deposit money received under Subdivision (1)
542-24   to the credit of the interest and sinking fund account and shall
542-25   use the money only to pay the principal of and interest on the
542-26   obligations.  (V.A.C.S. Art. 1187b, Sec. 10.)
542-27         Sec. 1505.114.  EMINENT DOMAIN.  (a)  A municipality may
 543-1   exercise the power of eminent domain to acquire the fee simple
 543-2   title to, an easement in, or a right-of-way over or through any
 543-3   property, including water or land under water, that the governing
 543-4   body of the municipality determines necessary to accomplish a
 543-5   purpose provided by Section 1505.103 without regard to whether the
 543-6   property is inside or outside the municipality.
 543-7         (b)  A municipality may not condemn property under Subsection
 543-8   (a) if the property is used for cemetery purposes.
 543-9         (c)  A municipality shall pay adequate compensation to the
543-10   owner of property that is taken, damaged, or destroyed in the
543-11   accomplishment of a purpose provided by Section 1505.103.
543-12         (d)  A municipality shall pay compensation and damages
543-13   adjudicated in a condemnation proceeding or damage to the property
543-14   of a person or corporation in the accomplishment of a purpose
543-15   provided by Section 1505.103 from the proceeds of obligations
543-16   issued under this subchapter.
543-17         (e)  Chapter 21, Property Code, governs the procedure for the
543-18   exercise of the power of eminent domain under this section.
543-19   (V.A.C.S. Art. 1187b, Sec. 9.)
543-20         Sec. 1505.115.  COMMISSIONERS OF NAVIGATION DISTRICT.  (a)  A
543-21   municipality may not construct, maintain, or operate a toll bridge
543-22   or tunnel over, across, or under an entrance channel to a deepwater
543-23   port operated by a navigation district without a permit issued by
543-24   the commissioners of the district.  Plans and specifications for
543-25   the bridge or tunnel must be jointly approved by the commissioners
543-26   and the governing body of the municipality.
543-27         (b)  If a toll bridge or tunnel over, across, or under the
 544-1   entrance channel to the port is constructed, maintained, or
 544-2   operated under this subchapter, the commissioners of the navigation
 544-3   district:
 544-4               (1)  may prescribe reasonable rules for the operation
 544-5   of the bridge or tunnel in aid of navigation;
 544-6               (2)  shall exercise direct control over the maintenance
 544-7   and operation of the mechanical facilities of the bridge or tunnel
 544-8   that provide clearance of the channel for vessels to enter or leave
 544-9   the port; and
544-10               (3)  may employ and direct all agencies in the
544-11   management and operation of those facilities.
544-12         (c)  The municipality shall bear the cost of maintaining and
544-13   operating the facilities described by Subsection (b)(2).
544-14         (d)  A municipality may not construct, maintain, or operate a
544-15   toll bridge over or across, or a tunnel under, an entrance channel
544-16   to a deepwater port operated by a navigation district except as
544-17   provided by this section.  (V.A.C.S. Art. 1187b, Sec. 15.)
544-18           (Sections 1505.116-1505.150 reserved for expansion)
544-19         SUBCHAPTER D.  OBLIGATIONS FOR FISH MARKETS BY CERTAIN
544-20                         COASTAL MUNICIPALITIES
544-21         Sec. 1505.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
544-22   applies only to a municipality:
544-23               (1)  that has a population of more than 1,000;
544-24               (2)  that is located within five miles of the coast or
544-25   of any gulf, bay, or inlet of the coast; and
544-26               (3)  in which commercial fishing and shrimping is an
544-27   established industry.  (V.A.C.S. Art. 1187c, Sec. 1 (part).)
 545-1         Sec. 1505.152.  AUTHORITY TO ACQUIRE OR CONSTRUCT FISH
 545-2   MARKET.  (a)  A municipality may:
 545-3               (1)  acquire or construct a municipal fish market to
 545-4   encourage, develop, and standardize the fishing and shrimping
 545-5   industry; and
 545-6               (2)  acquire any real property necessary for the site
 545-7   of the fish market.
 545-8         (b)  The fish market must provide sanitary facilities and
 545-9   equipment for cleaning, packing, shucking, canning, and cold
545-10   storage of shrimp, oysters, and other seafood.  (V.A.C.S.
545-11   Art. 1187c, Sec. 1 (part).)
545-12         Sec. 1505.153.  AUTHORITY TO ISSUE OBLIGATIONS.  A
545-13   municipality may issue bonds or revenue notes to acquire or
545-14   construct a municipal fish market.  (V.A.C.S. Art. 1187c, Sec. 1
545-15   (part).)
545-16         Sec. 1505.154.  AUTHORITY TO ACCEPT LOANS AND GRANTS FROM
545-17   UNITED STATES.  (a)  A municipality may accept a loan or a grant
545-18   from the United States to acquire or construct a municipal fish
545-19   market, including the necessary real property on which it is
545-20   located, only if the acquisition or construction of the market is
545-21   approved:
545-22               (1)  by the Texas Department of Health on a
545-23   determination that the market is conducive to the health of the
545-24   people of this state who consume food products from the coastal
545-25   waters of this state; and
545-26               (2)  by the Parks and Wildlife Department on a
545-27   determination that:
 546-1                     (A)  the market is feasible and of economic
 546-2   importance to the fishing industry generally in the entire district
 546-3   to be served by the market, as distinguished from the local or
 546-4   civic benefits to be derived from the market by the municipality;
 546-5   and
 546-6                     (B)  the economic need for the market is not
 546-7   adequately met by a similar existing facility accessible to the
 546-8   district to be served.
 546-9         (b)  Any such market is subject to all applicable health and
546-10   sanitation rules adopted by the Texas Department of Health.
546-11   (V.A.C.S. Art. 1187c, Secs. 1 (part), 2.)
546-12         Sec. 1505.155.  SECURITY FOR PAYMENT OF OBLIGATIONS.  (a)  A
546-13   municipality may secure the payment of an obligation issued under
546-14   this subchapter by:
546-15               (1)  mortgaging the physical property acquired or
546-16   constructed or to be acquired or constructed and pledging the net
546-17   revenue derived from the property; or
546-18               (2)  pledging the net revenue derived from the property
546-19   without a mortgage on the property.
546-20         (b)  A municipality that mortgages the property may provide
546-21   in the encumbrance for a grant, to a purchaser under sale or
546-22   foreclosure, of a permit to operate the fish market, subject to all
546-23   laws then in force regulating the operation of such an industry.
546-24   (V.A.C.S. Art. 1187c, Sec. 1 (part).)
546-25         Sec. 1505.156.  OBLIGATIONS NOT PAYABLE FROM TAXES.  (a)  An
546-26   obligation issued under this subchapter:
546-27               (1)  is not a debt of the municipality;
 547-1               (2)  may be a charge only against the revenue or
 547-2   property pledged for the payment of the obligation; and
 547-3               (3)  may not be included in determining the power of
 547-4   the municipality to issue bonds for any purpose authorized by law.
 547-5         (b)  Each obligation issued under this subchapter must
 547-6   contain the following provision:  "The holder of this obligation is
 547-7   not entitled to demand payment of this obligation from any money
 547-8   raised by taxation."  (V.A.C.S. Art. 1187c, Secs. 1 (part), 6.)
 547-9         Sec. 1505.157.  MATURITY.  An obligation issued under this
547-10   subchapter must mature not later than 40 years after its date.
547-11   (V.A.C.S. Art. 1187c, Sec. 1 (part).)
547-12         Sec. 1505.158.  OPERATING EXPENSES AS FIRST LIEN.  The
547-13   expenses of operating and maintaining a fish market acquired or
547-14   constructed under this subchapter, including all salaries, labor,
547-15   materials, and repairs necessary to permit the market to provide
547-16   efficient service, are a first lien on the revenue from the
547-17   operation of the market.  (V.A.C.S. Art. 1187c, Sec. 4 (part).)
547-18         Sec. 1505.159.  USE OF REVENUE.  Except as provided by
547-19   Section 1505.160, a municipality may only use the gross revenue of
547-20   a fish market acquired or constructed under this subchapter:
547-21               (1)  to pay the expenses of operating and maintaining
547-22   the market;
547-23               (2)  after payment of operating and maintenance
547-24   expenses, to pay the principal of and interest on any obligation
547-25   issued to acquire or construct the market; and
547-26               (3)  after payment of operating and maintenance
547-27   expenses and debt service, to:
 548-1                     (A)  redeem any obligation issued to acquire or
 548-2   construct the market before maturity; or
 548-3                     (B)  invest in any security specified in a
 548-4   contract under which money for the acquisition or construction of
 548-5   the market is provided to the municipality.  (V.A.C.S. Art. 1187c,
 548-6   Sec. 4 (part).)
 548-7         Sec. 1505.160.  SUBORDINATE OBLIGATIONS.  (a)  If the
 548-8   governing body of a municipality considers it necessary to extend
 548-9   or enlarge the fish market, the governing body may:
548-10               (1)  issue subordinate bonds or notes; and
548-11               (2)  pledge the revenue of the fish market to the
548-12   payment of those bonds or notes.
548-13         (b)  A pledge of the revenue for subordinate bonds or notes
548-14   is inferior to any prior pledge.
548-15         (c)  The municipality shall establish, deposit, and secure
548-16   the funds to facilitate the payment of the principal of and
548-17   interest on the bonds or notes.  (V.A.C.S. Art. 1187c, Sec. 4
548-18   (part).)
548-19         Sec. 1505.161.  LEASE AND SALE OF FACILITIES.  Subject to any
548-20   prior covenant or agreement relating to an outstanding revenue bond
548-21   issued to acquire or construct a fish market under this subchapter,
548-22   the governing body of a municipality may:
548-23               (1)  lease all or part of the facilities of the market
548-24   and property associated with the market for a period not longer
548-25   than 20 years to any person, firm, or corporation; and
548-26               (2)  sell all or part of the facilities of the market
548-27   and property associated with the market to any person, firm, or
 549-1   corporation.  (V.A.C.S. Art. 1187c, Sec. 7 (part).)
 549-2           (Sections 1505.162-1505.200 reserved for expansion)
 549-3       SUBCHAPTER E.  BONDS FOR HARBOR IMPROVEMENTS AND FACILITIES
 549-4      IN COASTAL MUNICIPALITIES WITH POPULATION OF LESS THAN 12,000
 549-5         Sec. 1505.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 549-6   applies only to a municipality that:
 549-7               (1)  has a population of less than 12,000; and
 549-8               (2)  is located on the Gulf of Mexico or a channel,
 549-9   canal, bay, or inlet connected with that gulf.  (V.A.C.S.
549-10   Art. 1187e, Secs. 1(a) (part), 6(b) (part).)
549-11         Sec. 1505.202.  DEFINITIONS.  In this subchapter:
549-12               (1)  "Bond authorization" means an ordinance or
549-13   resolution authorizing the issuance of bonds.
549-14               (2)  "Harbor improvement or facility" means a harbor,
549-15   port, or navigational facility described by Section 1505.203.
549-16   (New.)
549-17         Sec. 1505.203.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  A
549-18   municipality may issue revenue bonds to construct, acquire, lease,
549-19   improve, enlarge, extend, repair, maintain, replace, develop,
549-20   operate, regulate, or encumber a harbor or port of the municipality
549-21   or a navigational facility that pertains or is an aid to the harbor
549-22   or port, including:
549-23               (1)  land or fill;
549-24               (2)  a boathouse or boat piling;
549-25               (3)  a seawall, breakwater, or shore protection;
549-26               (4)  a wharf, dock, or pier;
549-27               (5)  a walk or way;
 550-1               (6)  a wall or bulkhead;
 550-2               (7)  a canal, channel, slip, pool, waterway, or turning
 550-3   basin;
 550-4               (8)  a dry dock, service facility, floating plant,
 550-5   loading device, lightering facility, bunkering facility, or towing
 550-6   facility;
 550-7               (9)  a bridge, tube, underpass, tunnel, or ferry;
 550-8               (10)  equipment;
 550-9               (11)  a pavilion, building, warehouse, or structure;
550-10               (12)  an aid to navigation; and
550-11               (13)  any other facility, improvement, or aid incident
550-12   to or necessary or desirable in connection with the harbor or port.
550-13         (b)  This subchapter does not authorize a  municipality to
550-14   issue bonds that are payable from taxes.  (V.A.C.S. Art. 1187e,
550-15   Secs. 1(a) (part), (b) (part), 6(a).)
550-16         Sec. 1505.204.  AUTHORITY TO ACCEPT LOANS AND GRANTS.  For a
550-17   purpose described by Section 1505.203, a municipality may accept a
550-18   loan or grant from any source, including:
550-19               (1)  the United States, a state, or a county; and
550-20               (2)  an agency of a state or county.  (V.A.C.S.
550-21   Art. 1187e, Sec. 1(a) (part).)
550-22         Sec. 1505.205.  LOCATION OF HARBOR IMPROVEMENT OR FACILITY.
550-23   A harbor improvement or facility financed by bonds or a loan or
550-24   grant authorized under this subchapter must be located inside
550-25   municipal boundaries.  (V.A.C.S.  Art. 1187e, Sec. 6(c).)
550-26         Sec. 1505.206.  PLEDGE OF REVENUE.  (a)  In this section,
550-27   "net revenue" means the gross revenue derived from a harbor
 551-1   improvement or facility less the amount necessary to pay the cost
 551-2   of maintaining and operating the harbor improvement or facility.
 551-3         (b)  A bond issued under this subchapter is payable from
 551-4   revenue pledged by the governing body of the municipality to the
 551-5   payment of the bond.
 551-6         (c)  To secure payment of principal of and interest on bonds
 551-7   issued under this subchapter, the governing body of the
 551-8   municipality may pledge:
 551-9               (1)  the gross or net revenue of:
551-10                     (A)  a harbor improvement or facility to be
551-11   financed by the bonds; or
551-12                     (B)  a harbor improvement or facility in
551-13   existence before the issuance of the bonds, if that revenue may be
551-14   pledged;
551-15               (2)  unless the bond authorization specifies a
551-16   different amount, the entire amount of revenue due the municipality
551-17   under a contract in existence before the issuance of the bonds or
551-18   to be entered into after the issuance, if that revenue may be
551-19   pledged; or
551-20               (3)  any other revenue specified by the bond
551-21   authorization that may be pledged.  (V.A.C.S. Art. 1187e, Secs.
551-22   1(b) (part), 2(b) (part).)
551-23         Sec. 1505.207.  GRANT OF FRANCHISE.  As additional security
551-24   for the encumbrance, a municipality that encumbers a harbor
551-25   improvement or facility under Section 1505.203 may provide in the
551-26   encumbrance for a grant, to a purchaser under sale or foreclosure,
551-27   of a franchise to operate the harbor improvement or facility,
 552-1   including any improvement, for a term not to exceed 30 years from
 552-2   the date of purchase, subject to all laws regulating the same then
 552-3   in force.  (V.A.C.S.  Art. 1187e, Sec. 1(a) (part).)
 552-4         Sec. 1505.208.  BONDS NOT PAYABLE FROM TAXES.  (a)  A bond
 552-5   issued under this subchapter:
 552-6               (1)  is not a debt of the municipality; and
 552-7               (2)  may be a charge only against the property,
 552-8   facilities, and contracts authorized by the bond authorization.
 552-9         (b)  Each bond issued under this subchapter must state on its
552-10   face the following provision:  "The holder of this obligation is
552-11   not entitled to demand payment of this obligation from any money
552-12   raised by taxation."  (V.A.C.S. Art. 1187e, Sec. 2(c) (part).)
552-13         Sec. 1505.209.  ELECTION.  (a)  A municipality may not issue
552-14   bonds under this subchapter unless the issuance is authorized by a
552-15   majority of the qualified voters voting at an election held for
552-16   that purpose under Chapter 1251.
552-17         (b)  The municipality shall hold the election in the manner
552-18   provided for the issuance of other bonds of the municipality.
552-19         (c)  This section does not apply to refunding bonds.
552-20   (V.A.C.S. Art. 1187e, Secs. 1(b) (part), (c) (part), 3.)
552-21         Sec. 1505.210.  ADDITIONAL BONDS.  The bond authorization may
552-22   reserve the right to issue additional bonds on a parity with, or
552-23   subordinate to, the bond being issued, subject to the conditions
552-24   prescribed by the bond authorization.  (V.A.C.S. Art. 1187e, Sec.
552-25   2(b) (part).)
552-26         Sec. 1505.211.  TRANSFER OF PLEDGED REVENUE.  (a)  A
552-27   municipality may, in the bond authorization, transfer pledged
 553-1   revenue from the harbor improvement or facility to the general fund
 553-2   of the municipality.
 553-3         (b)  The transferred revenue:
 553-4               (1)  must be in the amount authorized in the bond
 553-5   authorization; and
 553-6               (2)  to the extent authorized in the bond
 553-7   authorization, may be used for general or special purposes.
 553-8   (V.A.C.S. Art. 1187e, Sec. 2(b) (part).)
 553-9         Sec. 1505.212.  RATES.  The governing body of the
553-10   municipality shall set the rates for municipal charges, rents, and
553-11   leases and for services rendered by the municipality in connection
553-12   with a harbor improvement or facility, the revenue of which is
553-13   pledged, in an amount sufficient to:
553-14               (1)  pay the expense of operating and maintaining the
553-15   improvement or facility;
553-16               (2)  pay the interest on the bond as it accrues;
553-17               (3)  pay the principal of the bond as it matures; and
553-18               (4)  maintain the reserve and other funds as provided
553-19   in the bond authorization, unless otherwise specifically provided
553-20   for in the bond authorization.  (V.A.C.S.  Art. 1187e, Sec. 2(c)
553-21   (part).)
553-22         Sec. 1505.213.  APPOINTMENT OF RECEIVER.  (a)  On default or
553-23   threatened default in the payment of principal of or interest on an
553-24   issue of bonds under this subchapter, a court may, on petition of
553-25   the holders of 25 percent of the outstanding bonds, appoint a
553-26   receiver with authority to:
553-27               (1)  collect and receive the income from a harbor
 554-1   improvement or facility or a contract the revenue of which is
 554-2   pledged;
 554-3               (2)  employ an agent or employee;
 554-4               (3)  take charge of money on hand; and
 554-5               (4)  manage without consent or hindrance by the
 554-6   governing body of the municipality the proprietary affairs of the
 554-7   harbor improvement or facility or the contract the revenue of which
 554-8   is pledged.
 554-9         (b)  The court may also:
554-10               (1)  authorize the receiver to lease the harbor
554-11   improvement or facility the revenue of which is pledged and renew
554-12   the contract with the approval of the court; and
554-13               (2)  vest the receiver with any other power or duty the
554-14   court finds necessary for the protection of the bondholders.
554-15   (V.A.C.S. Art. 1187e, Sec. 2(f).)
554-16         Sec. 1505.214.  EXEMPTION FROM ASSESSMENT OR TAXATION.  (a)
554-17   A municipality is not required to pay any assessment on a harbor
554-18   improvement or facility.
554-19         (b)  A bond issued under this subchapter, the transfer of the
554-20   bond, and the income from the bond, including any profit made from
554-21   the sale of the bond, are exempt from taxation by this state or a
554-22   political subdivision of this state.  (V.A.C.S. Art. 1187e, Sec. 7
554-23   (part).)
554-24         Sec. 1505.215.  AUTHORITY TO ISSUE REFUNDING BONDS.  A
554-25   municipality by resolution may issue refunding bonds to refund
554-26   outstanding bonds, and the interest on those bonds, issued by the
554-27   municipality under this subchapter.  (V.A.C.S. Art. 1187e, Sec.
 555-1   1(c) (part).)
 555-2         Sec. 1505.216.  TERMS OF ISSUANCE OF REFUNDING BONDS.
 555-3   (a)  Refunding bonds may:
 555-4               (1)  be issued under this subchapter to refund bonds
 555-5   of:
 555-6                     (A)  a single issue or two or more consecutive
 555-7   issues; or
 555-8                     (B)  a single series or two or more consecutive
 555-9   series;
555-10               (2)  combine the pledges related to bonds to be
555-11   refunded to secure the refunding bonds; or
555-12               (3)  be secured by a pledge of other or additional
555-13   revenue.
555-14         (b)  Refunding bonds issued under this subchapter have the
555-15   same priority of lien on the revenue pledged to their payment as is
555-16   pledged to the bonds to be refunded.
555-17         (c)  If two or more consecutive series or issues of bonds are
555-18   refunded in a single issue of refunding bonds, the lien on all the
555-19   refunding bonds is equal if all bonds of the several series or
555-20   issues of bonds to be refunded are surrendered in exchange for the
555-21   refunding bonds.
555-22         (d)  Refunding bonds issued under this subchapter may not
555-23   have a priority of lien greater than the highest priority of lien
555-24   of a series or issue of bonds to be refunded.  (V.A.C.S.
555-25   Art. 1187e, Sec. 1(c) (part).)
555-26         Sec. 1505.217.  REGISTRATION OF REFUNDING BONDS BY
555-27   COMPTROLLER.  (a)  The comptroller shall register the refunding
 556-1   bonds on the surrender and cancellation of the bonds to be
 556-2   refunded.
 556-3         (b)  In lieu of issuing bonds to be registered on the
 556-4   surrender and cancellation of the bonds to be refunded, the
 556-5   municipality, in the resolution authorizing the issuance of the
 556-6   refunding bonds, may provide for the sale of the refunding bonds
 556-7   and the deposit of the proceeds in the bank where the bonds to be
 556-8   refunded are payable.  In that case, the refunding bonds may be
 556-9   issued in an amount sufficient to pay the interest on the bonds to
556-10   be refunded to their option or maturity date, and the comptroller
556-11   shall register the refunding bonds without the surrender and
556-12   cancellation of the bonds to be refunded.  (V.A.C.S.  Art. 1187e,
556-13   Sec. 1(c) (part).)
556-14           (Sections 1505.218-1505.250 reserved for expansion)
556-15     SUBCHAPTER F.  BONDS FOR HARBOR, WHARF, AND DOCK FACILITIES IN
556-16         COASTAL MUNICIPALITIES WITH POPULATION OF 5,000 OR LESS
556-17         Sec. 1505.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
556-18   applies only to a general-law municipality that:
556-19               (1)  has a population of 5,000 or less; and
556-20               (2)  is located on the Gulf of Mexico or a channel,
556-21   canal, bay, or inlet connected with that gulf.  (V.A.C.S.
556-22   Art. 835l, Sec. 1 (part).)
556-23         Sec. 1505.252.  AUTHORITY FOR HARBOR, WHARF, AND DOCK
556-24   FACILITIES.  A municipality may  purchase, condemn, construct, own,
556-25   maintain, improve, repair, operate, or lease:
556-26               (1)  a wharf, pier, pavilion, dock, harbor, or boat
556-27   basin; and
 557-1               (2)  another facility associated with a facility listed
 557-2   in Subdivision (1) that the municipality considers advisable,
 557-3   including a ferry, marina, elevated platform, parking facility,
 557-4   restaurant, hotel, motel, club, or other commercial establishment
 557-5   or municipal building.  (V.A.C.S. Art. 835l, Sec. 1 (part).)
 557-6         Sec. 1505.253.  AUTHORITY TO ISSUE BONDS.  A municipality
 557-7   may:
 557-8               (1)  issue bonds for a purpose described by Section
 557-9   1505.252 and provide for the payment of the principal of and
557-10   interest on the bonds from the income of the facility, including
557-11   income from leasing the facility, less the reasonable cost of the
557-12   operation and maintenance of the facility; or
557-13               (2)  issue bonds for that purpose in the manner
557-14   provided for the issuance of other municipal bonds payable from an
557-15   ad valorem tax imposed on taxable property in the municipality.
557-16   (V.A.C.S. Art. 835l, Sec. 2.)
557-17         Sec. 1505.254.  ELECTION.  (a)  The governing body of a
557-18   municipality may not issue bonds under this subchapter that are
557-19   payable from ad valorem taxes unless authorized by a majority of
557-20   the qualified voters voting at an election.
557-21         (b)  The governing body of a municipality may issue bonds
557-22   under this subchapter that are payable from the income of a
557-23   facility without notice or an election in connection with the
557-24   issuance of the bonds.  (V.A.C.S. Art. 835l, Sec. 3 (part).)
557-25      CHAPTER 1506.  BONDS FOR MUNICIPAL PARKING AND TRANSPORTATION
557-26                               FACILITIES
557-27         SUBCHAPTER A.  REVENUE BONDS FOR PARKING FACILITIES IN
 558-1      HOME-RULE MUNICIPALITIES WITH POPULATION OF LESS THAN 60,000
 558-2   Sec. 1506.001.  APPLICABILITY OF SUBCHAPTER
 558-3   Sec. 1506.002.  AUTHORITY TO ISSUE REVENUE BONDS
 558-4   Sec. 1506.003.  PLEDGE OF REVENUE
 558-5   Sec. 1506.004.  BONDS NOT PAYABLE FROM TAXES
 558-6   Sec. 1506.005.  ELECTION
 558-7   Sec. 1506.006.  MATURITY
 558-8   Sec. 1506.007.  SIGNATURES
 558-9   Sec. 1506.008.  EXEMPTION FROM TAXATION
558-10   Sec. 1506.009.  PERSONNEL; OPERATION AND MAINTENANCE
558-11                     EXPENSES
558-12   Sec. 1506.010.  FEES FOR SERVICES; RESERVES
558-13   Sec. 1506.011.  ADDITIONAL BONDS
558-14           (Sections 1506.012-1506.050 reserved for expansion)
558-15        SUBCHAPTER B.  BONDS FOR PARKING FACILITIES IN HOME-RULE
558-16                             MUNICIPALITIES
558-17   Sec. 1506.051.  APPLICABILITY OF SUBCHAPTER
558-18   Sec. 1506.052.  AUTHORITY FOR PARKING FACILITIES
558-19   Sec. 1506.053.  AUTHORITY TO ESTABLISH IMPROVEMENT DISTRICTS
558-20                     AND ISSUE BONDS
558-21   Sec. 1506.054.  ELECTION
558-22   Sec. 1506.055.  FORM OF BOND
558-23   Sec. 1506.056.  SALE OF BONDS
558-24   Sec. 1506.057.  INTEREST AND SINKING FUND TAX
558-25   Sec. 1506.058.  PROCEEDS OF TAX
558-26   Sec. 1506.059.  INVESTMENT OF SINKING FUND
558-27   Sec. 1506.060.  EMINENT DOMAIN
 559-1   Sec. 1506.061.  RELOCATION OR ALTERATION EXPENSE
 559-2           (Sections 1506.062-1506.100 reserved for expansion)
 559-3          SUBCHAPTER C.  REVENUE BONDS FOR PARKING IMPROVEMENTS
 559-4                    IN CERTAIN COASTAL MUNICIPALITIES
 559-5   Sec. 1506.101.  APPLICABILITY OF SUBCHAPTER
 559-6   Sec. 1506.102.  DEFINITION
 559-7   Sec. 1506.103.  AUTHORITY FOR PARKING IMPROVEMENTS
 559-8   Sec. 1506.104.  AUTHORITY TO ISSUE REVENUE BONDS
 559-9   Sec. 1506.105.  PLEDGE OF REVENUE
559-10   Sec. 1506.106.  LIEN ON PARKING IMPROVEMENT
559-11   Sec. 1506.107.  BONDS NOT PAYABLE FROM TAXES
559-12   Sec. 1506.108.  CONTENTS OF ORDINANCE AUTHORIZING BONDS
559-13   Sec. 1506.109.  ADOPTION AND EXECUTION OF DOCUMENTS
559-14   Sec. 1506.110.  MATURITY
559-15   Sec. 1506.111.  SIGNATURES
559-16   Sec. 1506.112.  SALE OF BONDS
559-17   Sec. 1506.113.  INVESTMENT OF BOND PROCEEDS AND FUNDS
559-18   Sec. 1506.114.  CHARGES FOR SERVICES
559-19   Sec. 1506.115.  REFUNDING BONDS
559-20   Sec. 1506.116.  CONFLICT WITH MUNICIPAL CHARTER
559-21           (Sections 1506.117-1506.150 reserved for expansion)
559-22       SUBCHAPTER D.  REVENUE BONDS FOR PARKING AND TRANSPORTATION
559-23    FACILITIES IN MUNICIPALITIES WITH POPULATION OF MORE THAN 650,000
559-24   Sec. 1506.151.  APPLICABILITY OF SUBCHAPTER
559-25   Sec. 1506.152.  AUTHORITY FOR PARKING AND TRANSPORTATION
559-26                     FACILITIES
559-27   Sec. 1506.153.  CONTRACTS AND LEASES; JOINT DEVELOPMENT
 560-1   Sec. 1506.154.  AUTHORITY TO ISSUE REVENUE BONDS
 560-2   Sec. 1506.155.  PLEDGE OF REVENUE
 560-3   Sec. 1506.156.  ADDITIONAL SECURITY
 560-4   Sec. 1506.157.  MATURITY
 560-5   Sec. 1506.158.  ADDITIONAL BONDS
 560-6   Sec. 1506.159.  SALE OF BONDS
 560-7   Sec. 1506.160.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
 560-8                     BONDS
 560-9   Sec. 1506.161.  CHARGES
560-10   Sec. 1506.162.  REFUNDING BONDS
560-11   Sec. 1506.163.  PUBLIC PURPOSE
560-12   Sec. 1506.164.  CONFLICT WITH OTHER LAW
560-13      CHAPTER 1506.  BONDS FOR MUNICIPAL PARKING AND TRANSPORTATION
560-14                               FACILITIES
560-15         SUBCHAPTER A.  REVENUE BONDS FOR PARKING FACILITIES IN
560-16      HOME-RULE MUNICIPALITIES WITH POPULATION OF LESS THAN 60,000
560-17         Sec. 1506.001.  APPLICABILITY OF SUBCHAPTER.  This subchapter
560-18   applies only to a home-rule municipality that:
560-19               (1)  has a population of less than 60,000; and
560-20               (2)  on January 1, 1949, owned and operated a public
560-21   parking lot.  (V.A.C.S. Art. 835h, Sec. 1 (part).)
560-22         Sec. 1506.002.  AUTHORITY TO ISSUE REVENUE BONDS.  The
560-23   governing body of a municipality by ordinance may issue revenue
560-24   bonds to construct a building or other permanent improvement on a
560-25   parking lot owned and operated by the municipality on January 1,
560-26   1949, for public parking or storage of motor vehicles.  (V.A.C.S.
560-27   Art. 835h, Sec. 1 (part).)
 561-1         Sec. 1506.003.  PLEDGE OF REVENUE.  (a)  In this section,
 561-2   "net revenue" means gross revenue minus all operation and
 561-3   maintenance expenses.
 561-4         (b)  Bonds issued under this subchapter may be secured only
 561-5   by a pledge of and be payable from the net revenue from the
 561-6   building or other improvement for which the bonds are issued and
 561-7   the parking lot on which the building or improvement is located.
 561-8   (V.A.C.S. Art. 835h, Sec. 1 (part).)
 561-9         Sec. 1506.004.  BONDS NOT PAYABLE FROM TAXES.  (a)  A bond
561-10   issued under this subchapter:
561-11               (1)  is not a debt of the municipality;
561-12               (2)  may be a charge only on the revenue pledged for
561-13   the payment of the bond; and
561-14               (3)  may not be included in determining the power of
561-15   the municipality to issue bonds payable from taxation.
561-16         (b)  A bond issued under this subchapter must contain on its
561-17   face the following provision:  "The holder of this obligation is
561-18   not entitled to demand payment of this obligation out of any money
561-19   raised by taxation."  (V.A.C.S. Art. 835h, Sec. 1 (part).)
561-20         Sec. 1506.005.  ELECTION.  A municipality may issue bonds
561-21   under this subchapter without an election, but the governing body
561-22   of the municipality may hold an election in compliance with Chapter
561-23   1251 to determine whether a majority of the qualified voters of the
561-24   municipality voting in the election approve the issuance of the
561-25   bonds.  (V.A.C.S. Art. 835h, Sec. 2 (part).)
561-26         Sec. 1506.006.  MATURITY.  A bond issued under this
561-27   subchapter must:
 562-1               (1)  be payable serially; and
 562-2               (2)  mature not later than 40 years after its date.
 562-3   (V.A.C.S. Art. 835h, Sec. 2 (part).)
 562-4         Sec. 1506.007.  SIGNATURES.  A bond issued under this
 562-5   subchapter must be signed by the mayor of the municipality and
 562-6   countersigned by the secretary of the municipality.  (V.A.C.S.
 562-7   Art. 835h, Sec.  2 (part).)
 562-8         Sec. 1506.008.  EXEMPTION FROM TAXATION.  A bond issued under
 562-9   this subchapter is exempt from taxation by this state or by a
562-10   municipal corporation or any other political subdivision of this
562-11   state.  (V.A.C.S. Art. 835h, Sec. 5.)
562-12         Sec. 1506.009.  PERSONNEL; OPERATION AND MAINTENANCE
562-13   EXPENSES.  A municipality may employ personnel necessary to operate
562-14   a building or other improvement financed under this subchapter.
562-15   The costs of operation and maintenance of the building or other
562-16   improvement and the parking lot on which the building or other
562-17   improvement is located are a first lien against the income from the
562-18   operation of the facility.  (V.A.C.S. Art. 835h, Sec. 3 (part).)
562-19         Sec. 1506.010.  FEES FOR SERVICES; RESERVES.  (a)  A
562-20   municipality may establish and enforce fees for the use of a
562-21   building or other improvement financed under this subchapter and
562-22   the parking lot on which the building or other improvement is
562-23   located.
562-24         (b)  While the principal of or interest on a bond issued
562-25   under this subchapter is outstanding, the municipality shall charge
562-26   the fees in amounts at least sufficient to:
562-27               (1)  pay all operating and maintenance expenses in
 563-1   connection with the building or other improvement and the parking
 563-2   lot;
 563-3               (2)  pay the principal of and interest on the
 563-4   outstanding bonds as the principal matures and as the interest
 563-5   accrues; and
 563-6               (3)  establish and maintain any reserves prescribed in
 563-7   the ordinance authorizing the issuance of the bonds.
 563-8         (c)  Fees charged under this section must be equal and
 563-9   uniform within classes defined by the governing body of the
563-10   municipality.  (V.A.C.S. Art. 835h, Sec. 3 (part).)
563-11         Sec. 1506.011.  ADDITIONAL BONDS.  While any bonds issued
563-12   under this subchapter are outstanding, the municipality may not
563-13   issue additional bonds of equal dignity against the pledged
563-14   revenue, except to the extent and in the manner expressly permitted
563-15   in the ordinance authorizing the issuance of the outstanding bonds.
563-16   (V.A.C.S. Art. 835h, Sec. 4.)
563-17           (Sections 1506.012-1506.050 reserved for expansion)
563-18        SUBCHAPTER B.  BONDS FOR PARKING FACILITIES IN HOME-RULE
563-19                             MUNICIPALITIES
563-20         Sec. 1506.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
563-21   applies only to a home-rule municipality.  (V.A.C.S. Art. 1175e,
563-22   Sec. 1 (part).)
563-23         Sec. 1506.052.  AUTHORITY FOR PARKING FACILITIES.  (a)  A
563-24   municipality may establish, acquire, lease as lessor or lessee,
563-25   construct, improve, enlarge, equip, repair, operate, or maintain a
563-26   structure, parking area, parking garage, or facility for off-street
563-27   parking or storage of motor vehicles or other conveyances.
 564-1         (b)  The municipality may:
 564-2               (1)  regulate the use of a facility authorized by
 564-3   Subsection (a); and
 564-4               (2)  establish charges for use of the facility.
 564-5   (V.A.C.S. Art. 1175e, Secs. 1 (part), 2 (part).)
 564-6         Sec. 1506.053.  AUTHORITY TO ESTABLISH IMPROVEMENT DISTRICTS
 564-7   AND ISSUE BONDS.  The governing body of a municipality may:
 564-8               (1)  designate by clearly defined boundaries one or
 564-9   more improvement districts within the municipality; and
564-10               (2)  borrow money on the credit of the municipality by
564-11   issuing bonds as provided by this subchapter to acquire or
564-12   construct a facility authorized by Section 1506.052.  (V.A.C.S.
564-13   Art. 1175e, Sec. 3 (part).)
564-14         Sec. 1506.054.  ELECTION.  (a)  A municipality may not issue
564-15   bonds to acquire or construct a facility in an improvement district
564-16   under this subchapter unless a majority of the qualified voters of
564-17   the improvement district voting at an election held for that
564-18   purpose approve the issuance of the bonds.
564-19         (b)  Each proposition to issue bonds in an improvement
564-20   district under this subchapter must distinctly specify the purpose
564-21   for which the bonds are to be issued and the facility to be
564-22   acquired or constructed.   (V.A.C.S. Art. 1175e, Sec. 3 (part).)
564-23         Sec. 1506.055.  FORM OF BOND.  A bond issued under this
564-24   subchapter must specify the purpose for which it is issued.
564-25   (V.A.C.S. Art. 1175e, Sec. 3 (part).)
564-26         Sec. 1506.056.  SALE OF BONDS.  A municipality may sell bonds
564-27   issued under this subchapter in lots as the governing body of the
 565-1   municipality directs.  (V.A.C.S. Art. 1175e, Sec. 3 (part).)
 565-2         Sec. 1506.057.  INTEREST AND SINKING FUND TAX.  (a)  A
 565-3   municipality may not issue bonds under this subchapter creating a
 565-4   debt against the municipality or an improvement district unless the
 565-5   municipality provides for the imposition of an annual ad valorem
 565-6   tax on property in the improvement district at a rate sufficient
 565-7   to:
 565-8               (1)  pay the interest on the bonds; and
 565-9               (2)  create a sinking fund of at least two percent on
565-10   the bonds.
565-11         (b)  The rate of the tax may not exceed 50 cents on the $100
565-12   valuation of property taxable by the municipality.
565-13         (c)  The tax is in addition to other taxes imposed by the
565-14   municipality or authorized to be imposed by the municipal charter.
565-15   (V.A.C.S. Art. 1175e, Sec. 3 (part).)
565-16         Sec. 1506.058.  PROCEEDS OF TAX.  The municipal treasurer
565-17   shall keep money from the tax imposed under Section 1506.057 in a
565-18   fund separate from other funds.  (V.A.C.S. Art. 1175e, Sec. 3
565-19   (part).)
565-20         Sec. 1506.059.  INVESTMENT OF SINKING FUND.  The sinking fund
565-21   for bonds issued under this subchapter may be invested in
565-22   securities that are permitted by law for the investment of sinking
565-23   funds for other municipal bonds.  (V.A.C.S. Art. 1175e, Sec. 3
565-24   (part).)
565-25         Sec. 1506.060.  EMINENT DOMAIN.  A municipality may exercise
565-26   the power of eminent domain to acquire the fee simple title to
565-27   property to provide a site for a facility authorized by Section
 566-1   1506.052.  (V.A.C.S. Art. 1175e, Sec. 2 (part).)
 566-2         Sec. 1506.061.  RELOCATION OR ALTERATION EXPENSE.  If a
 566-3   municipality, in the exercise of a power under this subchapter,
 566-4   including the power of relocation, makes necessary the relocation
 566-5   or rerouting of, or alteration of the construction of, a highway,
 566-6   railroad, electric transmission line, telegraph or telephone
 566-7   property or facility, or pipeline, the relocation or rerouting or
 566-8   alteration of construction must be accomplished at the sole expense
 566-9   of the municipality.  In this section, "sole expense" means the
566-10   actual cost of the relocation or rerouting or alteration of
566-11   construction to provide comparable replacement without enhancement
566-12   of the facility, after deduction of the net salvage value derived
566-13   from the old facility.  (V.A.C.S. Art. 1175e, Sec. 2 (part).)
566-14           (Sections 1506.062-1506.100 reserved for expansion)
566-15          SUBCHAPTER C.  REVENUE BONDS FOR PARKING IMPROVEMENTS
566-16                    IN CERTAIN COASTAL MUNICIPALITIES
566-17         Sec. 1506.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
566-18   applies only to a municipality that:
566-19               (1)  is located on the Gulf of Mexico or on a channel,
566-20   canal, bay, or inlet connected to the Gulf of Mexico; and
566-21               (2)  has a population of:
566-22                     (A)  more than 60,000 and less than 75,000; or
566-23                     (B)  more than 110,000 and less than 120,000.
566-24   (V.A.C.S. Art. 1269j-4.3, Sec. 1.)
566-25         Sec. 1506.102.  DEFINITION.  In this subchapter, "parking
566-26   improvement" means a permanent public improvement consisting of a
566-27   structure, parking area, or facility for off-street parking or
 567-1   storage of motor vehicles or other conveyances.  (V.A.C.S.
 567-2   Art. 1269j-4.3, Sec. 2 (part).)
 567-3         Sec. 1506.103.  AUTHORITY FOR PARKING IMPROVEMENTS.  A
 567-4   municipality may establish, acquire, lease as lessor or lessee,
 567-5   construct, improve, enlarge, equip, repair, operate, or maintain a
 567-6   parking improvement.  (V.A.C.S. Art. 1269j-4.3, Sec. 2 (part).)
 567-7         Sec. 1506.104.  AUTHORITY TO ISSUE REVENUE BONDS.  The
 567-8   governing body of a municipality by ordinance may issue revenue
 567-9   bonds to provide all or part of the money to establish, acquire,
567-10   lease, construct, improve, enlarge, equip, or repair a parking
567-11   improvement.  (V.A.C.S. Art. 1269j-4.3, Secs. 3(a), (b) (part).)
567-12         Sec. 1506.105.  PLEDGE OF REVENUE.  (a)  Bonds issued under
567-13   this subchapter must be secured by a pledge of and be payable from
567-14   all or a designated part of the revenue from the parking
567-15   improvement for which the bonds are issued, as provided in the
567-16   ordinance authorizing the issuance of the bonds.
567-17         (b)  The pledge securing the bonds is inferior to any
567-18   previous pledge of the revenue for the payment of revenue bonds or
567-19   revenue refunding bonds that are outstanding.  (V.A.C.S.
567-20   Art. 1269j-4.3, Sec. 3(b) (part).)
567-21         Sec. 1506.106.  LIEN ON PARKING IMPROVEMENT.  Subject to any
567-22   limitation contained in any previous pledge, the governing body of
567-23   a municipality may, in addition to pledging the revenue from a
567-24   parking improvement, give a lien on all or part of the physical
567-25   property acquired with the proceeds from the sale of bonds issued
567-26   under this subchapter.  (V.A.C.S. Art. 1269j-4.3, Sec. 3(b)
567-27   (part).)
 568-1         Sec. 1506.107.  BONDS NOT PAYABLE FROM TAXES.  The owner or
 568-2   holder of a bond issued under this subchapter is not entitled to
 568-3   demand payment of the principal of or interest on the bond from
 568-4   money raised by taxation.  (V.A.C.S. Art. 1269j-4.3, Sec. 4.)
 568-5         Sec. 1506.108.  CONTENTS OF ORDINANCE AUTHORIZING BONDS.  (a)
 568-6   The ordinance authorizing the issuance of bonds under this
 568-7   subchapter may provide for the flow of funds and the establishment
 568-8   and maintenance of an interest and sinking fund, reserve fund, or
 568-9   other fund.
568-10         (b)  The ordinance may:
568-11               (1)  prohibit the issuance of additional bonds or other
568-12   obligations payable from the pledged revenue; or
568-13               (2)  reserve the right to issue additional bonds to be
568-14   secured by a pledge of and payable from the revenue on a parity
568-15   with, or subordinate to, the lien and pledge in support of the
568-16   bonds being issued, subject to the conditions prescribed by the
568-17   ordinance.
568-18         (c)  The ordinance may contain any other provision or
568-19   covenant, including a covenant with respect to the bonds, the
568-20   pledged revenue, or the operation and maintenance of the parking
568-21   improvement the revenue of which is pledged.  The ordinance may
568-22   provide for the operation or lease, as lessor or lessee, of all or
568-23   part of the parking improvement and the use or pledge of money
568-24   derived from operation contracts and leases.  (V.A.C.S.
568-25   Art. 1269j-4.3, Sec. 5 (part).)
568-26         Sec. 1506.109.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
568-27   municipality may adopt and have executed any other proceeding or
 569-1   instrument necessary or convenient to the issuance of bonds under
 569-2   this subchapter.  (V.A.C.S. Art. 1269j-4.3, Sec. 5 (part).)
 569-3         Sec. 1506.110.  MATURITY.  A bond issued under this
 569-4   subchapter must mature not later than 40 years after its date.
 569-5   (V.A.C.S. Art. 1269j-4.3, Sec. 7 (part).)
 569-6         Sec. 1506.111.  SIGNATURES.  A bond issued under this
 569-7   subchapter must be signed by the mayor of the municipality and
 569-8   countersigned by the secretary or clerk of the municipality.
 569-9   (V.A.C.S.  Art. 1269j-4.3, Sec. 7 (part).)
569-10         Sec. 1506.112.  SALE OF BONDS.  A municipality may sell bonds
569-11   issued under this subchapter under the terms determined by the
569-12   governing body of the municipality to be the most advantageous and
569-13   reasonably obtainable.  (V.A.C.S. Art. 1269j-4.3, Sec. 7 (part).)
569-14         Sec. 1506.113.  INVESTMENT OF BOND PROCEEDS AND FUNDS.  (a)
569-15   The bond proceeds, until they are needed to implement the purpose
569-16   for which the bonds were issued, may be invested in direct
569-17   obligations of the United States, placed on time deposit, or both.
569-18         (b)  Money in an interest and sinking fund, reserve fund, or
569-19   any other fund established or provided for in the bond ordinance
569-20   may be invested in the manner and in the securities as provided in
569-21   the bond ordinance.  (V.A.C.S. Art. 1269j-4.3, Sec. 6 (part).)
569-22         Sec. 1506.114.  CHARGES FOR SERVICES.  The governing body of
569-23   a municipality shall impose and collect charges for services
569-24   provided in connection with a parking improvement the revenue of
569-25   which is pledged to secure bonds issued under this subchapter in
569-26   amounts at least sufficient to comply with each covenant or
569-27   provision in the ordinance authorizing the issuance of the bonds.
 570-1   (V.A.C.S. Art. 1269j-4.3, Sec. 3(c).)
 570-2         Sec. 1506.115.  REFUNDING BONDS.  (a)  The governing body of
 570-3   a municipality by ordinance may issue revenue refunding bonds to
 570-4   refund bonds, including revenue refunding bonds, issued under this
 570-5   subchapter.
 570-6         (b)  Refunding bonds issued under this section must be
 570-7   executed and mature as provided by this subchapter for original
 570-8   bonds.
 570-9         (c)  The comptroller shall register refunding bonds on
570-10   surrender and cancellation of the bonds to be refunded.
570-11         (d)  The comptroller shall register refunding bonds without
570-12   the surrender and cancellation of the bonds to be refunded if the
570-13   ordinance authorizing the issuance of the refunding bonds requires
570-14   the obligation to be sold and the proceeds from the sale to be
570-15   deposited in a place where the bonds to be refunded are payable.
570-16         (e)  Refunding bonds to which Subsection (d) applies may be
570-17   issued in an amount sufficient to pay:
570-18               (1)  the principal of the bonds to be refunded; and
570-19               (2)  the interest on the bonds to be refunded to the
570-20   option or maturity date of the bonds.  (V.A.C.S. Art. 1269j-4.3,
570-21   Sec. 8 (part).)
570-22         Sec. 1506.116.  CONFLICT WITH MUNICIPAL CHARTER.  To the
570-23   extent of a conflict between this subchapter and a municipal
570-24   charter, this subchapter controls.  (V.A.C.S. Art. 1269j-4.3, Sec.
570-25   10 (part).)
570-26           (Sections 1506.117-1506.150 reserved for expansion)
570-27       SUBCHAPTER D.  REVENUE BONDS FOR PARKING AND TRANSPORTATION
 571-1    FACILITIES IN MUNICIPALITIES WITH POPULATION OF MORE THAN 650,000
 571-2         Sec. 1506.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 571-3   applies only to a municipality with a population of more than
 571-4   650,000.  (V.A.C.S. Art. 1269j-4.8, Sec. 1.)
 571-5         Sec. 1506.152.  AUTHORITY FOR PARKING AND TRANSPORTATION
 571-6   FACILITIES.  (a)  A municipality may acquire, lease as lessor or
 571-7   lessee, construct, improve, enlarge, equip, and operate:
 571-8               (1)  an off-street parking facility; or
 571-9               (2)  a terminal or station and related properties and
571-10   facilities for use by:
571-11                     (A)  passengers, commuters, travelers, shippers,
571-12   and other members of the public; and
571-13                     (B)  companies or individuals engaged in the
571-14   business of transporting the public or freight by bus, truck, or
571-15   rail.
571-16         (b)  A municipality may create an off-street parking system
571-17   by combining one or more parking facilities established under
571-18   Subsection (a)  with one or more other parking facilities
571-19   previously owned by the municipality or acquired under a law other
571-20   than this subchapter that authorizes the municipality to own and
571-21   operate parking facilities, whether or not the other facility or
571-22   facilities are operated in connection with any other municipally
571-23   owned facility.  (V.A.C.S. Art. 1269j-4.8, Secs. 2, 6(d).)
571-24         Sec. 1506.153.  CONTRACTS AND LEASES; JOINT DEVELOPMENT.  (a)
571-25   A municipality may contract with any person to perform any function
571-26   related to a facility described by Section 1506.152(a).
571-27         (b)  A municipality may lease a facility or other property
 572-1   described by Section 1506.152(a) to any person on the terms
 572-2   approved by the governing body of the municipality, including the
 572-3   amounts of rental, revenue, and payments and the period of years.
 572-4         (c)  A facility or other property described by Section
 572-5   1506.152(a) may be developed with another public or private
 572-6   development under an agreement with the owner of the development on
 572-7   the terms approved by the municipality.  The municipality may
 572-8   include as a part of an agreement the provisions the municipality
 572-9   determines are appropriate for the use, lease, or sale of any part
572-10   of the subsurface, or airspace above the surface, of the
572-11   municipality's property that the municipality determines is not
572-12   necessary for the purposes of the facility or other property.
572-13   (V.A.C.S. Art. 1269j-4.8, Secs. 5(b), (c).)
572-14         Sec. 1506.154.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  The
572-15   governing body of a municipality by ordinance may issue revenue
572-16   bonds for a purpose authorized by Section 1506.152(a).
572-17         (b)  A municipality that proposes to create an off-street
572-18   parking system under Section 1506.152(b) may by ordinance issue
572-19   bonds for the purposes of creating, extending, or improving the
572-20   system to the same extent otherwise provided by this subchapter for
572-21   bonds issued for a single parking facility.  (V.A.C.S.
572-22   Art. 1269j-4.8, Secs. 3 (part), 6(e) (part).)
572-23         Sec. 1506.155.  PLEDGE OF REVENUE.  (a)  A municipality may
572-24   pledge all or part of the revenue, income, or receipts from the
572-25   charges authorized by Section 1506.161 to the payment of bonds
572-26   issued under Section 1506.154(a), including principal, interest,
572-27   and any other amounts required or permitted in connection with the
 573-1   bonds.
 573-2         (b)  A municipality may pledge to the payment of bonds issued
 573-3   under Section 1506.154(b) all or part of the revenue, income, or
 573-4   receipts from:
 573-5               (1)  the ownership or operation of any facility
 573-6   included in the municipality's parking system established under
 573-7   Section 1506.152(b); or
 573-8               (2)  parking meters on or adjacent to the public
 573-9   streets of the municipality.  (V.A.C.S. Art. 1269j-4.8, Secs. 3
573-10   (part), 6(a) (part), (e) (part).)
573-11         Sec. 1506.156.  ADDITIONAL SECURITY.  (a)  Bonds issued under
573-12   this subchapter may be additionally secured by:
573-13               (1)  an encumbrance on any real property relating to a
573-14   facility authorized by this subchapter owned or to be acquired by
573-15   the municipality;
573-16               (2)  an encumbrance on any personal property
573-17   appurtenant to that real property; or
573-18               (3)  a pledge of any portion of a grant, donation,
573-19   revenue, or income received or to be received from the United
573-20   States or any other public or private source.
573-21         (b)  The governing body of the municipality may authorize the
573-22   execution of a trust indenture, mortgage, deed of trust, or other
573-23   instrument as evidence of the encumbrance.  (V.A.C.S.
573-24   Art. 1269j-4.8, Secs. 6(b), (c).)
573-25         Sec. 1506.157.  MATURITY.  A bond issued under this
573-26   subchapter must mature not later than 40 years after its date.
573-27   (V.A.C.S. Art. 1269j-4.8, Sec. 4(a) (part).)
 574-1         Sec. 1506.158.  ADDITIONAL BONDS.  The ordinance authorizing
 574-2   the issuance of bonds under this subchapter may provide for the
 574-3   subsequent issuance of additional parity bonds or subordinate lien
 574-4   bonds under terms specified in the ordinance.  (V.A.C.S.
 574-5   Art. 1269j-4.8, Sec.  4(a) (part).)
 574-6         Sec. 1506.159.  SALE OF BONDS.  A municipality may sell bonds
 574-7   issued under this subchapter in the manner and under the terms
 574-8   provided by the ordinance authorizing the issuance of the bonds.
 574-9   (V.A.C.S. Art. 1269j-4.8, Sec. 4(b) (part).)
574-10         Sec. 1506.160.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
574-11   BONDS.  (a)  If bonds issued under this subchapter state that they
574-12   are secured by a pledge of revenue or rents from a contract,
574-13   including a lease contract, a copy of the contract and the
574-14   proceedings related to it must be submitted to the attorney
574-15   general.
574-16         (b)  If the attorney general finds that the bonds have been
574-17   authorized and the contract has been made in accordance with law,
574-18   the attorney general shall approve the contract.
574-19         (c)  After the bonds are approved and registered as provided
574-20   by Chapter 1202 and the contract is approved as provided by
574-21   Subsection (b), the contract is incontestable in a court or other
574-22   forum for any reason and is a valid and binding obligation for all
574-23   purposes in accordance with its terms.  (V.A.C.S. Art. 1269j-4.8,
574-24   Sec. 9 (part).)
574-25         Sec. 1506.161.  CHARGES.  (a)  The governing body of a
574-26   municipality may impose and collect charges for the use or
574-27   availability of a facility or other property described by Section
 575-1   1506.152(a) in the amounts and manner determined by the governing
 575-2   body.
 575-3         (b)  A municipality shall impose pledged charges in amounts
 575-4   that will be at least sufficient, with any other pledged resources,
 575-5   to provide for the payment of:
 575-6               (1)  the principal of, interest on, and any other
 575-7   amounts required in connection with the bonds to which the charges
 575-8   are pledged; and
 575-9               (2)  to the extent required by the ordinance
575-10   authorizing the issuance of the bonds:
575-11                     (A)  expenses incurred in connection with the
575-12   bonds; and
575-13                     (B)  operation, maintenance, and other expenses
575-14   incurred in connection with the facility.  (V.A.C.S.
575-15   Art. 1269j-4.8, Secs. 5(a), 6(a) (part).)
575-16         Sec. 1506.162.  REFUNDING BONDS.  (a)  A municipality may
575-17   refund or otherwise refinance bonds issued under this subchapter by
575-18   issuing refunding bonds under any terms provided by ordinance of
575-19   the governing body of the municipality.
575-20         (b)  All appropriate provisions of this subchapter apply to
575-21   the refunding bonds.  The refunding bonds shall be issued in the
575-22   manner provided by this subchapter for other bonds.
575-23         (c)  The refunding bonds may be sold and delivered in amounts
575-24   sufficient to pay the principal of and interest and any redemption
575-25   premium on the bonds to be refunded, at maturity or on any
575-26   redemption date.
575-27         (d)  The refunding bonds may be issued to be exchanged for
 576-1   the bonds being refunded by them.  In that case, the comptroller
 576-2   shall register the refunding bonds and deliver them to the holder
 576-3   of the bonds being refunded as provided by the ordinance
 576-4   authorizing the refunding bonds.  The exchange may be made in one
 576-5   delivery or in installment deliveries.  (V.A.C.S. Art. 1269j-4.8,
 576-6   Secs.  8(a), (b).)
 576-7         Sec. 1506.163.  PUBLIC PURPOSE.  The acquisition,
 576-8   construction, improvement, enlargement, equipment, operation, and
 576-9   maintenance of a facility or other property described by Section
576-10   1506.152(a) is a public purpose and proper municipal function.
576-11   (V.A.C.S. Art. 1269j-4.8, Sec. 7.)
576-12         Sec. 1506.164.  CONFLICT WITH OTHER LAW.  When bonds are
576-13   issued under this subchapter, to the extent of any conflict between
576-14   this subchapter and another law, this subchapter controls.
576-15   (V.A.C.S. Art. 1269j-4.8, Sec. 11 (part).)
576-16            CHAPTER 1507.  OBLIGATIONS RELATING TO MUNICIPAL
576-17                            DEBT AND EXPENSES
576-18              SUBCHAPTER A.  BONDS FOR PAYMENT OF JUDGMENTS
576-19   Sec. 1507.001.  AUTHORITY TO ISSUE BONDS
576-20   Sec. 1507.002.  ELECTION
576-21   Sec. 1507.003.  MATURITY
576-22           (Sections 1507.004-1507.050 reserved for expansion)
576-23        SUBCHAPTER B.  REFUNDING OF REFUNDING BONDS ISSUED UNDER
576-24                             BANKRUPTCY PLAN
576-25   Sec. 1507.051.  AUTHORITY TO ISSUE REFUNDING BONDS
576-26   Sec. 1507.052.  SALE OF BONDS
576-27   Sec. 1507.053.  SIGNATURES
 577-1   Sec. 1507.054.  APPLICABILITY OF MUNICIPAL CHARTER
 577-2           (Sections 1507.055-1507.100 reserved for expansion)
 577-3         SUBCHAPTER C.  REFUNDING OF REFUNDING BONDS ADJUDICATED
 577-4                AS VALID OR ISSUED UNDER BANKRUPTCY PLAN
 577-5   Sec. 1507.101.  AUTHORITY TO ISSUE REFUNDING BONDS
 577-6   Sec. 1507.102.  SALE OF BONDS
 577-7   Sec. 1507.103.  SIGNATURES
 577-8   Sec. 1507.104.  APPLICABILITY OF MUNICIPAL CHARTER
 577-9           (Sections 1507.105-1507.150 reserved for expansion)
577-10        SUBCHAPTER D.  TAX BONDS FOR PAYMENT OF CURRENT EXPENSES
577-11   Sec. 1507.151.  AUTHORITY TO ISSUE BONDS
577-12   Sec. 1507.152.  PLEDGE OF TAX
577-13   Sec. 1507.153.  ELECTION
577-14   Sec. 1507.154.  LIMITATION
577-15   Sec. 1507.155.  MATURITY
577-16   Sec. 1507.156.  SALE OF BONDS
577-17   Sec. 1507.157.  NO WAIVER OF CLAIMS
577-18   Sec. 1507.158.  REDEMPTION OF BONDS
577-19   Sec. 1507.159.  CONFLICT WITH MUNICIPAL CHARTER
577-20   Sec. 1507.160.  CONSTRUCTION
577-21           (Sections 1507.161-1507.200 reserved for expansion)
577-22        SUBCHAPTER E.  NOTES TO FUND OR REFUND GENERAL OPERATING
577-23             EXPENSES IN MUNICIPALITIES WITH A POPULATION OF
577-24                            35,000 TO 45,000
577-25   Sec. 1507.201.  APPLICABILITY OF SUBCHAPTER
577-26   Sec. 1507.202.  AUTHORITY TO ISSUE NOTES
577-27   Sec. 1507.203.  ELECTION
 578-1   Sec. 1507.204.  AUTHORITY TO PASS ORDINANCES AND
 578-2                     RESOLUTIONS
 578-3   Sec. 1507.205.  MATURITY
 578-4   Sec. 1507.206.  PLEDGE
 578-5   Sec. 1507.207.  PAYMENT OF WARRANTS WHILE NOTES ARE
 578-6                     OUTSTANDING
 578-7           (Sections 1507.208-1507.250 reserved for expansion)
 578-8         SUBCHAPTER F.  BONDS FOR PAYMENT OF CURRENT EXPENSES IN
 578-9           MUNICIPALITIES WITH A POPULATION OF 161,000 OR MORE
578-10   Sec. 1507.251.  APPLICABILITY OF SUBCHAPTER
578-11   Sec. 1507.252.  AUTHORITY TO ISSUE WARRANTS OR NOTES
578-12   Sec. 1507.253.  PLEDGE OF REVENUE; PAYMENT
578-13   Sec. 1507.254.  LIMITATION ON AMOUNT OF WARRANTS AND NOTES
578-14                     ISSUED
578-15   Sec. 1507.255.  SALE OF WARRANTS OR NOTES
578-16            CHAPTER 1507.  OBLIGATIONS RELATING TO MUNICIPAL
578-17                            DEBT AND EXPENSES
578-18              SUBCHAPTER A.  BONDS FOR PAYMENT OF JUDGMENTS
578-19         Sec. 1507.001.  AUTHORITY TO ISSUE BONDS.  A municipality may
578-20   issue, sell, and deliver bonds in an amount sufficient to pay a
578-21   final judgment of a court, plus the interest and the costs and
578-22   expenses connected with the judgment, if:
578-23               (1)  the judgment is against the municipality or the
578-24   payment of the judgment is the legal responsibility of the
578-25   municipality;
578-26               (2)  the judgment awards the plaintiff an amount in
578-27   cash; and
 579-1               (3)  the municipality does not have money available to
 579-2   pay the amount of the judgment plus the interest and the cost and
 579-3   expenses connected with the judgment or decree.  (V.A.C.S.
 579-4   Art. 835r, Sec. 1 (part).)
 579-5         Sec. 1507.002.  ELECTION.  (a)  A municipality may not issue
 579-6   bonds under this subchapter unless the bonds are authorized by a
 579-7   majority vote of the qualified voters of the municipality voting at
 579-8   an election held for that purpose.
 579-9         (b)  A municipality shall hold an election to issue bonds
579-10   under this subchapter in the manner provided for other bond
579-11   elections in the municipality.  (V.A.C.S. Art. 835r, Sec. 1
579-12   (part).)
579-13         Sec. 1507.003.  MATURITY.  A bond issued under this
579-14   subchapter must mature not later than 40 years after its date.
579-15   (V.A.C.S. Art. 835r, Sec. 1 (part).)
579-16           (Sections 1507.004-1507.050 reserved for expansion)
579-17        SUBCHAPTER B.  REFUNDING OF REFUNDING BONDS ISSUED UNDER
579-18                             BANKRUPTCY PLAN
579-19         Sec. 1507.051.  AUTHORITY TO ISSUE REFUNDING BONDS.  (a)  The
579-20   governing body of a municipality by ordinance may issue refunding
579-21   bonds in accordance with Subchapters A and D, Chapter 1207, to
579-22   refund outstanding refunding bonds if:
579-23               (1)  the bonds to be refunded were issued under a plan
579-24   for the adjustment of the municipality's debts confirmed by a
579-25   bankruptcy court under Title 11, United States Code; and
579-26               (2)  the bonds do not mature in annual installments.
579-27         (b)  The governing body of a municipality that issues bonds
 580-1   under this subchapter to refund revenue bonds may secure the bonds
 580-2   issued under this subchapter by a deed of trust on the
 580-3   municipality's utility system or by a pledge of the net revenue of
 580-4   the system if the bonds being refunded provide for that pledge.
 580-5   (V.A.C.S. Art. 802g, Secs. 1, 2 (part), 5 (part).)
 580-6         Sec. 1507.052.  SALE OF BONDS.  (a)  Instead of exchanging
 580-7   refunding bonds issued under this subchapter for the bonds being
 580-8   refunded, a municipality may, at any time after calling the bonds
 580-9   being refunded for redemption in the manner provided in those
580-10   bonds, sell the refunding bonds or the unexchanged portion of the
580-11   refunding bonds.
580-12         (b)  The municipality shall deposit the principal amount
580-13   received from the sale of the refunding bonds, and the additional
580-14   amount necessary to pay the interest to the call date, with the
580-15   bank at which the bonds being refunded are payable.
580-16         (c)  The municipality shall send to the comptroller a
580-17   certified copy of the ordinance authorizing the refunding bonds.
580-18   The comptroller shall register the refunding bonds without the
580-19   cancellation of the bonds being refunded and shall deliver the
580-20   refunding bonds as provided in the ordinance.  (V.A.C.S.
580-21   Art. 802g, Sec. 3 (part).)
580-22         Sec. 1507.053.  SIGNATURES.  A bond issued under this
580-23   subchapter must be signed by the mayor of the municipality and the
580-24   secretary or clerk of the municipality.  (V.A.C.S. Art. 802g, Sec.
580-25   5 (part).)
580-26         Sec. 1507.054.  APPLICABILITY OF MUNICIPAL CHARTER.  A
580-27   provision of a municipal charter relating to the terms, issuance,
 581-1   sale, or delivery of bonds does not apply to a bond issued under
 581-2   this subchapter.  (V.A.C.S. Art. 802g, Sec. 3 (part).)
 581-3           (Sections 1507.055-1507.100 reserved for expansion)
 581-4       SUBCHAPTER C.  REFUNDING OF REFUNDING BONDS ADJUDICATED AS
 581-5                  VALID OR ISSUED UNDER BANKRUPTCY PLAN
 581-6         Sec. 1507.101.  AUTHORITY TO ISSUE REFUNDING BONDS.  The
 581-7   governing body of a municipality by ordinance may issue refunding
 581-8   bonds in accordance with Subchapters A and D, Chapter 1207, to
 581-9   refund outstanding refunding bonds:
581-10               (1)  that:
581-11                     (A)  a federal court by decree adjudicated to be
581-12   valid; or
581-13                     (B)  were issued under a plan for the adjustment
581-14   of the municipality's debts confirmed by a bankruptcy court under
581-15   Title 11, United States Code; and
581-16               (2)  that were issued under the authority of an
581-17   ordinance specifying a minimum fixed tax rate to be imposed in each
581-18   year during which any of those bonds or interest on those bonds is
581-19   outstanding.  (V.A.C.S. Art. 802h, Secs. 1, 2 (part), 4 (part).)
581-20         Sec. 1507.102.  SALE OF BONDS.  (a)  Instead of exchanging
581-21   refunding bonds issued under this subchapter for the bonds being
581-22   refunded, a municipality may sell the refunding bonds or the
581-23   unexchanged portion of the refunding bonds.
581-24         (b)  The municipality shall deposit the principal amount
581-25   received from the sale of the refunding bonds, and the additional
581-26   amount necessary to pay the interest to the call date or maturity
581-27   dates, with the bank at which the original refunding bonds are
 582-1   payable.
 582-2         (c)  The municipality shall send to the comptroller a
 582-3   certified copy of the ordinance authorizing the refunding bonds.
 582-4   The comptroller shall register the refunding bonds without the
 582-5   cancellation of the bonds being refunded and shall deliver the
 582-6   refunding bonds as provided in the ordinance.  (V.A.C.S. Art. 802h,
 582-7   Sec. 3 (part).)
 582-8         Sec. 1507.103.  SIGNATURES.  A bond issued under this
 582-9   subchapter must be signed by the mayor of the municipality and the
582-10   secretary or clerk of the municipality.  (V.A.C.S. Art. 802h, Sec.
582-11   4 (part).)
582-12         Sec. 1507.104.  APPLICABILITY OF MUNICIPAL CHARTER.  A
582-13   provision of a municipal charter relating to the terms, issuance,
582-14   sale, or delivery of bonds does not apply to a bond issued under
582-15   this subchapter.  (V.A.C.S.  Art. 802h, Sec. 3 (part).)
582-16           (Sections 1507.105-1507.150 reserved for expansion)
582-17        SUBCHAPTER D.  TAX BONDS FOR PAYMENT OF CURRENT EXPENSES
582-18         Sec. 1507.151.  AUTHORITY TO ISSUE BONDS.  (a)  The governing
582-19   body of a municipality by ordinance may issue bonds secured by and
582-20   payable from ad valorem taxes to provide for the payment of all or
582-21   part of the municipality's current expenses for a fiscal year if:
582-22               (1)  in that fiscal year the municipality has lost or
582-23   is likely to lose an amount that is:
582-24                     (A)  more than $15 million; and
582-25                     (B)  more than 15 percent of the municipality's
582-26   budget for the fiscal year, not including the amount necessary for
582-27   debt service; and
 583-1               (2)  the loss or potential loss is the result of a
 583-2   person who received municipal funds seeking or acceding to
 583-3   protection under Title 11, United States Code.
 583-4         (b)  A determination by the municipality's governing body
 583-5   that a loss has occurred or is likely to occur, or of the amount of
 583-6   a loss or anticipated loss, is conclusive.  (V.A.C.S. Art. 1066g,
 583-7   Secs. 1(a), (b), (c).)
 583-8         Sec. 1507.152.  PLEDGE OF TAX.  The governing body may pledge
 583-9   to the payment of the bonds issued under this subchapter an ad
583-10   valorem tax sufficient to pay when due the principal of and
583-11   interest on the bonds.  (V.A.C.S.  Art. 1066g, Sec. 3 (part).)
583-12         Sec. 1507.153.  ELECTION.  The governing body of a
583-13   municipality may issue bonds under this subchapter without an
583-14   election.  (V.A.C.S. Art. 1066g, Sec. 2 (part).)
583-15         Sec. 1507.154.  LIMITATION.  A municipality may not issue
583-16   bonds under this subchapter in a principal amount that:
583-17               (1)  exceeds the amount of loss sustained or
583-18   anticipated by the municipality and the cost of issuing the bonds;
583-19   or
583-20               (2)  would result in the outstanding aggregate
583-21   principal amount of tax bond indebtedness of the municipality
583-22   exceeding 10 percent of the assessed valuation of taxable property
583-23   in the municipality according to the most recent ad valorem tax
583-24   roll of the municipality.  (V.A.C.S. Art. 1066g, Sec. 4.)
583-25         Sec. 1507.155.  MATURITY.  Bonds issued under this subchapter
583-26   must mature not later than five years after their date of issuance
583-27   as provided by the ordinance authorizing the issuance and sale of
 584-1   the bonds.  (V.A.C.S. Art. 1066g, Sec. 2 (part).)
 584-2         Sec. 1507.156.  SALE OF BONDS.  A municipality may sell bonds
 584-3   issued under this subchapter at a public or private sale as
 584-4   provided by the ordinance authorizing the issuance and sale of the
 584-5   bonds.  (V.A.C.S. Art. 1066g, Sec. 2 (part).)
 584-6         Sec. 1507.157.  NO WAIVER OF CLAIMS.  (a)  A municipality's
 584-7   action under this subchapter does not affect or abrogate any claim
 584-8   the municipality may have with respect to a loss described by
 584-9   Section 1507.151.
584-10         (b)  A municipality that issues bonds under this subchapter:
584-11               (1)  does not waive any claim of the municipality;
584-12               (2)  is not estopped from recovering on a claim of the
584-13   municipality; and
584-14               (3)  does not ratify any prior action by the
584-15   municipality in connection with the loss.
584-16         (c)  A municipality may reserve any claim the municipality
584-17   may have in its action authorizing the bonds.  (V.A.C.S.
584-18   Art. 1066g, Sec. 1(d).)
584-19         Sec. 1507.158.  REDEMPTION OF BONDS.  After the recovery of a
584-20   loss described by Section 1507.151 or the failure of an anticipated
584-21   loss described by Section 1507.151 to occur, the governing body
584-22   shall promptly redeem bonds issued to cover the loss or anticipated
584-23   loss in a principal amount equal to the amount recovered or the
584-24   amount of anticipated loss that did not occur.  (V.A.C.S.
584-25   Art. 1066g, Sec. 8.)
584-26         Sec. 1507.159.  CONFLICT WITH MUNICIPAL CHARTER.  To the
584-27   extent of a conflict between this subchapter and a municipal
 585-1   charter, this subchapter controls.  (V.A.C.S. Art. 1066g, Sec. 9
 585-2   (part).)
 585-3         Sec. 1507.160.  CONSTRUCTION.  This subchapter shall be
 585-4   liberally construed to achieve the legislative intent and purposes
 585-5   of this subchapter.  A power granted by this subchapter shall be
 585-6   broadly interpreted to achieve that intent and those purposes.
 585-7   (V.A.C.S. Art. 1066g, Sec. 10.)
 585-8           (Sections 1507.161-1507.200 reserved for expansion)
 585-9    SUBCHAPTER E.  NOTES TO FUND OR REFUND GENERAL OPERATING EXPENSES
585-10         IN MUNICIPALITIES WITH A POPULATION OF 35,000 TO 45,000
585-11         Sec. 1507.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
585-12   applies only to a home-rule or special-law municipality with a
585-13   population of 35,000 to 45,000.  (V.A.C.S.  Art. 802b-3, Sec. 1
585-14   (part).)
585-15         Sec. 1507.202.  AUTHORITY TO ISSUE NOTES.  A municipality may
585-16   issue notes to fund or refund outstanding warrants that were drawn
585-17   against the municipality's general fund for general operating
585-18   expenses and issued during the calendar year preceding the calendar
585-19   year in which the notes are issued.  (V.A.C.S. Art. 802b-3, Secs. 1
585-20   (part), 3 (part).)
585-21         Sec. 1507.203.  ELECTION.  (a)  Before a municipality may
585-22   issue notes under this subchapter, the governing body of the
585-23   municipality shall order an election on the question of authorizing
585-24   the governing body to issue the notes.
585-25         (b)  The governing body shall hold, give notice of, and
585-26   declare the results of an election under this section in the manner
585-27   provided by general law for bond elections in the municipality.
 586-1   (V.A.C.S. Art. 802b-3, Sec. 2 (part).)
 586-2         Sec. 1507.204.  AUTHORITY TO PASS ORDINANCES AND RESOLUTIONS.
 586-3   If the issuance of the notes is authorized at the election, the
 586-4   governing body of the municipality may pass ordinances and
 586-5   resolutions for the issuance of the notes.  (V.A.C.S. Art. 802b-3,
 586-6   Sec. 3 (part).)
 586-7         Sec. 1507.205.  MATURITY.  A note issued under this
 586-8   subchapter must mature not later than 10 years after its date.
 586-9   (V.A.C.S. Art. 802b-3, Sec. 3 (part).)
586-10         Sec. 1507.206.  PLEDGE.  A municipality may pledge the full
586-11   faith and credit of the municipality to the payment of a note
586-12   issued under this subchapter and the interest on the note.
586-13   (V.A.C.S. Art. 802b-3, Sec. 3 (part).)
586-14         Sec. 1507.207.  PAYMENT OF WARRANTS WHILE NOTES ARE
586-15   OUTSTANDING.  If a warrant is drawn against the municipality's
586-16   general fund during a calendar year in which a note issued under
586-17   this subchapter is outstanding, the municipality shall pay the
586-18   warrant from current funds appropriated for the purpose for which
586-19   the warrant is drawn.  The municipality may not fund or refund the
586-20   warrant.  (V.A.C.S. Art. 802b-3, Sec. 3 (part).)
586-21           (Sections 1507.208-1507.250 reserved for expansion)
586-22         SUBCHAPTER F.  BONDS FOR PAYMENT OF CURRENT EXPENSES IN
586-23           MUNICIPALITIES WITH A POPULATION OF 161,000 OR MORE
586-24         Sec. 1507.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
586-25   applies only to a municipality with a population of 161,000 or
586-26   more.  (V.A.C.S. Art. 1264 (part).)
586-27         Sec. 1507.252.  AUTHORITY TO ISSUE WARRANTS OR NOTES.  (a)
 587-1   The governing body of a municipality may issue warrants or notes
 587-2   drawn against the current revenues of the municipality for the
 587-3   fiscal year to:
 587-4               (1)  provide for the payment of the municipality's
 587-5   expenses for the fiscal year in which the warrants or notes are
 587-6   issued or for any portion of that fiscal year; or
 587-7               (2)  refund the principal of and interest on warrants
 587-8   and notes issued under this subchapter.
 587-9         (b)  Warrants and notes issued under this subchapter must be
587-10   dated and numbered consecutively as issued.  (V.A.C.S. Art. 1264
587-11   (part).)
587-12         Sec. 1507.253.  PLEDGE OF REVENUE; PAYMENT.  (a)  A warrant
587-13   or note issued under this subchapter is a lien on:
587-14               (1)  the revenue of the municipality for the fiscal
587-15   year during which the warrant or note is issued that is available
587-16   for payment of the warrant or note; or
587-17               (2)  a designated portion of that revenue.
587-18         (b)  A municipality shall pay a warrant or note:
587-19               (1)  consecutively according to its respective date and
587-20   number as money for payment becomes available; or
587-21               (2)  on a date during the fiscal year on which, in the
587-22   estimate of the governing body, sufficient revenue will be
587-23   available for payment of the warrant or note.  (V.A.C.S. Art. 1264
587-24   (part).)
587-25         Sec. 1507.254.  LIMITATION ON AMOUNT OF WARRANTS AND NOTES
587-26   ISSUED.  (a)  The governing body may not issue warrants or notes
587-27   under this subchapter in an amount exceeding 80 percent of the
 588-1   difference between:
 588-2               (1)  the estimated revenue of the municipality for the
 588-3   fiscal year; and
 588-4               (2)  the sum of:
 588-5                     (A)  the interest on the bonded indebtedness of
 588-6   the municipality to be paid from that revenue; and
 588-7                     (B)  any amount that the municipality is required
 588-8   to pay from that revenue into a sinking fund, special fund, or
 588-9   special trust fund of the municipality.
588-10         (b)  The limitation prescribed by Subsection (a)  does not
588-11   apply to warrants or notes issued for refunding purposes.
588-12         (c)  The aggregate principal amount of warrants or notes
588-13   issued under this subchapter and outstanding at any time in a
588-14   fiscal year may not exceed the greatest amount by which the
588-15   proposed expenditures for the fiscal year are estimated by the
588-16   governing body to exceed the estimated revenue available for
588-17   payment of warrants and notes during the fiscal year, as computed
588-18   under Subsection (a).  (V.A.C.S. Art. 1264 (part).)
588-19         Sec. 1507.255.  SALE OF WARRANTS OR NOTES.  A municipality
588-20   may sell warrants or notes issued under this subchapter at a public
588-21   or private sale as provided in the ordinance authorizing the
588-22   issuance and sale of the warrants or notes.  (V.A.C.S. Art. 1264
588-23   (part).)
588-24             CHAPTER 1508.  OBLIGATIONS FOR MUNICIPAL PARKS,
588-25                  RECREATIONAL FACILITIES, AND AIRPORTS
588-26     SUBCHAPTER A.  OBLIGATIONS FOR PARKS, RECREATIONAL FACILITIES,
588-27                              AND AIRPORTS
 589-1   Sec. 1508.001.  AUTHORITY FOR PARKS, RECREATIONAL
 589-2                     FACILITIES, AND AIRPORTS
 589-3   Sec. 1508.002.  AUTHORITY TO ISSUE BONDS, NOTES, AND WARRANTS
 589-4   Sec. 1508.003.  PLEDGE OF INCOME
 589-5   Sec. 1508.004.  AUTHORITY TO GRANT FRANCHISE
 589-6   Sec. 1508.005.  OBLIGATIONS NOT DEBT OF MUNICIPALITY
 589-7   Sec. 1508.006.  ELECTION
 589-8   Sec. 1508.007.  RECORDS
 589-9   Sec. 1508.008.  ANNUAL REPORT
589-10   Sec. 1508.009.  OFFENSE
589-11   Sec. 1508.010.  CIVIL ENFORCEMENT
589-12           (Sections 1508.011-1508.050 reserved for expansion)
589-13             SUBCHAPTER B.  REVENUE BONDS FOR SWIMMING POOLS
589-14   Sec. 1508.051.  AUTHORITY FOR SWIMMING POOLS
589-15   Sec. 1508.052.  AUTHORITY TO ISSUE REVENUE BONDS
589-16   Sec. 1508.053.  ISSUANCE OF BONDS
589-17   Sec. 1508.054.  BONDS NOT DEBT OF MUNICIPALITY
589-18   Sec. 1508.055.  EFFECT ON OTHER LAW
589-19           (Sections 1508.056-1508.100 reserved for expansion)
589-20         SUBCHAPTER C.  OBLIGATIONS FOR HEALTH AND RECREATIONAL
589-21     FACILITIES IN MUNICIPALITIES WITH POPULATION OF 230,000 OR MORE
589-22   Sec. 1508.101.  APPLICABILITY OF SUBCHAPTER
589-23   Sec. 1508.102.  AUTHORITY FOR CERTAIN HEALTH OR
589-24                     RECREATIONAL FACILITIES
589-25   Sec. 1508.103.  AUTHORITY TO ISSUE BONDS, NOTES, AND
589-26                     WARRANTS
589-27   Sec. 1508.104.  PLEDGE OF INCOME
 590-1   Sec. 1508.105.  MORTGAGE
 590-2   Sec. 1508.106.  OBLIGATION NOT PAYABLE FROM TAXES
 590-3   Sec. 1508.107.  APPLICATION OF OTHER LAW
 590-4   Sec. 1508.108.  OPERATING EXPENSES AS FIRST LIEN
 590-5   Sec. 1508.109.  RENTS AND CONCESSION CHARGES
 590-6   Sec. 1508.110.  USE OF INCOME FOR OTHER PURPOSE
 590-7                     PROHIBITED
 590-8   Sec. 1508.111.  MANAGEMENT AND CONTROL
 590-9   Sec. 1508.112.  APPOINTMENT OF TRUSTEE; ATTORNEY'S FEES
590-10   Sec. 1508.113.  NOTICE TO GOVERNING BODY BEFORE
590-11                     FORECLOSURE OR OTHER ACTION
590-12           (Sections 1508.114-1508.150 reserved for expansion)
590-13       SUBCHAPTER D.  BONDS FOR PARKS AND RECREATIONAL FACILITIES
590-14        IN MUNICIPALITIES WITH POPULATION OF 1.2 MILLION OR MORE
590-15   Sec. 1508.151.  APPLICABILITY OF SUBCHAPTER
590-16   Sec. 1508.152.  AUTHORITY FOR PARK FACILITIES
590-17   Sec. 1508.153.  AUTHORITY TO ISSUE REVENUE BONDS
590-18   Sec. 1508.154.  PLEDGE OF REVENUE
590-19   Sec. 1508.155.  ADDITIONAL SECURITY
590-20   Sec. 1508.156.  MATURITY
590-21   Sec. 1508.157.  ADDITIONAL BONDS
590-22   Sec. 1508.158.  SALE OF BONDS
590-23   Sec. 1508.159.  REVIEW AND APPROVAL OF CONTRACTS BY ATTORNEY
590-24                     GENERAL
590-25   Sec. 1508.160.  CHARGES
590-26   Sec. 1508.161.  USE OF AD VALOREM TAXES
590-27   Sec. 1508.162.  REFUNDING BONDS
 591-1   Sec. 1508.163.  PUBLIC PURPOSE
 591-2   Sec. 1508.164.  CONFLICT WITH OTHER LAW
 591-3           (Sections 1508.165-1508.200 reserved for expansion)
 591-4             SUBCHAPTER E.  CERTIFICATES OF INDEBTEDNESS FOR
 591-5                      SEA LIFE PARK AND OCEANARIUM
 591-6   Sec. 1508.201.  APPLICABILITY OF SUBCHAPTER
 591-7   Sec. 1508.202.  AUTHORITY TO ISSUE CERTIFICATES OF
 591-8                     INDEBTEDNESS
 591-9   Sec. 1508.203.  SECURITY FOR CERTIFICATES
591-10   Sec. 1508.204.  SALE OR DELIVERY OF CERTIFICATES
591-11   Sec. 1508.205.  AUTHORITY TO ENTER INTO AGREEMENT
591-12                     REGARDING PUBLIC FACILITIES
591-13   Sec. 1508.206.  ACQUISITION OF PUBLIC FACILITY FROM
591-14                     OPERATOR
591-15   Sec. 1508.207.  DISCONTINUATION OF SEA LIFE PARK AND
591-16                     OCEANARIUM; SALE OR LEASE OF SURPLUS
591-17                     PROPERTY
591-18   Sec. 1508.208.  CONFLICT WITH OTHER LAW
591-19             CHAPTER 1508.  OBLIGATIONS FOR MUNICIPAL PARKS,
591-20                  RECREATIONAL FACILITIES, AND AIRPORTS
591-21     SUBCHAPTER A.  OBLIGATIONS FOR PARKS, RECREATIONAL FACILITIES,
591-22                              AND AIRPORTS
591-23         Sec. 1508.001.  AUTHORITY FOR PARKS, RECREATIONAL FACILITIES,
591-24   AND AIRPORTS.  (a)  A municipality may:
591-25               (1)  construct, purchase, or encumber:
591-26                     (A)  a park, swimming pool, golf course, golf
591-27   course clubhouse, or ballpark;
 592-1                     (B)  a fairground or an exposition building;
 592-2                     (C)  an airport; or
 592-3                     (D)  land on which a facility described by
 592-4   Paragraphs (A)-(C) is located; or
 592-5               (2)  encumber anything acquired or to be acquired that
 592-6   relates to a facility or land constructed or purchased under
 592-7   Subdivision (1).
 592-8         (b)  A municipality may secure the payment of funds to
 592-9   construct, purchase, or equip a facility or land described by
592-10   Subsection (a)(1).  (V.A.C.S. Art. 1015c, Sec. 1 (part).)
592-11         Sec. 1508.002.  AUTHORITY TO ISSUE BONDS, NOTES, AND
592-12   WARRANTS.  A municipality may issue bonds, notes, or warrants to
592-13   provide the money to construct or purchase a facility or land
592-14   described by Section 1508.001.  (V.A.C.S.  Art. 1015c, Sec. 1
592-15   (part).)
592-16         Sec. 1508.003.  PLEDGE OF INCOME.  A municipality may pledge
592-17   the income from a facility or land described by Section 1508.001 to
592-18   the payment of obligations issued under this subchapter.  (V.A.C.S.
592-19   Art. 1015c, Sec. 1 (part).)
592-20         Sec. 1508.004.  AUTHORITY TO GRANT FRANCHISE.  As additional
592-21   security for an obligation described by Section 1508.002, a
592-22   municipality may, under the terms of the encumbrance, grant to the
592-23   purchaser under sale or foreclosure a franchise to operate the
592-24   facility or land for a term not to exceed 20 years from the date of
592-25   purchase, subject to all laws regulating same then in force.
592-26   (V.A.C.S. Art. 1015c, Sec. 1 (part).)
592-27         Sec. 1508.005.  OBLIGATIONS NOT DEBT OF MUNICIPALITY.  An
 593-1   obligation issued under this subchapter:
 593-2               (1)  is not a debt of the municipality;
 593-3               (2)  may be a charge only on the facility or land
 593-4   pledged for the payment of the obligation; and
 593-5               (3)  may not be included in determining the power of
 593-6   the municipality to issue bonds for any purpose authorized by law.
 593-7   (V.A.C.S.  Art. 1015c, Sec. 1 (part).)
 593-8         Sec. 1508.006.  ELECTION.  (a)  Unless authorized at an
 593-9   election by a majority vote of the qualified voters of the
593-10   municipality, a municipality may not:
593-11               (1)  encumber a facility or land described by Section
593-12   1508.001 for more than $5,000 except:
593-13                     (A)  for purchase money;
593-14                     (B)  for funds to construct and equip the
593-15   facility; or
593-16                     (C)  to refund existing debt that was authorized
593-17   by law; or
593-18               (2)  sell a facility or land described by Section
593-19   1508.001.
593-20         (b)  The governing body of the municipality shall hold an
593-21   election under this section in the manner provided for other bond
593-22   elections in the municipality.
593-23         (c)  If approved by a majority vote of the qualified voters
593-24   at an election held for that purpose before November 14, 1935, an
593-25   election is not required to encumber:
593-26               (1)  a golf course or golf course clubhouse;
593-27               (2)  a fairground or an exposition building;
 594-1               (3)  an airport; or
 594-2               (4)  land for a facility described by Subdivisions
 594-3   (1)-(3).  (V.A.C.S.  Art. 1015c, Sec. 2.)
 594-4         Sec. 1508.007.  RECORDS.  The mayor of a municipality that
 594-5   has a facility or land described by Section 1508.001 shall
 594-6   establish and maintain a complete system of records that:
 594-7               (1)  show each free service provided in connection with
 594-8   the facility or land and the value of the service; and
 594-9               (2)  show separately the amounts spent and amounts set
594-10   aside for operation, salaries, labor, materials, repairs,
594-11   maintenance, depreciation, replacements, extensions, interest, and
594-12   the creation of a sinking fund to pay the bonds or debt.  (V.A.C.S.
594-13   Art. 1015c, Sec. 4 (part).)
594-14         Sec. 1508.008.  ANNUAL REPORT.  (a)  Not later than February
594-15   1 of each year, the superintendent or manager of a facility or land
594-16   described by Section 1508.001 shall file with the mayor of the
594-17   municipality a detailed report of the operation of the facility or
594-18   land for the year ending the preceding January 1.
594-19         (b)  The report must show the total amount of money collected
594-20   and the balance due, and the total disbursements made and the
594-21   amounts remaining unpaid, resulting from the operation of the
594-22   facility or land during that year.  (V.A.C.S. Art. 1015c, Sec. 4
594-23   (part).)
594-24         Sec. 1508.009.  OFFENSE.  (a)  A mayor commits an offense if
594-25   the mayor fails to:
594-26               (1)  establish the system of records required by
594-27   Section 1508.007 before the 91st day after the date the
 595-1   construction or purchase of the facility or land is completed; or
 595-2               (2)  maintain the system of records required by Section
 595-3   1508.007.
 595-4         (b)  A superintendent or manager of a facility or land
 595-5   described by Section 1508.001 commits an offense if the
 595-6   superintendent or manager fails to file a report required by
 595-7   Section 1508.008.
 595-8         (c)  An offense under this section is a misdemeanor
 595-9   punishable by a fine of not less than $100 or more than $1,000.
595-10   (V.A.C.S.  Art. 1015c, Sec. 4 (part).)
595-11         Sec. 1508.010.  CIVIL ENFORCEMENT.  A taxpayer who resides in
595-12   the municipality or a holder of an obligation issued under this
595-13   subchapter and secured by the encumbered revenue from a facility or
595-14   land described by Section 1508.001 is entitled to enforce this
595-15   subchapter by appropriate civil action in a district court in the
595-16   county in which the municipality is located.  (V.A.C.S. Art. 1015c,
595-17   Sec. 4 (part).)
595-18           (Sections 1508.011-1508.050 reserved for expansion)
595-19             SUBCHAPTER B.  REVENUE BONDS FOR SWIMMING POOLS
595-20         Sec. 1508.051.  AUTHORITY FOR SWIMMING POOLS.  A municipality
595-21   may:
595-22               (1)  purchase, construct, improve, enlarge, or repair a
595-23   municipal swimming pool; or
595-24               (2)  encumber:
595-25                     (A)  a municipal swimming pool or anything
595-26   acquired that relates to the pool; or
595-27                     (B)  the gross income and revenue from a
 596-1   municipal pool.  (V.A.C.S. Art. 1015c-2, Sec. 1 (part).)
 596-2         Sec. 1508.052.  AUTHORITY TO ISSUE REVENUE BONDS.  A
 596-3   municipality may issue revenue bonds to purchase, construct,
 596-4   improve, enlarge, or repair a municipal swimming pool.  (V.A.C.S.
 596-5   Art. 1015c-2, Sec. 1 (part).)
 596-6         Sec. 1508.053.  ISSUANCE OF BONDS.  Except as provided by
 596-7   this subchapter, a municipality shall issue bonds for a purpose
 596-8   described by Section 1508.052, including additional bonds and
 596-9   refunding bonds, in the manner provided by Subchapter B, Chapter
596-10   1502.  (V.A.C.S. Art. 1015c-2, Sec. 2.)
596-11         Sec. 1508.054.  BONDS NOT DEBT OF MUNICIPALITY.  A bond
596-12   issued under this subchapter:
596-13               (1)  is not a debt of the municipality;
596-14               (2)  may be a charge only on the property or income
596-15   pledged for the payment of the bond; and
596-16               (3)  may not be included in determining the power of
596-17   the municipality to issue bonds for any other purpose authorized by
596-18   law.  (V.A.C.S. Art. 1015c-2, Sec. 1 (part).)
596-19         Sec. 1508.055.  EFFECT ON OTHER LAW.  This subchapter does
596-20   not affect any other law relating to the issuance of revenue bonds
596-21   by a municipality, including Subchapter B, Chapter 1502.  (V.A.C.S.
596-22   Art. 1015c-2, Sec. 5 (part).)
596-23           (Sections 1508.056-1508.100 reserved for expansion)
596-24         SUBCHAPTER C.  OBLIGATIONS FOR HEALTH AND RECREATIONAL
596-25     FACILITIES IN MUNICIPALITIES WITH POPULATION OF 230,000 OR MORE
596-26         Sec. 1508.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
596-27   applies only to a municipality with a population of 230,000 or
 597-1   more.  (V.A.C.S. Art. 1180b, Sec. 1 (part).)
 597-2         Sec. 1508.102.  AUTHORITY FOR CERTAIN HEALTH OR RECREATIONAL
 597-3   FACILITIES.  (a)  A municipality may acquire, encumber, construct,
 597-4   maintain, operate, repair, or remodel:
 597-5               (1)  a health and recreational facility, park,
 597-6   playground, hotel, bathhouse, or swimming pool or facility; or
 597-7               (2)  an installation or establishment necessary or
 597-8   desirable as a part of a facility described by Subdivision (1).
 597-9         (b)  A municipality may not encumber under this section a
597-10   project acquired on or before November 14, 1935.  (V.A.C.S.
597-11   Art. 1180b, Sec. 1 (part).)
597-12         Sec. 1508.103.  AUTHORITY TO ISSUE BONDS, NOTES, AND
597-13   WARRANTS.  A municipality may issue bonds, notes, or warrants to
597-14   provide money for an acquisition or an activity authorized by
597-15   Section 1508.102.  (V.A.C.S.  Art. 1180b, Sec. 1 (part).)
597-16         Sec. 1508.104.  PLEDGE OF INCOME.  A municipality may pledge
597-17   the income from a project described by Section 1508.102 to the
597-18   payment of an obligation issued under this subchapter.  (V.A.C.S.
597-19   Art. 1180b, Sec. 1 (part).)
597-20         Sec. 1508.105.  MORTGAGE.  A municipality may secure the
597-21   payment of funds for a purchase under this subchapter with an
597-22   instrument of pledge or mortgage as desired by the municipality.
597-23   (V.A.C.S.  Art. 1180b, Sec. 1 (part).)
597-24         Sec. 1508.106.  OBLIGATION NOT PAYABLE FROM TAXES.  (a)  An
597-25   obligation issued under this subchapter:
597-26               (1)  is not a debt of the municipality;
597-27               (2)  may be a charge only on the property and revenue
 598-1   encumbered; and
 598-2               (3)  may not be included in determining the power of
 598-3   the municipality to issue bonds for any purpose authorized by law.
 598-4         (b)  A contract, bond, warrant, or note issued or executed
 598-5   under this subchapter must contain the following provision: "The
 598-6   holder of this obligation is not entitled to demand payment of this
 598-7   obligation out of any money raised by taxation."  (V.A.C.S.
 598-8   Art. 1180b, Secs. 1 (part), 4.)
 598-9         Sec. 1508.107.  APPLICATION OF OTHER LAW.  The provisions of
598-10   Chapter 252, Local Government Code, regarding notice, competitive
598-11   bids, and the right to referendum do not apply to a municipality
598-12   issuing revenue bonds under this subchapter.  (V.A.C.S. Art. 1180b,
598-13   Sec. 2.)
598-14         Sec. 1508.108.  OPERATING EXPENSES AS FIRST LIEN.  If the
598-15   income from a project described by Section 1508.102 is encumbered
598-16   under this subchapter, each expense of operation and maintenance of
598-17   the project, including all salaries, labor, materials, interest,
598-18   repairs, and extensions necessary to maintain the project, and each
598-19   proper item of expense, is a first lien and charge against the
598-20   income.  (V.A.C.S. Art. 1180b, Sec. 3 (part).)
598-21         Sec. 1508.109.  RENTS AND CONCESSION CHARGES.  (a)  The
598-22   governing body that manages and controls a project under Section
598-23   1508.111 shall impose and collect rents and concession charges for
598-24   the use of the project in an amount sufficient to pay:
598-25               (1)  all operating and maintenance expenses,
598-26   depreciation, replacements, salaries, and interest charges;
598-27               (2)  for an interest and sinking fund sufficient to pay
 599-1   any bonds issued to purchase, construct, maintain, or improve the
 599-2   project; and
 599-3               (3)  any outstanding debt against the project.
 599-4         (b)  The governing body may not allow any free use of or free
 599-5   service in connection with the project.
 599-6         (c)  The charges imposed under Subsection (a) must comply
 599-7   with the requirements of any governmental agency lending or
 599-8   providing funds for the project.  (V.A.C.S. Art. 1180b, Sec. 3
 599-9   (part).)
599-10         Sec. 1508.110.  USE OF INCOME FOR OTHER PURPOSE PROHIBITED.
599-11   A municipality may not use the income from a project described by
599-12   Section 1508.102 to pay another debt, expense, or obligation of the
599-13   municipality until the debt secured by the income is fully paid.
599-14   (V.A.C.S. Art. 1180b, Sec. 8.)
599-15         Sec. 1508.111.  MANAGEMENT AND CONTROL.  (a)  The contract
599-16   under which a project authorized by Section 1508.102 is encumbered
599-17   must provide for the placement of the management and control of the
599-18   project during the time the project is encumbered in:
599-19               (1)  the governing body of the municipality; or
599-20               (2)  another governing body established for that
599-21   purpose by the governing body of the municipality.
599-22         (b)  The governing body that manages and controls a project
599-23   under Subsection (a) may:
599-24               (1)  adopt rules governing the use and rental of the
599-25   project and for the payment of rents and concession charges; and
599-26               (2)  provide penalties for:
599-27                     (A)  the violation of rules adopted under
 600-1   Subdivision (1);
 600-2                     (B)  the use of the project without the consent
 600-3   or knowledge of the authorities in charge of the project; or
 600-4                     (C)  any interference with, trespass on, or
 600-5   injury to the project or the property on which the project is
 600-6   located.  (V.A.C.S. Art. 1180b, Sec. 5.)
 600-7         Sec. 1508.112.  APPOINTMENT OF TRUSTEE; ATTORNEY'S FEES.  A
 600-8   contract under which a project is encumbered under this subchapter
 600-9   may provide for:
600-10               (1)  the selection of a trustee to sell the project on:
600-11                     (A)  a default in the payment of principal or
600-12   interest; or
600-13                     (B)  a violation of the terms of the encumbrance;
600-14               (2)  the selection of a successor trustee if the
600-15   original trustee or a substitute trustee is disqualified or fails
600-16   to act; and
600-17               (3)  attorney's fees in an amount not to exceed 10
600-18   percent of the unpaid principal. (V.A.C.S. Art. 1180b, Sec. 6.)
600-19         Sec. 1508.113.  NOTICE TO GOVERNING BODY BEFORE FORECLOSURE
600-20   OR OTHER ACTION.  (a)  Unless written notice is given to the
600-21   governing body of the municipality in accordance with this section
600-22   that there is a default in payment of any installment of principal
600-23   of or interest on an obligation issued under this subchapter or
600-24   another violation of the terms of the pledge or loan:
600-25               (1)  a collection fee may not accrue;
600-26               (2)  a foreclosure proceeding may not be initiated in a
600-27   court or through a trustee; and
 601-1               (3)  an option to mature any part of an obligation
 601-2   because of the default may not be exercised.
 601-3         (b)  A notice under Subsection (a)  must be sent by prepaid
 601-4   registered mail to each member of the governing body of the
 601-5   municipality, addressed to the member at the post office in the
 601-6   municipality.
 601-7         (c)  An action described by Subsection (a) may not be taken:
 601-8               (1)  before the 91st day after the date the notice is
 601-9   mailed; or
601-10               (2)  if the default that gave rise to the action is
601-11   cured within the time described by Subdivision (1).  (V.A.C.S.
601-12   Art. 1180b, Sec. 7.)
601-13           (Sections 1508.114-1508.150 reserved for expansion)
601-14       SUBCHAPTER D.  BONDS FOR PARKS AND RECREATIONAL FACILITIES
601-15        IN MUNICIPALITIES WITH POPULATION OF 1.2 MILLION OR MORE
601-16         Sec. 1508.151.  APPLICABILITY OF SUBCHAPTER.  This subchapter
601-17   applies only to a municipality with a population of 1.2 million or
601-18   more.  (V.A.C.S. Art. 1269j-4.15, Sec. 1.)
601-19         Sec. 1508.152.  AUTHORITY FOR PARK FACILITIES.  (a)  A
601-20   municipality may acquire by any means or construct, improve, or
601-21   equip property for park purposes, including establishing,
601-22   acquiring, leasing or contracting for as lessee or lessor,
601-23   constructing, improving, enlarging, equipping, maintaining,
601-24   repairing, or operating:
601-25               (1)  a golf course, clubhouse, or pro shop;
601-26               (2)  a tennis court or facility;
601-27               (3)  a swimming pool;
 602-1               (4)  a marina;
 602-2               (5)  a recreation center;
 602-3               (6)  a rugby field;
 602-4               (7)  a baseball field;
 602-5               (8)  a zoo;
 602-6               (9)  a clarification lake or pool;
 602-7               (10)  a park transportation system or equipment;
 602-8               (11)  a theater;
 602-9               (12)  a bicycle trail;
602-10               (13)  a multipurpose shelter;
602-11               (14)  a service facility;
602-12               (15)  a recreational facility;
602-13               (16)  a water, sewer, or drainage facility necessary
602-14   for a facility described by Subdivisions (1)-(15); or
602-15               (17)  a structure, area, or facility to be used in
602-16   connection with a facility described by Subdivisions (1)-(15) for
602-17   parking and storage of motor vehicles or other conveyances.
602-18         (b)  A municipality may enter into an agreement under which a
602-19   facility described by Subsection (a)  is operated on behalf of the
602-20   municipality.  (V.A.C.S. Art. 1269j-4.15, Sec. 2 (part).)
602-21         Sec. 1508.153.  AUTHORITY TO ISSUE REVENUE BONDS.  The
602-22   governing body of a municipality by ordinance may issue revenue
602-23   bonds for a purpose authorized by Section 1508.152.  (V.A.C.S.
602-24   Art. 1269j-4.15, Secs. 3 (part), 4(a) (part).)
602-25         Sec. 1508.154.  PLEDGE OF REVENUE.  A municipality may pledge
602-26   all or part of the revenue, income, or receipts from a facility
602-27   described by Section 1508.152(a) to the payment of bonds, including
 603-1   principal, interest, and any other amounts required or permitted in
 603-2   connection with the bonds.  (V.A.C.S. Art. 1269j-4.15, Secs. 3
 603-3   (part), 6(a) (part).)
 603-4         Sec. 1508.155.  ADDITIONAL SECURITY.  (a)  The bonds may be
 603-5   additionally secured by:
 603-6               (1)  an encumbrance on any real property relating to a
 603-7   facility described by Section 1508.152(a) owned or to be acquired
 603-8   by the municipality; or
 603-9               (2)  an encumbrance on any personal property
603-10   appurtenant to that real property.
603-11         (b)  The governing body of the municipality may authorize the
603-12   execution of a trust indenture, mortgage, deed of trust, or other
603-13   form of encumbrance as evidence of the debt.
603-14         (c)  The municipality may also pledge to the payment of the
603-15   bonds all or part of any grant, donation, revenue, or income
603-16   received or to be received from the United States or any other
603-17   public or private source.  (V.A.C.S. Art. 1269j-4.15, Secs. 6(b),
603-18   (c).)
603-19         Sec. 1508.156.  MATURITY.  A bond issued under this
603-20   subchapter must mature not later than 40 years after its date.
603-21   (V.A.C.S.  Art. 1269j-4.15, Sec. 4(a) (part).)
603-22         Sec. 1508.157.  ADDITIONAL BONDS.  The ordinance that
603-23   authorizes the issuance of bonds under this subchapter may provide
603-24   for the issuance of additional parity bonds or subordinate lien
603-25   bonds under the terms specified in the ordinance.  (V.A.C.S.
603-26   Art. 1269j-4.15, Sec. 4(a) (part).)
603-27         Sec. 1508.158.  SALE OF BONDS.  A municipality may sell bonds
 604-1   issued under this subchapter in the manner and under the terms
 604-2   provided in the ordinance authorizing the issuance of the bonds.
 604-3   (V.A.C.S. Art. 1269j-4.15, Sec. 4(b) (part).)
 604-4         Sec. 1508.159.  REVIEW AND APPROVAL OF CONTRACTS BY ATTORNEY
 604-5   GENERAL.  (a)  If the bonds state that they are secured by a pledge
 604-6   of revenue or rents from a contract, including a lease contract, a
 604-7   copy of the contract and the proceedings relating to it must also
 604-8   be submitted to the attorney general.
 604-9         (b)  If the attorney general finds that the bonds have been
604-10   authorized and the contract has been made in accordance with law,
604-11   the attorney general shall approve the contract.
604-12         (c)  After the bonds are approved and registered under
604-13   Chapter 1202 and the contract is approved under Subsection (b), the
604-14   contract is incontestable for any reason and is a binding
604-15   obligation for all purposes in accordance with its terms.
604-16   (V.A.C.S. Art. 1269j-4.15, Sec. 8 (part).)
604-17         Sec. 1508.160.  CHARGES.  (a)  The governing body of a
604-18   municipality may impose and collect charges for the use of a
604-19   facility described by Section 1508.152(a).
604-20         (b)  A municipality shall impose and collect charges in an
604-21   amount that will be at least sufficient, with any other pledged
604-22   resources, to provide for the payment of:
604-23               (1)  the principal of, interest on, and any other
604-24   amounts required in connection with the bonds; and
604-25               (2)  to the extent required by the ordinance
604-26   authorizing the issuance of the bonds:
604-27                     (A)  expenses incurred in connection with the
 605-1   bonds; and
 605-2                     (B)  operation, maintenance, and other expenses
 605-3   incurred in connection with the facility.  (V.A.C.S.
 605-4   Art. 1269j-4.15, Secs. 5, 6(a) (part).)
 605-5         Sec. 1508.161.  USE OF AD VALOREM TAXES.  (a)  In addition to
 605-6   or instead of a pledge of revenue, a municipality may impose and
 605-7   pledge to the payment of any portion of the operation and
 605-8   maintenance costs of a facility described by Section 1508.152(a) a
 605-9   continuing annual ad valorem tax imposed at a rate sufficient for
605-10   that purpose as provided in the ordinance authorizing the issuance
605-11   of bonds under this subchapter.
605-12         (b)  A tax under this section:
605-13               (1)  must be imposed at a rate within any limit
605-14   contained in the municipal charter; and
605-15               (2)  may not be used for the payment of the principal
605-16   of or interest on the bonds.
605-17         (c)  The proceeds of a tax pledged under this section shall
605-18   be used annually, to the extent required by or provided in the
605-19   ordinance authorizing the issuance of the bonds, for the operation
605-20   and maintenance of the facility.  (V.A.C.S.  Art. 1269j-4.15, Sec.
605-21   4(d).)
605-22         Sec. 1508.162.  REFUNDING BONDS.  (a)  A municipality may
605-23   refund or otherwise refinance bonds issued under this subchapter by
605-24   issuing refunding bonds under any terms provided by the ordinance
605-25   authorizing the issuance of the bonds.  All appropriate provisions
605-26   of this subchapter apply to the refunding bonds.  The refunding
605-27   bonds shall be issued in the manner provided by this subchapter for
 606-1   other bonds.
 606-2         (b)  The refunding bonds may be sold and delivered in amounts
 606-3   necessary to pay the principal of and interest and any redemption
 606-4   premium on the bonds to be refunded, at maturity or on any
 606-5   redemption date.
 606-6         (c)  The refunding bonds may be issued to be exchanged for
 606-7   the bonds being refunded by them.  In that case, the comptroller
 606-8   shall register the refunding bonds and deliver them to the holder
 606-9   of the bonds being refunded as provided by the ordinance
606-10   authorizing the issuance of the bonds.  The exchange may be made in
606-11   one delivery or in installment deliveries.  (V.A.C.S.
606-12   Art. 1269j-4.15, Secs. 7(a), (b).)
606-13         Sec. 1508.163.  PUBLIC PURPOSE.  Each purpose authorized by
606-14   Section 1508.152 is a public purpose and a proper municipal
606-15   function.  (V.A.C.S. Art. 1269j-4.15, Sec. 2 (part).)
606-16         Sec. 1508.164.  CONFLICT WITH OTHER LAW.  When bonds are
606-17   issued under this subchapter, to the extent of any conflict between
606-18   this subchapter and another law or a charter provision of a
606-19   home-rule municipality, this subchapter controls.  (V.A.C.S.
606-20   Art. 1269j-4.15, Sec. 10 (part).)
606-21           (Sections 1508.165-1508.200 reserved for expansion)
606-22             SUBCHAPTER E.  CERTIFICATES OF INDEBTEDNESS FOR
606-23                      SEA LIFE PARK AND OCEANARIUM
606-24         Sec. 1508.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
606-25   applies only to a municipality that owns a sea life park and
606-26   oceanarium for which any portion of the costs of construction,
606-27   equipment, or development is paid from the proceeds of general
 607-1   obligation park bonds authorized by an election held in the
 607-2   municipality.  (V.A.C.S.  Art. 1269j-4.4, Sec. 1 (part).)
 607-3         Sec. 1508.202.  AUTHORITY TO ISSUE CERTIFICATES OF
 607-4   INDEBTEDNESS.  (a)  The governing body of a municipality by
 607-5   ordinance may issue certificates of indebtedness to obtain money
 607-6   to:
 607-7               (1)  operate, maintain, repair, develop, or expand the
 607-8   sea life park and oceanarium;
 607-9               (2)  acquire equipment and inventories for the sea life
607-10   park and oceanarium;
607-11               (3)  pay for services when performed, or for items when
607-12   acquired, for the benefit of the municipality under an agreement
607-13   relating to the development, operation, equipping, staffing, or
607-14   maintenance of the sea life park and oceanarium, including a lease,
607-15   use, purchase, concession, or operating agreement; or
607-16               (4)  acquire a facility, asset, or right from an
607-17   operator under Section 1508.206.
607-18         (b)  A municipality may issue certificates of indebtedness
607-19   for a purpose described by Subsections (a)(1)-(3) in connection
607-20   with another public facility:
607-21               (1)  owned by the municipality in conjunction with the
607-22   sea life park and oceanarium; and
607-23               (2)  authorized under Subchapter B, Chapter 305, Local
607-24   Government Code, or Subchapter A, Chapter 1504.  (V.A.C.S.
607-25   Art. 1269j-4.4, Secs. 1 (part), 1(a) (part), 2 (part).)
607-26         Sec. 1508.203.  SECURITY FOR CERTIFICATES.  (a)  Certificates
607-27   of indebtedness issued under this subchapter may be secured by and
 608-1   made payable from:
 608-2               (1)  taxes;
 608-3               (2)  revenue; or
 608-4               (3)  both taxes and revenue.
 608-5         (b)  To secure the repayment of certificates of indebtedness
 608-6   issued under this subchapter or bonds issued to refund certificates
 608-7   of indebtedness issued under this subchapter, the governing body of
 608-8   a municipality may:
 608-9               (1)  pledge any portion of the revenue from the
608-10   ownership or operation of any facility, asset, or right under this
608-11   subchapter; or
608-12               (2)  execute a deed of trust or mortgage lien on any
608-13   portion of a facility described by Section 1508.202.  (V.A.C.S.
608-14   Art. 1269j-4.4, Secs. 2 (part), 2(a) (part).)
608-15         Sec. 1508.204.  SALE OR DELIVERY OF CERTIFICATES.  The
608-16   ordinance authorizing the issuance of certificates of indebtedness
608-17   under this subchapter may include provisions for any manner of:
608-18               (1)  sale of the certificates;
608-19               (2)  exchange of the certificates for property or
608-20   services; or
608-21               (3)  delivery of the certificates.  (V.A.C.S.
608-22   Art. 1269j-4.4, Sec. 2 (part).)
608-23         Sec. 1508.205.  AUTHORITY TO ENTER INTO AGREEMENT REGARDING
608-24   PUBLIC FACILITIES.  (a)  The governing body of a municipality may
608-25   enter into an agreement relating to the operation, maintenance,
608-26   development, expansion, equipment, or supplying of a public
608-27   facility described by Section 1508.202.
 609-1         (b)  An agreement authorized by Subsection (a) may be entered
 609-2   into only:
 609-3               (1)  on the issuance of certificates of indebtedness
 609-4   under this subchapter; or
 609-5               (2)  in anticipation of:
 609-6                     (A)  the issuance of certificates of indebtedness
 609-7   under this subchapter; or
 609-8                     (B)  the receipt of revenue from a public
 609-9   facility instead of the issuance of certificates of indebtedness.
609-10         (c)  The agreement may be of a type, on the terms, and
609-11   entered into under procedures that the governing body determines
609-12   best, necessary, and proper.
609-13         (d)  The proceeds from the certificates of indebtedness, or
609-14   the revenue received instead of issuing certificates, may be used
609-15   to satisfy an agreement under this section.  (V.A.C.S.
609-16   Art. 1269j-4.4, Sec. 6.)
609-17         Sec. 1508.206.  ACQUISITION OF PUBLIC FACILITY FROM OPERATOR.
609-18   (a)  A municipality may acquire any portion of a public facility
609-19   described by Section 1508.202, or an asset or right related to the
609-20   facility, including broadcasting or similar rights, from a person
609-21   or corporation that operates any portion of the facility on behalf
609-22   of the municipality under an agreement, including a lease, use,
609-23   purchase, concession, or operating agreement, if:
609-24               (1)  the governing body of the municipality determines
609-25   that the facility could be better and more efficiently operated
609-26   directly by the municipality or through another method; and
609-27               (2)  the person or corporation consents to the
 610-1   acquisition.
 610-2         (b)  The method used by the municipality to operate the
 610-3   facility may include the use of an operating board appointed by the
 610-4   governing body, with the board's powers granted by ordinance or
 610-5   another method.
 610-6         (c)  A facility, asset, or right acquired under this section
 610-7   may be used or sold by the municipality. In conjunction with the
 610-8   use or sale, the municipality may promote or advertise:
 610-9               (1)  the municipality;
610-10               (2)  the facility; or
610-11               (3)  an event conducted in or in connection with the
610-12   facility.  (V.A.C.S. Art. 1269j-4.4, Sec. 1(a) (part).)
610-13         Sec. 1508.207.  DISCONTINUATION OF SEA LIFE PARK AND
610-14   OCEANARIUM; SALE OR LEASE OF SURPLUS PROPERTY.  (a)  The governing
610-15   body of a municipality by ordinance may abandon the use of property
610-16   for a sea life park and oceanarium and sell or lease the property
610-17   for any purpose the governing body determines is appropriate and in
610-18   the interest of the residents of the municipality if:
610-19               (1)  the property was partly or wholly financed under
610-20   this subchapter; and
610-21               (2)  the governing body finds that use of the property
610-22   as a sea life park and oceanarium should be abandoned because:
610-23                     (A)  the sea life park and oceanarium is no
610-24   longer economically feasible; and
610-25                     (B)  the continued use of the property as a sea
610-26   life park and oceanarium would be unprofitable.
610-27         (b)  The municipality must sell property under this section
 611-1   only to the highest and best bidder as required for other property
 611-2   sold by the municipality.
 611-3         (c)  The municipality may lease property under this section
 611-4   for another purpose for a term and under such other provisions as
 611-5   agreed to by the governing body.
 611-6         (d)  The municipality shall apply rent received under a lease
 611-7   under Subsection (c) as required by any ordinance authorizing the
 611-8   issuance of certificates of indebtedness secured in whole or in
 611-9   part by revenue derived from the sea life park and oceanarium.
611-10   (V.A.C.S. Art. 1269j-4.4, Sec.  6a (part).)
611-11         Sec. 1508.208.  CONFLICT WITH OTHER LAW.  When any
611-12   certificates of indebtedness are being issued or any act or
611-13   contract is undertaken under this subchapter, to the extent of any
611-14   conflict between this subchapter and another law applicable to the
611-15   municipality, this subchapter controls.  (V.A.C.S. Art. 1269j-4.4,
611-16   Sec. 7 (part).)
611-17         CHAPTER 1509.  OBLIGATIONS FOR OTHER MUNICIPAL PURPOSES
611-18        SUBCHAPTER A.  BONDS FOR FACILITIES TO BE SOLD OR LEASED
611-19                      TO PUBLIC OR PRIVATE ENTITIES
611-20   Sec. 1509.001.  AUTHORITY TO ACQUIRE PROPERTY FOR LEASE
611-21                     TO PUBLIC OR PRIVATE ENTITY
611-22   Sec. 1509.002.  AUTHORITY TO ACQUIRE PROPERTY FOR SALE OR   
611-23                     LEASE TO INSTITUTION OF HIGHER EDUCATION
611-24   Sec. 1509.003.  AUTHORITY TO ISSUE BONDS
611-25   Sec. 1509.004.  BOND PAYMENTS FROM REVENUE OR TAXES
611-26   Sec. 1509.005.  ELECTION REQUIRED TO SECURE BONDS
611-27                     WITH TAX REVENUE
 612-1   Sec. 1509.006.  CONTENTS OF ORDINANCE, ORDER, OR RESOLUTION
 612-2                     AUTHORIZING BONDS
 612-3   Sec. 1509.007.  ADOPTION AND EXECUTION OF DOCUMENTS
 612-4   Sec. 1509.008.  MATURITY
 612-5   Sec. 1509.009.  IMPOSITION OF TAX
 612-6   Sec. 1509.010.  GRANTS FOR PRISONS OR LAW ENFORCEMENT
 612-7                     FACILITIES NOT PROHIBITED
 612-8           (Sections 1509.011-1509.050 reserved for expansion)
 612-9           SUBCHAPTER B.  BONDS FOR FIRE-FIGHTING EQUIPMENT IN
612-10            MUNICIPALITIES WITH POPULATION OF LESS THAN 5,000
612-11   Sec. 1509.051.  APPLICABILITY OF SUBCHAPTER
612-12   Sec. 1509.052.  AUTHORITY TO ISSUE BONDS
612-13           (Sections 1509.053-1509.100 reserved for expansion)
612-14              SUBCHAPTER C.  BONDS FOR FARMERS' MARKETS IN
612-15           MUNICIPALITIES WITH POPULATION OF MORE THAN 650,000
612-16   Sec. 1509.101.  APPLICABILITY OF SUBCHAPTER
612-17   Sec. 1509.102.  DEFINITION
612-18   Sec. 1509.103.  AUTHORITY FOR FARMERS' MARKET
612-19   Sec. 1509.104.  AUTHORITY TO ISSUE REVENUE BONDS
612-20   Sec. 1509.105.  PLEDGE OF REVENUE
612-21   Sec. 1509.106.  ADDITIONAL SECURITY
612-22   Sec. 1509.107.  MATURITY
612-23   Sec. 1509.108.  ADDITIONAL BONDS
612-24   Sec. 1509.109.  SALE OF BONDS
612-25   Sec. 1509.110.  REVIEW AND APPROVAL OF CONTRACTS RELATING
612-26                     TO BONDS
612-27   Sec. 1509.111.  CHARGES
 613-1   Sec. 1509.112.  REFUNDING BONDS
 613-2   Sec. 1509.113.  PUBLIC PURPOSE
 613-3   Sec. 1509.114.  CONFLICT WITH OTHER LAW
 613-4           (Sections 1509.115-1509.150 reserved for expansion)
 613-5          SUBCHAPTER D.  BONDS FOR GARBAGE RECLAMATION PROJECTS
 613-6   Sec. 1509.151.  DEFINITION
 613-7   Sec. 1509.152.  AUTHORITY FOR GARBAGE RECLAMATION
 613-8                     PROJECTS
 613-9   Sec. 1509.153.  AUTHORITY TO ISSUE BONDS
613-10   Sec. 1509.154.  BOND PAYMENTS FROM REVENUE OR TAXES
613-11   Sec. 1509.155.  ADDITIONAL SECURITY
613-12   Sec. 1509.156.  ELECTION
613-13   Sec. 1509.157.  BALLOT PROPOSITION
613-14   Sec. 1509.158.  CONTENTS OF ORDER OR RESOLUTION
613-15                     AUTHORIZING BONDS
613-16   Sec. 1509.159.  ADOPTION AND EXECUTION OF DOCUMENTS
613-17   Sec. 1509.160.  MATURITY
613-18   Sec. 1509.161.  IMPOSITION OF TAX
613-19   Sec. 1509.162.  REFUNDING BONDS
613-20   Sec. 1509.163.  EXEMPTION FROM TAXATION
613-21           (Sections 1509.164-1509.200 reserved for expansion)
613-22           SUBCHAPTER E.  BONDS FOR ACQUISITION OF PROPERTY BY
613-23           MUNICIPALITY OPERATING TOLL BRIDGE OVER RIO GRANDE
613-24   Sec. 1509.201.  APPLICABILITY OF SUBCHAPTER
613-25   Sec. 1509.202.  AUTHORITY FOR PROPERTY, FACILITY, OR
613-26                     ACTIVITY
613-27   Sec. 1509.203.  AUTHORITY TO ISSUE REVENUE BONDS
 614-1   Sec. 1509.204.  PLEDGE OF REVENUE
 614-2   Sec. 1509.205.  ADDITIONAL SECURITY
 614-3   Sec. 1509.206.  BONDS NOT PAYABLE FROM TAXES
 614-4   Sec. 1509.207.  MATURITY
 614-5   Sec. 1509.208.  ADDITIONAL BONDS
 614-6   Sec. 1509.209.  SALE OF BONDS
 614-7   Sec. 1509.210.  CHARGES
 614-8   Sec. 1509.211.  LEASE OR RENTAL OF PROPERTY OR FACILITY TO
 614-9                     UNITED STATES
614-10   Sec. 1509.212.  REFUNDING BONDS
614-11   Sec. 1509.213.  PUBLIC PURPOSE
614-12   Sec. 1509.214.  CONFLICT WITH OTHER LAW
614-13           (Sections 1509.215-1509.250 reserved for expansion)
614-14        SUBCHAPTER F.  ENCUMBRANCE OF SLAUGHTERHOUSES IN CERTAIN
614-15                         COASTAL MUNICIPALITIES
614-16   Sec. 1509.251.  APPLICABILITY OF SUBCHAPTER
614-17   Sec. 1509.252.  ENCUMBRANCE OF SLAUGHTERHOUSE
614-18   Sec. 1509.253.  OBLIGATIONS NOT DEBT OF MUNICIPALITY
614-19   Sec. 1509.254.  ELECTION NOT REQUIRED FOR CERTAIN
614-20                     OBLIGATIONS
614-21           (Sections 1509.255-1509.900 reserved for expansion)
614-22                 SUBCHAPTER Z.  MISCELLANEOUS PROVISIONS
614-23   Sec. 1509.901.  PLEDGE OF REVENUE FROM TOLL BRIDGE
614-24                     CONTRACT
614-25   Sec. 1509.902.  AUTHORITY TO ISSUE BONDS PAYABLE FROM TOLL
614-26                     BRIDGE REVENUE; PLEDGE OF TOLL BRIDGE
614-27                     REVENUE
 615-1         CHAPTER 1509.  OBLIGATIONS FOR OTHER MUNICIPAL PURPOSES
 615-2        SUBCHAPTER A.  BONDS FOR FACILITIES TO BE SOLD OR LEASED
 615-3                      TO PUBLIC OR PRIVATE ENTITIES
 615-4         Sec. 1509.001.  AUTHORITY TO ACQUIRE PROPERTY FOR LEASE TO
 615-5   PUBLIC OR PRIVATE ENTITY.  (a)  A municipality may acquire land and
 615-6   may construct or acquire a building or other facility for the
 615-7   purpose of leasing the land, building, or other facility to:
 615-8               (1)  a political subdivision or state agency for public
 615-9   use; or
615-10               (2)  an individual, private corporation, or other
615-11   private entity for use in manufacturing or another commercial
615-12   activity.
615-13         (b)  A municipality may not acquire land under Subsection (a)
615-14   by eminent domain. (V.A.C.S. Art. 835s, Sec. 2.)
615-15         Sec. 1509.002.  AUTHORITY TO ACQUIRE PROPERTY FOR SALE OR
615-16   LEASE TO INSTITUTION OF HIGHER EDUCATION.  (a)  In this section,
615-17   "institution of higher education" has the meaning assigned by
615-18   Section 61.003, Education Code.
615-19         (b)  This section applies only to a municipality that:
615-20               (1)  has a population of more than 8,000 but less than
615-21   10,000; and
615-22               (2)  is located in two counties with populations of
615-23   225,000 or more but less than 2,818,199.
615-24         (c)  A municipality may acquire land and may construct or
615-25   acquire a building or other facility for the purpose of selling or
615-26   leasing the land, building, or other facility to an institution of
615-27   higher education that will provide a significant number of
 616-1   vocational and vocational-technical education courses in the
 616-2   facility for public use.
 616-3         (d)  The municipality may sell or lease the property:
 616-4               (1)  without public notice or bidding; and
 616-5               (2)  on terms the governing body of the municipality
 616-6   finds acceptable.
 616-7         (e)  A municipality may not acquire land under this section
 616-8   by eminent domain.
 616-9         (f)  A sale under Subsection (c) may be by an installment
616-10   sale agreement or otherwise. (V.A.C.S. Art. 835s, Sec. 2A.)
616-11         Sec. 1509.003.  AUTHORITY TO ISSUE BONDS.  To develop and
616-12   diversify the economy of this state and eliminate unemployment or
616-13   underemployment in this state under the authority granted by
616-14   Section 52-a, Article III, Texas Constitution, a municipality may
616-15   issue and sell bonds to finance an action taken under Section
616-16   1509.001 or 1509.002.  (V.A.C.S.  Art. 835s, Secs. 1 (part), 3.)
616-17         Sec. 1509.004.  BOND PAYMENTS FROM REVENUE OR TAXES.  (a)  A
616-18   municipality may provide for payment of the principal of and
616-19   interest on bonds issued under this subchapter by:
616-20               (1)  pledging all or part of the revenue from the sale
616-21   or lease of all or part of the land, building, or other facility
616-22   financed by the bonds, after deduction of reasonable operation and
616-23   maintenance costs;
616-24               (2)  imposing an annual ad valorem tax; or
616-25               (3)  combining those sources.
616-26         (b)  A municipality with a population of 80,000 or more may
616-27   also provide for the payment of the principal of or interest on the
 617-1   bonds by pledging all or any part of other municipal revenue that
 617-2   is not prohibited from being used for that payment.  (V.A.C.S.
 617-3   Art. 835s, Sec. 4.)
 617-4         Sec. 1509.005.  ELECTION REQUIRED TO SECURE BONDS WITH TAX
 617-5   REVENUE.  Bonds to be issued under this subchapter that are payable
 617-6   in whole or in part from ad valorem taxes must be approved, before
 617-7   issuance, by a vote of a majority of the registered voters of the
 617-8   municipality voting on the issue.  (V.A.C.S. Art. 835s, Sec. 5(a).)
 617-9         Sec. 1509.006.  CONTENTS OF ORDINANCE, ORDER, OR RESOLUTION
617-10   AUTHORIZING BONDS.  (a)  In the ordinance, order, or resolution
617-11   authorizing the issuance of bonds under this subchapter, the
617-12   governing body of a municipality may provide for the deposit and
617-13   accounting of money and the establishment and maintenance of an
617-14   interest and sinking fund, a reserve fund, or another fund.
617-15         (b)  The ordinance, order, or resolution may make additional
617-16   covenants relating to the bonds, the pledged revenue, or the
617-17   operation and maintenance of any land, building, or other facility
617-18   the revenue of which is pledged for bond payments.  (V.A.C.S.
617-19   Art. 835s, Sec.  6(c).)
617-20         Sec. 1509.007.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
617-21   governing body of a municipality may adopt and have executed any
617-22   proceeding or instrument necessary and convenient in:
617-23               (1)  the issuance of bonds under this subchapter; or
617-24               (2)  the acquisition and sale or lease of any land,
617-25   building, or other facility under Section 1509.001 or 1509.002.
617-26   (V.A.C.S. Art. 835s, Sec. 7.)
617-27         Sec. 1509.008.  MATURITY.  A bond issued under this
 618-1   subchapter must mature not later than 40 years after its date.
 618-2   (V.A.C.S. Art. 835s, Sec. 6(b) (part).)
 618-3         Sec. 1509.009.  IMPOSITION OF TAX.  (a)  The governing body
 618-4   of a municipality may annually impose ad valorem taxes to pay the
 618-5   principal of and interest on bonds issued under this subchapter
 618-6   that are payable in whole or in part from ad valorem taxes only if
 618-7   the taxes are approved at an election held under Section 1509.005.
 618-8         (b)  A municipality may not impose ad valorem taxes to pay
 618-9   the principal of or interest on bonds issued under this subchapter
618-10   payable wholly from revenue from one or more leases or other
618-11   contracts made under this subchapter.  (V.A.C.S. Art. 835s, Sec.
618-12   10.)
618-13         Sec. 1509.010.  GRANTS FOR PRISONS OR LAW ENFORCEMENT
618-14   FACILITIES NOT PROHIBITED.  This subchapter does not prohibit a
618-15   municipality from making a grant of money or property to an agency
618-16   of this state to assist the agency in acquiring or developing a
618-17   site for a prison or other law enforcement detention facility,
618-18   regardless of whether the site is located inside or outside the
618-19   municipal boundaries.  (V.A.C.S. Art. 835s, Sec. 11.)
618-20           (Sections 1509.011-1509.050 reserved for expansion)
618-21           SUBCHAPTER B.  BONDS FOR FIRE-FIGHTING EQUIPMENT IN
618-22            MUNICIPALITIES WITH POPULATION OF LESS THAN 5,000
618-23         Sec. 1509.051.  APPLICABILITY OF SUBCHAPTER.  This subchapter
618-24   applies only to a municipality with a population of less than
618-25   5,000.  (V.A.C.S. Art. 835n (part).)
618-26         Sec. 1509.052.  AUTHORITY TO ISSUE BONDS.  A municipality
618-27   may, in compliance with Subtitles A and C, issue bonds to purchase
 619-1   fire-fighting equipment.  (V.A.C.S. Art. 835n (part).)
 619-2           (Sections 1509.053-1509.100 reserved for expansion)
 619-3       SUBCHAPTER C.  BONDS FOR FARMERS' MARKETS IN MUNICIPALITIES
 619-4                  WITH POPULATION OF MORE THAN 650,000
 619-5         Sec. 1509.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 619-6   applies only to a municipality with a population of more than
 619-7   650,000.  (V.A.C.S. Art. 1269j-4.9, Sec. 2.)
 619-8         Sec. 1509.102.  DEFINITION.  In this subchapter, "farmers'
 619-9   market" means a public marketplace where a person is permitted to
619-10   sell agricultural and other products.  (V.A.C.S.  Art. 1269j-4.9,
619-11   Sec. 1.)
619-12         Sec. 1509.103.  AUTHORITY FOR FARMERS' MARKET.  A
619-13   municipality may:
619-14               (1)  acquire, lease as lessor or lessee, construct,
619-15   improve, enlarge, or operate a farmers' market; and
619-16               (2)  contract with any public or private entity to
619-17   perform any function authorized by this section.  (V.A.C.S.
619-18   Art. 1269j-4.9, Sec. 3.)
619-19         Sec. 1509.104.  AUTHORITY TO ISSUE REVENUE BONDS.  The
619-20   governing body of a municipality may issue revenue bonds for a
619-21   purpose authorized by Section 1509.103.  (V.A.C.S. Art. 1269j-4.9,
619-22   Sec.  4 (part).)
619-23         Sec. 1509.105.  PLEDGE OF REVENUE.  A municipality may pledge
619-24   all or part of the revenue, income, or receipts from the farmers'
619-25   market to the payment of the bonds, including principal, interest,
619-26   and any other amounts required or permitted in connection with the
619-27   bonds.  (V.A.C.S. Art. 1269j-4.9, Secs. 4 (part), 7(a) (part).)
 620-1         Sec. 1509.106.  ADDITIONAL SECURITY.  (a)  Bonds issued under
 620-2   this subchapter may be additionally secured by:
 620-3               (1)  an encumbrance on any real property relating to a
 620-4   farmers' market owned or to be acquired by the municipality;
 620-5               (2)  an encumbrance on any personal property
 620-6   appurtenant to real property described by Subdivision (1); or
 620-7               (3)  a pledge of any portion of a grant, donation, or
 620-8   revenue, or income received or to be received from the United
 620-9   States or any other public or private source.
620-10         (b)  The governing body of the municipality may authorize the
620-11   execution of a trust indenture, mortgage, deed of trust, or other
620-12   instrument as evidence of the encumbrance.  (V.A.C.S.
620-13   Art. 1269j-4.9, Secs. 7(b), (c).)
620-14         Sec. 1509.107.  MATURITY.  A bond issued under this
620-15   subchapter must mature not later than 40 years after its date.
620-16   (V.A.C.S. Art. 1269j-4.9, Sec. 5(a) (part).)
620-17         Sec. 1509.108.  ADDITIONAL BONDS.  The ordinance authorizing
620-18   the issuance of bonds under this subchapter may provide for the
620-19   subsequent issuance of additional parity bonds or subordinate lien
620-20   bonds under terms specified in the ordinance.  (V.A.C.S.
620-21   Art. 1269j-4.9, Sec. 5(a) (part).)
620-22         Sec. 1509.109.  SALE OF BONDS.  A municipality may sell bonds
620-23   issued under this subchapter in the manner and under the terms
620-24   provided by the ordinance authorizing the issuance of the bonds.
620-25   (V.A.C.S. Art. 1269j-4.9, Sec. 5(b) (part).)
620-26         Sec. 1509.110.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
620-27   BONDS.  (a)  If bonds issued under this subchapter state that the
 621-1   bonds are secured by a pledge of revenue or rents from a contract,
 621-2   including a lease contract, a copy of the contract and the
 621-3   proceedings related to it must be submitted to the attorney
 621-4   general.
 621-5         (b)  If the attorney general finds that the bonds have been
 621-6   authorized and the contract has been made in accordance with law,
 621-7   the attorney general shall approve the contract.
 621-8         (c)  After the bonds are approved and registered as provided
 621-9   by Chapter 1202 and the contract is approved under Subsection (b),
621-10   the contract is incontestable in a court or other forum for any
621-11   reason and is a valid and binding obligation for all purposes in
621-12   accordance with its terms.  (V.A.C.S. Art. 1269j-4.9, Sec. 10
621-13   (part).)
621-14         Sec. 1509.111.  CHARGES.  (a)  The governing body of a
621-15   municipality may impose and collect charges for the use or
621-16   availability of the farmers' market.
621-17         (b)  The municipality shall impose and collect pledged
621-18   charges in an amount that will be at least sufficient, with any
621-19   other pledged resources, to provide for the payment of:
621-20               (1)  the principal of, interest on, and any other
621-21   amounts required in connection with the bonds; and
621-22               (2)  to the extent required by the ordinance
621-23   authorizing the issuance of the bonds:
621-24                     (A)  expenses incurred in connection with the
621-25   bonds; and
621-26                     (B)  operation, maintenance, and other expenses
621-27   incurred in connection with the farmers' market.  (V.A.C.S.
 622-1   Art. 1269j-4.9, Secs. 6, 7(a) (part).)
 622-2         Sec. 1509.112.  REFUNDING BONDS.  (a)  A municipality may
 622-3   refund or otherwise refinance bonds issued under this subchapter by
 622-4   issuing refunding bonds under any terms provided by an ordinance of
 622-5   the governing body of the municipality.
 622-6         (b)  All appropriate provisions of this subchapter apply to
 622-7   the refunding bonds.  The refunding bonds shall be issued in the
 622-8   manner provided by this subchapter for other bonds.
 622-9         (c)  The refunding bonds may be sold and delivered in amounts
622-10   sufficient to pay the principal of and interest and any redemption
622-11   premium on the bonds to be refunded, at maturity or on any
622-12   redemption date.
622-13         (d)  The refunding bonds may be issued to be exchanged for
622-14   the bonds to be refunded by them.  In that case, the comptroller
622-15   shall register the refunding bonds and deliver them to the holder
622-16   of the bonds to be refunded as provided by the ordinance
622-17   authorizing the refunding bonds.  The exchange may be made in one
622-18   delivery or in installment deliveries.  (V.A.C.S. Art. 1269j-4.9,
622-19   Secs. 9(a), (b).)
622-20         Sec. 1509.113.  PUBLIC PURPOSE.  The acquisition,
622-21   construction, improvement, enlargement, equipment, operation, or
622-22   maintenance of property or a facility for providing a farmers'
622-23   market is a public purpose and a proper municipal function.
622-24   (V.A.C.S. Art. 1269j-4.9, Sec. 8.)
622-25         Sec. 1509.114.  CONFLICT WITH OTHER LAW.  When bonds are
622-26   issued under this subchapter, to the extent of any conflict between
622-27   this subchapter and another law, this subchapter controls.
 623-1   (V.A.C.S. Art. 1269j-4.9, Sec. 12 (part).)
 623-2           (Sections 1509.115-1509.150 reserved for expansion)
 623-3          SUBCHAPTER D.  BONDS FOR GARBAGE RECLAMATION PROJECTS
 623-4         Sec. 1509.151.  DEFINITION.  In this chapter, "garbage
 623-5   reclamation project" means an undertaking by which solid waste
 623-6   products are converted into a form usable by persons for any
 623-7   purpose, including the production of energy.  (V.A.C.S.
 623-8   Art. 4477-7b, Sec. 1(2).)
 623-9         Sec. 1509.152.  AUTHORITY FOR GARBAGE RECLAMATION PROJECTS.
623-10   A municipality may own and operate a garbage reclamation project.
623-11   (V.A.C.S. Art. 4477-7b, Sec. 2.)
623-12         Sec. 1509.153.  AUTHORITY TO ISSUE BONDS.  If necessary to
623-13   exercise the authority granted by Section 1509.152, the governing
623-14   body of a municipality may issue and sell bonds to finance:
623-15               (1)  the purchase, lease, or acquisition by another
623-16   method of land, a facility, equipment, or supplies;
623-17               (2)  the construction or improvement of a facility; and
623-18               (3)  the installation of equipment.  (V.A.C.S.
623-19   Art. 4477-7b, Sec. 3.)
623-20         Sec. 1509.154.  BOND PAYMENTS FROM REVENUE OR TAXES.  The
623-21   governing body of the municipality may provide for payment of the
623-22   principal of and interest on bonds issued under this subchapter by:
623-23               (1)  pledging all or part of the revenue from the
623-24   ownership or operation of a garbage reclamation project;
623-25               (2)  imposing an ad valorem tax; or
623-26               (3)  combining those sources.  (V.A.C.S. Art. 4477-7b,
623-27   Sec. 4.)
 624-1         Sec. 1509.155.  ADDITIONAL SECURITY.  (a)  Bonds issued under
 624-2   this subchapter may be secured additionally by an encumbrance on
 624-3   part or all of the physical property of the garbage reclamation
 624-4   project and each right relating to that property, vesting in the
 624-5   trustee the power to:
 624-6               (1)  operate the property;
 624-7               (2)  sell the property to pay the debt; or
 624-8               (3)  take any other action to secure the bonds.
 624-9         (b)  Regardless of an encumbrance on the property, a trust
624-10   indenture on the property may:
624-11               (1)  contain any provision that the governing body of
624-12   the municipality prescribes for the security of the bonds and the
624-13   preservation of the trust estate;
624-14               (2)  provide for amendment or modification of the trust
624-15   indenture; and
624-16               (3)  provide for investment of revenue from the garbage
624-17   reclamation project.
624-18         (c)  A purchaser under a sale under the encumbrance of the
624-19   property:
624-20               (1)  is the absolute owner of the property and the
624-21   rights purchased; and
624-22               (2)  may maintain and operate the property.  (V.A.C.S.
624-23   Art. 4477-7b, Sec. 5.)
624-24         Sec. 1509.156.  ELECTION.  (a)  The governing body of the
624-25   municipality may not issue bonds under this subchapter unless the
624-26   issuance is authorized by a majority of the qualified voters of the
624-27   municipality voting at an election held for that purpose.
 625-1         (b)  The governing body shall hold the election, to the
 625-2   extent practicable, in compliance with Chapter 1251.  (V.A.C.S.
 625-3   Art. 4477-7b, Secs. 6(a), (b).)
 625-4         Sec. 1509.157.  BALLOT PROPOSITION.  (a)  At an election to
 625-5   authorize bonds payable wholly from revenue from the garbage
 625-6   reclamation project, the ballots shall be printed to provide for
 625-7   voting for or against the proposition: "The issuance of bonds for a
 625-8   garbage reclamation project in the amount of $__________ and the
 625-9   pledge of net revenue from the project for the payment of the
625-10   bonds."
625-11         (b)  At an election to authorize bonds payable wholly from ad
625-12   valorem taxes, the ballots shall be printed to provide for voting
625-13   for or against the proposition:  "The issuance of bonds for a
625-14   garbage reclamation project in the amount of $__________ and the
625-15   imposition of taxes for payment of the bonds."
625-16         (c)  At an election to authorize bonds payable from both
625-17   revenue from the garbage reclamation project and ad valorem taxes,
625-18   the ballots shall be printed to provide for voting for or against
625-19   the proposition:  "The issuance of bonds for a garbage reclamation
625-20   project in the amount of $__________ and the pledge of net revenue
625-21   and the imposition of ad valorem taxes adequate to provide for the
625-22   payment of the bonds."  (V.A.C.S. Art. 4477-7b, Sec. 6(c).)
625-23         Sec. 1509.158.  CONTENTS OF ORDER OR RESOLUTION AUTHORIZING
625-24   BONDS.  (a)  An order or resolution of the governing body of the
625-25   municipality authorizing the issuance of bonds under this
625-26   subchapter may provide for the flow of funds and the establishment
625-27   and maintenance of an interest and sinking fund, a reserve fund, or
 626-1   another fund.
 626-2         (b)  The order or resolution may:
 626-3               (1)  prohibit the further issuance of bonds or other
 626-4   obligations payable from the pledged revenue; or
 626-5               (2)  reserve the right to issue additional bonds to be
 626-6   secured by a pledge of and payable from the revenue that are on a
 626-7   parity with, or subordinate to, the lien and pledge on the revenue
 626-8   being used to support the bonds being issued.
 626-9         (c)  The order or resolution may contain any other provision
626-10   or covenant, including a covenant with respect to the bonds, the
626-11   pledged revenue, or the operation and maintenance of the garbage
626-12   reclamation project the revenue of which is pledged.  (V.A.C.S.
626-13   Art. 4477-7b, Secs. 8(a), (b), (c).)
626-14         Sec. 1509.159.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
626-15   governing body of the municipality may adopt and have executed any
626-16   other proceeding or instrument necessary and convenient in the
626-17   issuance of bonds under this subchapter.  (V.A.C.S. Art. 4477-7b,
626-18   Sec. 8(d).)
626-19         Sec. 1509.160.  MATURITY.  A bond issued under this
626-20   subchapter must mature not later than 40 years after its date.
626-21   (V.A.C.S. Art. 4477-7b, Secs. 7(b) (part), 10(b) (part).)
626-22         Sec. 1509.161.  IMPOSITION OF TAX.  (a)  The governing body
626-23   of the municipality may annually impose ad valorem taxes to pay
626-24   bonds issued under this subchapter that are payable in whole or in
626-25   part from ad valorem taxes.
626-26         (b)  The governing body may not impose ad valorem taxes to
626-27   pay the principal of or interest on bonds issued under this
 627-1   subchapter payable wholly from revenue from a garbage reclamation
 627-2   project.  (V.A.C.S. Art. 4477-7b, Sec. 14.)
 627-3         Sec. 1509.162.  REFUNDING BONDS.  (a)  A municipality may
 627-4   issue refunding bonds to refund all or any part of its outstanding
 627-5   bonds issued under this subchapter, including matured but unpaid
 627-6   interest coupons.  The comptroller shall register refunding bonds
 627-7   on the surrender and cancellation of the bonds being refunded.  The
 627-8   refunding may take place in one delivery or in installment
 627-9   deliveries.
627-10         (b)  The refunding bonds may be payable from the same sources
627-11   as the bonds to be refunded or from other additional sources.
627-12         (c)  A municipality may, in the order or resolution
627-13   authorizing the issuance of the refunding bonds, provide for the
627-14   sale of the refunding bonds and the deposit of the proceeds in the
627-15   place at which the bonds to be refunded are payable.  In that case,
627-16   the refunding bonds may be issued before the cancellation of the
627-17   bonds to be refunded.
627-18         (d)  If refunding bonds are issued before cancellation of the
627-19   bonds to be refunded, the municipality shall deposit an amount
627-20   sufficient to pay the principal of and interest on the bonds to be
627-21   refunded to their maturity dates, or to their option dates if the
627-22   bonds have been called for payment before maturity according to
627-23   their terms, in each place at which the bonds to be refunded are
627-24   payable.  The comptroller shall register the refunding bonds
627-25   without the surrender and cancellation of bonds to be refunded.
627-26   (V.A.C.S. Art. 4477-7b, Secs. 10(a), (c), (d) (part), (e), (f)
627-27   (part).)
 628-1         Sec. 1509.163.  EXEMPTION FROM TAXATION.  A bond issued under
 628-2   this subchapter, any transaction related to the bond, and profits
 628-3   made in the sale of the bond are exempt from taxation by this state
 628-4   or by a municipality or other political subdivision of this state.
 628-5   (V.A.C.S. Art. 4477-7b, Sec. 13 (part).)
 628-6           (Sections 1509.164-1509.200 reserved for expansion)
 628-7           SUBCHAPTER E.  BONDS FOR ACQUISITION OF PROPERTY BY
 628-8           MUNICIPALITY OPERATING TOLL BRIDGE OVER RIO GRANDE
 628-9         Sec. 1509.201.  APPLICABILITY OF SUBCHAPTER.  This subchapter
628-10   applies only to a municipality that owns and operates a portion of
628-11   a toll bridge over the Rio Grande.  (V.A.C.S. Art. 1015g-4,
628-12   Sec. 1.)
628-13         Sec. 1509.202.  AUTHORITY FOR PROPERTY, FACILITY, OR
628-14   ACTIVITY.  A municipality may acquire, construct, improve, enlarge,
628-15   equip, operate, or maintain property, a facility, or an activity
628-16   for a public purpose.  (V.A.C.S. Art. 1015g-4, Sec. 2.)
628-17         Sec. 1509.203.  AUTHORITY TO ISSUE REVENUE BONDS.  To provide
628-18   money to acquire, construct, improve, enlarge, or equip property or
628-19   a facility for a public purpose, the governing body of a
628-20   municipality may issue revenue bonds that are payable from and
628-21   secured by a lien on and pledge of all or any part of the revenue,
628-22   income, or receipts the municipality receives from its ownership
628-23   and operation of:
628-24               (1)  a portion of a toll bridge over the Rio Grande; or
628-25               (2)  property, a facility, or an activity.  (V.A.C.S.
628-26   Art. 1015g-4, Sec.  3.)
628-27         Sec. 1509.204.  PLEDGE OF REVENUE.  A municipality may pledge
 629-1   to the payment of bonds issued under this subchapter, including the
 629-2   principal of, interest on, or another amount required or permitted
 629-3   to be paid in connection with the bonds, all or any part of its
 629-4   revenue, income, or receipts from:
 629-5               (1)  a charge authorized by Section 1509.210; or
 629-6               (2)  another resource.  (V.A.C.S. Art. 1015g-4, Sec.
 629-7   6(a) (part).)
 629-8         Sec. 1509.205.  ADDITIONAL SECURITY.  (a)  Bonds issued under
 629-9   this subchapter may be additionally secured by:
629-10               (1)  an encumbrance on any real property owned by the
629-11   municipality;
629-12               (2)  an encumbrance on any personal property
629-13   appurtenant to that real property; or
629-14               (3)  a pledge of any portion of a grant, donation,
629-15   revenue, or income received or to be received from the United
629-16   States or any other public or private source.
629-17         (b)  The governing body of the municipality may authorize the
629-18   execution of a trust indenture, mortgage, deed of trust, or other
629-19   instrument as evidence of the encumbrance.  (V.A.C.S. Art. 1015g-4,
629-20   Secs. 6(b), (c).)
629-21         Sec. 1509.206.  BONDS NOT PAYABLE FROM TAXES.  A bond issued
629-22   under this  subchapter:
629-23               (1)  is payable only from the revenue, income,
629-24   receipts, or another resource of the municipality as provided by
629-25   this subchapter; and
629-26               (2)  is not a tax obligation of the municipality.
629-27   (V.A.C.S. Art. 1015g-4, Sec. 8.)
 630-1         Sec. 1509.207.  MATURITY.  A bond issued under this
 630-2   subchapter must mature not later than 50 years after its date.
 630-3   (V.A.C.S. Art. 1015g-4, Sec.  4(a) (part).)
 630-4         Sec. 1509.208.  ADDITIONAL BONDS.  The ordinance authorizing
 630-5   the issuance of bonds under this subchapter may provide for the
 630-6   subsequent issuance of additional parity or subordinate lien bonds
 630-7   under terms specified in the ordinance.  (V.A.C.S.  Art. 1015g-4,
 630-8   Sec.  4(a) (part).)
 630-9         Sec. 1509.209.  SALE OF BONDS.  A municipality may sell bonds
630-10   issued under this subchapter in the manner and on the terms
630-11   provided by the bond authorization.  (V.A.C.S.  Art. 1015g-4, Sec.
630-12   4(b) (part).)
630-13         Sec. 1509.210.  CHARGES.  (a)  The governing body of the
630-14   municipality may impose and collect a charge for the use or
630-15   availability of:
630-16               (1)  municipal property, including a toll bridge or
630-17   other facility; or
630-18               (2)  a municipal activity or operation.
630-19         (b)  The governing body shall impose and collect pledged
630-20   charges in an amount that will be at least sufficient, with any
630-21   other pledged resource, to provide for the payment of:
630-22               (1)  the principal of, interest on, and any other
630-23   amount required in connection with the bonds; and
630-24               (2)  to the extent required by the ordinance
630-25   authorizing the issuance of the bonds:
630-26                     (A)  expenses incurred in connection with the
630-27   bonds; and
 631-1                     (B)  operation, maintenance, and other expenses
 631-2   incurred in connection with the property, toll bridge, or other
 631-3   facility.  (V.A.C.S. Art. 1015g-4, Secs.  5, 6(a) (part).)
 631-4         Sec. 1509.211.  LEASE OR RENTAL OF PROPERTY OR FACILITY TO
 631-5   UNITED STATES.  The municipality may lease or rent to the United
 631-6   States any property or facility acquired, constructed, improved,
 631-7   enlarged, or equipped in whole or in part with proceeds from the
 631-8   sale of bonds issued under this subchapter.  (V.A.C.S.
 631-9   Art. 1015g-4, Sec. 7 (part).)
631-10         Sec. 1509.212.  REFUNDING BONDS.  (a)  A municipality may
631-11   refund or otherwise refinance bonds issued under this subchapter by
631-12   issuing refunding bonds under any terms provided by an ordinance of
631-13   the governing body of the municipality.
631-14         (b)  All appropriate provisions of this subchapter apply to
631-15   the refunding bonds.  The refunding bonds shall be issued in the
631-16   manner provided by this subchapter for other bonds.
631-17         (c)  The refunding bonds may be sold and delivered in amounts
631-18   sufficient to pay the principal of and interest and any redemption
631-19   premium on the bonds to be refunded, at maturity or on any
631-20   redemption date.
631-21         (d)  The refunding bonds may be issued to be exchanged for
631-22   the bonds to be refunded by them.  In that case, the comptroller
631-23   shall register the refunding bonds and deliver them to the holder
631-24   of the bonds to be refunded as provided by the ordinance
631-25   authorizing the refunding bonds.  The exchange may be made in one
631-26   delivery or in installment deliveries.  (V.A.C.S. Art. 1015g-4,
631-27   Sec. 9 (part).)
 632-1         Sec. 1509.213.  PUBLIC PURPOSE.  The acquisition,
 632-2   construction, improvement, enlargement, or equipment by a
 632-3   municipality of property or a facility for lease or rental to the
 632-4   United States for use in performing a federal governmental function
 632-5   in the municipality or at or near and relating to a toll bridge of
 632-6   the municipality is a public purpose and a proper municipal
 632-7   function, regardless of whether the toll bridge or the federal
 632-8   facility relating to the bridge is located inside or outside the
 632-9   municipal boundaries.  (V.A.C.S. Art. 1015g-4, Sec. 7 (part).)
632-10         Sec. 1509.214.  CONFLICT WITH OTHER LAW.  When bonds are
632-11   being issued under this subchapter, to the extent of a conflict
632-12   between this subchapter and another law, this subchapter controls.
632-13   (V.A.C.S. Art. 1015g-4, Sec. 12 (part).)
632-14           (Sections 1509.215-1509.250 reserved for expansion)
632-15        SUBCHAPTER F.  ENCUMBRANCE OF SLAUGHTERHOUSES IN CERTAIN
632-16                         COASTAL MUNICIPALITIES
632-17         Sec. 1509.251.  APPLICABILITY OF SUBCHAPTER.  This subchapter
632-18   applies only to a municipality that is located not more than:
632-19               (1)  100 miles from the Gulf of Mexico; and
632-20               (2)  50 miles from a stream that forms an international
632-21   boundary.  (V.A.C.S. Art. 1187d, Secs. 1 (part), 2 (part).)
632-22         Sec. 1509.252.  ENCUMBRANCE OF SLAUGHTERHOUSE.  To obtain
632-23   money to construct a slaughterhouse, or to construct, improve,
632-24   enlarge, extend, or repair a permanent improvement to a
632-25   slaughterhouse, a municipality may:
632-26               (1)  pledge the income from or encumber an existing or
632-27   proposed slaughterhouse and anything pertaining to the
 633-1   slaughterhouse; and
 633-2               (2)  as additional security, in the pledge or
 633-3   encumbrance, grant to a purchaser under sale or foreclosure a
 633-4   franchise to operate the slaughterhouse for a term not to exceed 30
 633-5   years from the date of purchase, subject to all laws regulating the
 633-6   same then in force.  (V.A.C.S. Art. 1187d, Secs. 1 (part), 2
 633-7   (part).)
 633-8         Sec. 1509.253.  OBLIGATIONS NOT DEBT OF MUNICIPALITY.  An
 633-9   obligation issued under this subchapter:
633-10               (1)  is not a debt of the municipality;
633-11               (2)  may be a charge only against the encumbered
633-12   property; and
633-13               (3)  may not be included in determining the power of
633-14   the municipality to issue bonds for any purpose authorized by law.
633-15   (V.A.C.S. Art. 1187d, Secs. 1 (part), 2 (part).)
633-16         Sec. 1509.254.  ELECTION NOT REQUIRED FOR CERTAIN
633-17   OBLIGATIONS.  (a)  A municipality may issue notes or warrants under
633-18   this subchapter in an amount not to exceed $50,000 without an
633-19   election in connection with the issuance.
633-20         (b)  To the extent of any conflict between Subsection (a) and
633-21   a municipal charter, Subsection (a) controls.  (V.A.C.S.
633-22   Art. 1187d, Sec. 3.)
633-23           (Sections 1509.255-1509.900 reserved for expansion)
633-24                 SUBCHAPTER Z.  MISCELLANEOUS PROVISIONS
633-25         Sec. 1509.901.  PLEDGE OF REVENUE FROM TOLL BRIDGE CONTRACT.
633-26   A municipality that receives revenue because of a contract with
633-27   another municipality relating to the operation of a toll bridge
 634-1   over the Rio Grande may appropriate or pledge all or any part of
 634-2   that revenue to:
 634-3               (1)  redeem or pay the principal of or interest on any
 634-4   bond, note, or warrant that the municipality is authorized to
 634-5   issue; or
 634-6               (2)  retire any other debt the municipality is
 634-7   authorized to incur.  (V.A.C.S. Art. 1015g-1.)
 634-8         Sec. 1509.902.  AUTHORITY TO ISSUE BONDS PAYABLE FROM TOLL
 634-9   BRIDGE REVENUE; PLEDGE OF TOLL BRIDGE REVENUE.  (a)  This section
634-10   applies only to a municipality that:
634-11               (1)  has located within its municipal boundaries or
634-12   within 15 miles of its municipal boundaries a toll bridge over the
634-13   Rio Grande; and
634-14               (2)  receives revenue because of that bridge, including
634-15   revenue received under a contract with another municipality
634-16   relating to the operation of that bridge.
634-17         (b)  The municipality may issue revenue bonds under this
634-18   section payable from revenue received because of the toll bridge to
634-19   acquire, construct, repair, extend, or improve any public building,
634-20   utility system, or other public property or facility the governing
634-21   body of the municipality considers necessary and appropriate.
634-22         (c)  A municipality may issue the bonds without an election
634-23   if the governing body of the municipality authorizes the issuance
634-24   by ordinance.
634-25         (d)  Subject to any covenant relating to an outstanding bond
634-26   of the municipality, a municipality may appropriate or pledge to
634-27   the payment of bonds issued under this section all or any part of
 635-1   the revenue the municipality receives because of the toll bridge.
 635-2         (e)  A bond issued under this section must mature not later
 635-3   than 40 years after its date.  (V.A.C.S. Art. 1015g-3, Secs. 1, 2
 635-4   (part).)
 635-5         SECTION 2.  CONFORMING AMENDMENT.  Subchapter B, Chapter 301,
 635-6   Government Code, is amended by adding Section 301.033 to read as
 635-7   follows:
 635-8         Sec. 301.033.  ALLOCATION OF SPACE IN LEGISLATIVE SERVICES
 635-9   BUILDING.  (a)  The space in the legislative services office
635-10   building and parking facilities authorized by Chapter 168, Acts of
635-11   the 74th Legislature, Regular Session, 1995, is allocated to the
635-12   legislature and legislative agencies for their use.  The presiding
635-13   officers of each house of the legislature shall jointly decide the
635-14   allocation of the space in the building and facilities.
635-15         (b)  The building shall be known as the Robert E. Johnson
635-16   Building.  (V.A.C.S. Art. 601d, Secs. 27(b), (c).)
635-17         SECTION 3.  CONFORMING AMENDMENT.  Section 443.0151(a),
635-18   Government Code, is amended to read as follows:
635-19         (a)  The board shall operate a garage or similar parking
635-20   facility for the benefit of visitors to the Capitol Complex.  The
635-21   parking facility is under the control of the board. (V.A.C.S.
635-22   Art. 601d, Sec. 24B(b) (part).)
635-23         SECTION 4.  CONFORMING AMENDMENT.  Subtitle A, Title 6,
635-24   Government Code, is amended by adding Chapter 618 to read as
635-25   follows:
635-26                CHAPTER 618.  UNIFORM FACSIMILE SIGNATURE
635-27                         OF PUBLIC OFFICIALS ACT
 636-1         Sec. 618.001.  SHORT TITLE.  This chapter may be cited as the
 636-2   Uniform Facsimile Signature of Public Officials Act.  (V.A.C.S.
 636-3   Art. 717j-1, Sec. 6.)
 636-4         Sec. 618.002.  DEFINITIONS.  In this chapter:
 636-5               (1)  "Authorized officer" means any official of this
 636-6   state, a political subdivision of this state, or a department,
 636-7   agency, or instrumentality of this state or of a political
 636-8   subdivision of this state whose signature is required or permitted
 636-9   to be placed on a public security, eligible contract, instrument of
636-10   payment, or certificate of assessment.
636-11               (2)  "Certificate of assessment" means a certificate or
636-12   instrument evidencing a special assessment that is issued by an
636-13   agency or political subdivision of this state.
636-14               (3)  "Eligible contract" means a written evidence of
636-15   agreement, including a contract, purchase order, and surety bond,
636-16   and any related document, including an application, certificate,
636-17   and approval, other than a public security or instrument of
636-18   payment, that is executed, authenticated, certified, or endorsed
636-19   for or on behalf of a home-rule municipality with a population of
636-20   1.2 million or more.
636-21               (4)  "Facsimile signature" means a reproduction of the
636-22   manual signature of an authorized officer that is made by any
636-23   method, including engraving, imprinting, lithographing, and
636-24   stamping.
636-25               (5)  "Instrument of payment" means a check, draft,
636-26   warrant, or order for the payment, delivery, or transfer of money.
636-27               (6)  "Public security" means an obligation for the
 637-1   payment of money, including a bond, note, and certificate of
 637-2   indebtedness, that is issued by this state, a political subdivision
 637-3   of this state, or a department, agency, or instrumentality of this
 637-4   state or of a political subdivision of this state.  (V.A.C.S.
 637-5   Art. 717j-1, Sec. 1.)
 637-6         Sec. 618.003.  AUTHORITY FOR FACSIMILE SIGNATURE.  Except as
 637-7   provided by Section 618.004, an authorized officer may execute,
 637-8   authenticate, certify, or endorse or authorize to be executed,
 637-9   authenticated, certified, or endorsed with the officer's facsimile
637-10   signature instead of the officer's manual signature:
637-11               (1)  a public security, instrument of payment, or
637-12   certificate of assessment, if the use of the facsimile signature is
637-13   authorized by the board, body, or officer empowered to authorize
637-14   the issuance of the security, instrument, or certificate; or
637-15               (2)  an eligible contract, if the use of the facsimile
637-16   signature is authorized by the governing body of the municipality.
637-17   (V.A.C.S.  Art. 717j-1, Sec. 2 (part).)
637-18         Sec. 618.004.  MANUAL SIGNATURE ON PUBLIC SECURITY.  (a)  At
637-19   least one signature that is required or permitted to be placed on a
637-20   public security must be manually subscribed.
637-21         (b)  Only the comptroller's signature or that of a deputy
637-22   designated in writing to act for the comptroller is required to be
637-23   manually subscribed on a public security required to be registered
637-24   by the comptroller or a certificate on that security.  (V.A.C.S.
637-25   Art. 717j-1, Sec. 2 (part).)
637-26         Sec. 618.005.  EFFECT OF FACSIMILE SIGNATURE.  A facsimile
637-27   signature placed in compliance with this chapter has the same legal
 638-1   effect as the authorized officer's manual signature.  (V.A.C.S.
 638-2   Art. 717j-1, Sec. 2 (part).)
 638-3         Sec. 618.006.  LACK OF AUTHORITY NOT DEFENSE.  In a suit or
 638-4   other legal action against an authorized officer whose facsimile
 638-5   signature is placed under this chapter on a public security,
 638-6   instrument of payment, certificate of assessment, or eligible
 638-7   contract, the placement of the facsimile signature without the
 638-8   officer's authority or consent is not a defense.  (V.A.C.S.
 638-9   Art. 717j-1, Sec. 2 (part).)
638-10         Sec. 618.007.  AUTHORITY FOR FACSIMILE SEAL.  If the seal of
638-11   this state, a political subdivision of this state, or a department,
638-12   agency, or instrumentality of this state or of a political
638-13   subdivision of this state is required in the execution,
638-14   authentication, certification, or endorsement of a public security,
638-15   instrument of payment, certificate of assessment, or eligible
638-16   contract, an appropriate authorized officer may authorize the
638-17   printing, engraving, lithographing, stamping, or other placement of
638-18   a facsimile of the seal on the document.  (V.A.C.S. Art. 717j-1,
638-19   Sec. 3 (part).)
638-20         Sec. 618.008.  EFFECT OF FACSIMILE SEAL.  A facsimile seal
638-21   placed in compliance with this chapter has the same legal effect as
638-22   an impression of the seal.  (V.A.C.S. Art. 717j-1, Sec. 3 (part).)
638-23         Sec. 618.009.  FRAUDULENT PLACEMENT OF FACSIMILE SIGNATURE OR
638-24   SEAL; OFFENSE.  (a)  A person commits an offense if, with intent to
638-25   defraud, the person places on a public security, instrument of
638-26   payment, certificate of assessment or eligible contract:
638-27               (1)  a facsimile signature or a reproduction of a
 639-1   facsimile signature; or
 639-2               (2)  a facsimile seal, or a reproduction of a facsimile
 639-3   seal, of this state, a political subdivision of this state, or a
 639-4   department, agency, or instrumentality of this state or a political
 639-5   subdivision of this state.
 639-6         (b)  An offense under this section is a felony punishable by
 639-7   imprisonment in the institutional division of the Texas Department
 639-8   of Criminal Justice for any term of not more than seven years or
 639-9   less than two years.  (V.A.C.S. Art. 717j-1, Sec. 4.)
639-10         SECTION 5.  CONFORMING AMENDMENT.  Subtitle F, Title 10,
639-11   Government Code, is amended by adding Chapter 2259 to read as
639-12   follows:
639-13           CHAPTER 2259.  SELF-INSURANCE BY GOVERNMENTAL UNITS
639-14                    SUBCHAPTER A.  GENERAL PROVISIONS
639-15         Sec. 2259.001.  DEFINITIONS.  In this chapter:
639-16               (1)  "Governmental unit" means:
639-17                     (A)  a state agency or institution;
639-18                     (B)  a local government; or
639-19                     (C)  an entity acting on behalf of a state agency
639-20   or institution or local government.
639-21               (2)  "Local government" means a municipality or other
639-22   political subdivision of this state or a combination of political
639-23   subdivisions, including a combination created under Chapter 791.
639-24               (3)  "Public security" means an obligation authorized
639-25   to be issued under this chapter, including a bond, certificate, or
639-26   note.
639-27               (4)  "State agency or institution" includes an
 640-1   institution of higher education.  (V.A.C.S. Art. 715c, Sec. 2.)
 640-2         Sec. 2259.002.  SELF-INSURANCE NOT WAIVER OF IMMUNITY.  The
 640-3   establishment and maintenance of a self-insurance program by a
 640-4   governmental unit is not a waiver of immunity or of a defense of
 640-5   the governmental unit or its employees.  (V.A.C.S. Art. 715c, Sec.
 640-6   6.)
 640-7           (Sections 2259.003-2259.030 reserved for expansion
 640-8                   SUBCHAPTER B.  SELF-INSURANCE FUND
 640-9         Sec. 2259.031.  ESTABLISHMENT OF FUND.  (a)  A governmental
640-10   unit may establish a self-insurance fund to protect the
640-11   governmental unit and its officers, employees, and agents from any
640-12   insurable risk or hazard.
640-13         (b)  The governmental unit may:
640-14               (1)  issue public securities and use the proceeds for
640-15   all or part of the fund; or
640-16               (2)  use any money available to the governmental unit
640-17   for the fund.  (V.A.C.S. Art. 715c, Sec. 4(a).)
640-18         Sec. 2259.032.  PUBLIC PURPOSE.  The issuance of a public
640-19   security or the use of available money for a self-insurance fund
640-20   under this subchapter is a public purpose of the governmental unit.
640-21   (V.A.C.S. Art. 715c, Sec.  4(b).)
640-22         Sec. 2259.033.  PAYMENT SOURCE FOR PUBLIC SECURITIES: STATE
640-23   AGENCY OR INSTITUTION.  Public securities issued by a state agency
640-24   or institution under this subchapter may be payable from any
640-25   available source of revenue.  (V.A.C.S. Art. 715c, Sec.  4(e).)
640-26         Sec. 2259.034.  PAYMENT SOURCE FOR PUBLIC SECURITIES: LOCAL
640-27   GOVERNMENT.  (a)  Public securities issued by a local government
 641-1   under this subchapter may be payable from taxes imposed by and
 641-2   revenues of the local government, including:
 641-3               (1)  ad valorem, sales and use, and hotel occupancy
 641-4   taxes;
 641-5               (2)  revenue derived by the local government from any
 641-6   system or other specified source; or
 641-7               (3)  any combination of taxes and revenue.
 641-8         (b)  The issuance of public securities by a local government
 641-9   under this subchapter that are payable from ad valorem taxes is
641-10   subject to the laws applicable to the issuance of public securities
641-11   by the local government for other purposes, including Chapter 1251,
641-12   with respect to the necessity for and conduct of an election.
641-13   (V.A.C.S. Art. 715c, Sec.  4(c).)
641-14         Sec. 2259.035.  SALE OF PUBLIC SECURITIES.  A governmental
641-15   unit may sell public securities issued under this subchapter at a
641-16   public or private sale.  (V.A.C.S. Art. 715c, Sec. 4(f).)
641-17         Sec. 2259.036.  COUNTY OR MUNICIPAL CERTIFICATES OF
641-18   OBLIGATION.  As provided by Subchapter C, Chapter 271, Local
641-19   Government Code, a county or municipality may issue and sell for
641-20   cash, at a public or private sale, certificates of obligation for
641-21   the establishment and maintenance of a self-insurance fund under
641-22   this subchapter.  (V.A.C.S. Art. 715c, Sec. 4(d).)
641-23         Sec. 2259.037.  APPLICABILITY OF INSURANCE LAWS.  The
641-24   Insurance Code and other laws of this state relating to the
641-25   provision or regulation of insurance do not apply to:
641-26               (1)  an agreement entered into under this subchapter;
641-27   or
 642-1               (2)  the proceeds of public securities issued under
 642-2   this subchapter.  (V.A.C.S. Art. 715c, Sec. 4(g).)
 642-3           (Sections 2259.038-2259.060 reserved for expansion
 642-4                  SUBCHAPTER C.  RISK RETENTION GROUPS
 642-5         Sec. 2259.061.  FORMATION OF RISK RETENTION GROUP.  A
 642-6   governmental unit may form or become a member of a risk retention
 642-7   group formed under the Liability Risk Retention Act of 1986 (15
 642-8   U.S.C. Section 3901 et seq.) to obtain insurance against an
 642-9   insurable risk.  (V.A.C.S. Art. 715c, Sec. 5(a).)
642-10         Sec. 2259.062.  PAYMENT SOURCE FOR GROUP:  STATE AGENCY OR
642-11   INSTITUTION.  A state agency or institution may make a payment
642-12   under a risk retention group agreement from any source, including a
642-13   legislative appropriation.  (V.A.C.S. Art. 715c, Sec. 5(d).)
642-14         Sec. 2259.063.  PAYMENT SOURCE FOR GROUP:  LOCAL GOVERNMENT.
642-15   (a)  A local government may make a payment under a risk retention
642-16   group agreement from proceeds of taxes imposed by and revenues of
642-17   the local government, including:
642-18               (1)  ad valorem, sales and use, and hotel occupancy
642-19   taxes;
642-20               (2)  revenue derived by the local government from any
642-21   system or other specified source; or
642-22               (3)  any combination of taxes and revenue.
642-23         (b)  A local government that does not have authority to
642-24   impose ad valorem taxes for payment of contractual debts may make a
642-25   payment under a risk retention group agreement from an annual
642-26   appropriation of proceeds of ad valorem taxes the local government
642-27   is authorized to impose.  (V.A.C.S. Art. 715c, Secs. 5(b), (c).)
 643-1         SECTION 6.  CONFORMING AMENDMENT.  Section 105.091, Local
 643-2   Government Code, is amended to read as follows:
 643-3         Sec. 105.091.  LIABILITY OF DESIGNATED OFFICER.  (a)  The
 643-4   designated officer is not responsible for any loss of municipal
 643-5   funds through the negligence, failure, or wrongful act of a
 643-6   depository.  This subsection [section] does not release the
 643-7   designated officer from responsibility for a loss resulting from
 643-8   the official misconduct of the designated officer, including a
 643-9   misappropriation of the funds, or from responsibility for the funds
643-10   until a depository is selected and the funds are deposited.
643-11         (b)  A designated officer who diverts money from an interest
643-12   and sinking fund or who applies money in that fund for a purpose
643-13   other than as permitted by Section 105.074(f) is:
643-14               (1)  subject to a penalty of not less than $500 or more
643-15   than $1,000; and
643-16               (2)  liable for the amount of money that is diverted.
643-17         (c)  The state is entitled to recover a penalty imposed under
643-18   Subsection (b)(1).  The amount of diverted money that is recovered
643-19   under Subsection (b)(2) shall be paid into the municipal treasury
643-20   to the credit of the fund from which it was diverted.
643-21         (d)  The attorney general or the district attorney of the
643-22   district in which the designated officer resides, or the county
643-23   attorney in a county that is not served by a district attorney, may
643-24   institute suit against the designated officer and the sureties on
643-25   the designated officer's official bond to recover the amounts
643-26   described by Subsection (b). (V.A.C.S. Arts. 840, 841 (part).)
643-27         SECTION 7.  CONFORMING AMENDMENT.  Section 113.005, Local
 644-1   Government Code, is amended to read as follows:
 644-2         Sec. 113.005.  LIABILITY OF COUNTY TREASURER.  (a)  The
 644-3   county treasurer is not responsible for any loss of the county
 644-4   funds through the failure or negligence of a depository.  This
 644-5   subsection [section] does not release the treasurer from
 644-6   responsibility for a loss resulting from the official misconduct or
 644-7   negligence of the treasurer, including a misappropriation of the
 644-8   funds, or from responsibility for funds until a depository is
 644-9   selected and the funds are deposited.
644-10         (b)  A treasurer who diverts money from an interest and
644-11   sinking fund or who applies money in that fund for a purpose other
644-12   than as permitted by Section 113.041(h) is:
644-13               (1)  subject to a penalty of not less than $500 or more
644-14   than $1,000; and
644-15               (2)  liable for the amount of money that is diverted.
644-16         (c)  The state is entitled to recover a penalty imposed under
644-17   Subsection (b)(1).  The amount of diverted money that is recovered
644-18   under Subsection (b)(2) shall be paid into the county treasury to
644-19   the credit of the fund from which it was diverted.
644-20         (d)  The attorney general or the district attorney of the
644-21   district in which the treasurer resides, or the county attorney in
644-22   a county that is not served by a district attorney, may institute
644-23   suit against the treasurer and the sureties on the treasurer's
644-24   official bond to recover the amounts described by Subsection (b).
644-25   (V.A.C.S. Arts. 840, 841 (part).)
644-26         SECTION 8.  CONFORMING AMENDMENT.  Section 113.041, Local
644-27   Government Code, is amended by adding Subsection (h) to read as
 645-1   follows:
 645-2         (h)  A county treasurer may not honor a check or warrant on
 645-3   the interest and sinking fund provided for a bond of the county or
 645-4   pay out or divert money in that fund except to pay the principal of
 645-5   or interest on the bond or invest money in securities as provided
 645-6   by law.  (V.A.C.S. Art. 839 (part).)
 645-7         SECTION 9.  CONFORMING AMENDMENT.  Subtitle A, Title 8, Local
 645-8   Government Code, is amended by adding Chapter 254 to read as
 645-9   follows:
645-10      CHAPTER 254.  ACQUISITION AND DEVELOPMENT OF ISLAND PROPERTY
645-11                    SUBCHAPTER A.  GENERAL PROVISIONS
645-12         Sec. 254.001.  APPLICABILITY OF CHAPTER.  This chapter
645-13   applies only to a municipality located on a channel, canal, bay,
645-14   inlet, or lake connected to the Gulf of Mexico.  (V.A.C.S.
645-15   Art. 969a-2, Sec. 2.)
645-16         Sec. 254.002.  DEFINITIONS.  In this chapter:
645-17               (1)  "Board" means a board of trustees established
645-18   under Section 254.021.
645-19               (2)  "Island property" means:
645-20                     (A)  land located on an island in the channel,
645-21   canal, bay, inlet, or lake on which the municipality is located;
645-22   and
645-23                     (B)  facilities and improvements related to land
645-24   described by Paragraph (A).
645-25               (3)  "Obligation" includes a bond.  (V.A.C.S.
645-26   Art. 969a-2, Secs. 1, 4 (part); New.)
645-27         Sec. 254.003.  AUTHORITY REGARDING ISLAND PROPERTY.  A
 646-1   municipality may construct, acquire, lease as lessor or lessee,
 646-2   improve, enlarge, extend, repair, maintain, replace, develop, or
 646-3   operate facilities and improvements necessary or convenient for the
 646-4   proper administration of island property owned by the municipality.
 646-5   (V.A.C.S. Art. 969a-2, Sec. 3.)
 646-6         Sec. 254.004.  APPLICABILITY OF OTHER LAW.  Except to the
 646-7   extent that it conflicts with this chapter, Subchapter B, Chapter
 646-8   1502, Government Code, applies to revenue obligations issued under
 646-9   this chapter, and a municipality to which this chapter applies has,
646-10   with respect to a revenue obligation issued under this chapter,
646-11   each power granted by that subchapter.  (V.A.C.S. Art. 969a-2, Sec.
646-12   11 (part).)
646-13            (Sections 254.005-254.020 reserved for expansion
646-14        SUBCHAPTER B.  MANAGEMENT AND CONTROL OF ISLAND PROPERTY;
646-15                            BOARD OF TRUSTEES
646-16         Sec. 254.021.  MANAGEMENT AND CONTROL BY GOVERNING BODY OR
646-17   BOARD OF TRUSTEES.  (a)  An ordinance authorizing the issuance of
646-18   obligations under this chapter may provide that, while the
646-19   principal of or interest on the obligations is outstanding,
646-20   management and control of island property owned by the municipality
646-21   and of the revenue generated by the island property is in:
646-22               (1)  the governing body of the municipality; or
646-23               (2)  a board of trustees named in the ordinance.
646-24         (b)  A board may consist of not more than nine members.
646-25         (c)  Notwithstanding Subsection (a), if the municipality is
646-26   operating under a home-rule charter that requires that island
646-27   property be managed or controlled by a board of trustees or
 647-1   commission, the charter controls and a reference in this chapter to
 647-2   a board of trustees is a reference to the board or commission
 647-3   provided in the charter.  (V.A.C.S. Art. 969a-2, Sec. 5(a) (part).)
 647-4         Sec. 254.022.  ORGANIZATION AND DUTIES OF BOARD.  (a)  Except
 647-5   as otherwise provided by a charter provision described by Section
 647-6   254.021(c), an ordinance under Section 254.021(a) that places
 647-7   management and control of island property in a board may:
 647-8               (1)  specify the board members' compensation;
 647-9               (2)  specify the members' terms of office;
647-10               (3)  specify the members' powers and duties;
647-11               (4)  provide for the election or appointment of the
647-12   members' successors; and
647-13               (5)  specify any other matter relating to the members'
647-14   organization and duties.
647-15         (b)  On any matter not covered by the ordinance or the
647-16   municipal charter, the board is governed by the laws and rules
647-17   governing the governing body of the municipality.  (V.A.C.S.
647-18   Art. 969a-2, Sec. 5(a) (part).)
647-19         Sec. 254.023.  CHARACTER OF BOARD; GENERAL POWERS.  (a)  A
647-20   board is a body politic and corporate.
647-21         (b)  The board may:
647-22               (1)  manage, control, maintain, and operate the island
647-23   property;
647-24               (2)  employ a general manager and any other officer,
647-25   employee, or representative the board considers appropriate;
647-26               (3)  prepare and adopt a budget, set charges for a
647-27   service or facility, authorize an expenditure, and manage and
 648-1   control the income and revenue of the island property;
 648-2               (4)  determine policies and adopt rules and procedures
 648-3   for the operation of the island property;
 648-4               (5)  acquire property or an interest in property to
 648-5   accomplish the purposes of this chapter and construct an
 648-6   improvement or facility on the property;
 648-7               (6)  contract in its own name, but not in the name of
 648-8   the municipality;
 648-9               (7)  sue and be sued in its own name;
648-10               (8)  adopt, use, and alter a corporate seal; and
648-11               (9)  establish a security force and commission as a
648-12   peace officer an employee of the force who is licensed by the
648-13   Commission on Law Enforcement Officer Standards and Education.
648-14         (c)  A person commissioned as a peace officer under this
648-15   chapter has each right, privilege, obligation, and duty of other
648-16   peace officers in this state while on the property under control of
648-17   the board or in the actual course and scope of the person's
648-18   employment.  (V.A.C.S. Art. 969a-2, Sec. 5(b) (part).)
648-19         Sec. 254.024.  COMPETITIVE BIDDING.  (a)  The board may award
648-20   a contract involving the expenditure of more than $15,000 only by
648-21   competitive bidding.
648-22         (b)  Competitive bidding is not required:
648-23               (1)  for a contract for:
648-24                     (A)  personal or professional services;
648-25                     (B)  a real estate transaction;
648-26                     (C)  operation of an improvement or facility
648-27   under a specific agreement for a limited term; or
 649-1                     (D)  insurance; or
 649-2               (2)  if the board determines that the delay posed by
 649-3   the competitive bidding procedure would prevent or substantially
 649-4   impair the operation of island property.  (V.A.C.S.  Art. 969a-2,
 649-5   Sec. 5(b) (part).)
 649-6            (Sections 254.025-254.050 reserved for expansion
 649-7                       SUBCHAPTER C.  OBLIGATIONS
 649-8         Sec. 254.051.  AUTHORITY OF MUNICIPALITY TO ISSUE
 649-9   OBLIGATIONS.  The governing body of a municipality by ordinance may
649-10   issue in the name of the municipality obligations payable from
649-11   taxes, revenue, or both to provide money for a facility or
649-12   improvement under this chapter.  (V.A.C.S. Art. 969a-2, Secs. 4
649-13   (part), 8(a) (part).)
649-14         Sec. 254.052.  ELECTION.  (a)  Obligations payable from ad
649-15   valorem taxes, other than refunding obligations, may be issued only
649-16   if authorized at an election held under Chapter 1251, Government
649-17   Code.
649-18         (b)  Notwithstanding any law or charter provision to the
649-19   contrary, an election is not required to authorize the issuance
649-20   under this chapter of obligations payable solely from revenue if:
649-21               (1)  the obligations are not:
649-22                     (A)  a debt of the municipality; or
649-23                     (B)  a pledge of the faith and credit of the
649-24   municipality; and
649-25               (2)  the owner or holder of an obligation is not
649-26   entitled to demand payment from money raised by taxation.
649-27   (V.A.C.S. Art. 969a-2, Sec. 4 (part).)
 650-1         Sec. 254.053.  AUTHORITY OF BOARD TO ISSUE OBLIGATIONS.  A
 650-2   board by resolution may issue in the name of the board, with the
 650-3   consent of the governing body of the municipality:
 650-4               (1)  obligations payable from revenue in the manner
 650-5   provided by this chapter and refund previously issued obligations;
 650-6               (2)  expense notes drawn against the revenues of the
 650-7   board to pay expenses during the fiscal year of the board in which
 650-8   the notes are issued; and
 650-9               (3)  certificates of participation in contractual
650-10   obligations to pay money.  (V.A.C.S. Art. 969a-2, Secs. 5(b)
650-11   (part), 8(b) (part).)
650-12         Sec. 254.054.  LIMITATION ON AGGREGATE AMOUNT OF EXPENSE
650-13   NOTES.  The aggregate amount of expense notes issued under Section
650-14   254.053(2) that are outstanding at any time during a fiscal year
650-15   may not exceed 50 percent of the difference between:
650-16               (1)  the revenue of the board budgeted for that fiscal
650-17   year; and
650-18               (2)  the principal of and interest on board obligations
650-19   other than expense notes to be paid from the revenue of the board
650-20   during that fiscal year.  (V.A.C.S. Art. 969a-2, Sec. 5(b) (part).)
650-21         Sec. 254.055.  MATURITY OF OBLIGATION.  An obligation issued
650-22   under this chapter must mature not later than 40 years after its
650-23   date of issuance.  (V.A.C.S. Art. 969a-2, Sec. 8(c) (part).)
650-24         Sec. 254.056.  SIGNATURES; SEAL.  (a)  An obligation issued
650-25   by a municipality under this chapter must be:
650-26               (1)  signed by the mayor or the presiding officer of
650-27   the municipality;
 651-1               (2)  countersigned by the municipality's secretary or
 651-2   clerk; and
 651-3               (3)  impressed with the seal of the municipality.
 651-4         (b)  An obligation authorized by the board under this chapter
 651-5   must be:
 651-6               (1)  signed by the presiding officer of the board;
 651-7               (2)  countersigned by the secretary or assistant
 651-8   secretary; and
 651-9               (3)  impressed with the seal of the board.  (V.A.C.S.
651-10   Art. 969a-2, Secs. 8(a) (part), (b) (part).)
651-11         Sec. 254.057.  SALE OF OBLIGATIONS.  (a)  A municipality or
651-12   board may sell obligations issued under this chapter at public or
651-13   private sale under terms the governing body or the board determines
651-14   to be the most advantageous and reasonably obtainable.
651-15         (b)  Subsection (a) applies to obligations payable from
651-16   revenue notwithstanding any restriction in a municipal charter to
651-17   the contrary.  (V.A.C.S. Art. 969a-2, Secs. 6(a) (part), 8(c)
651-18   (part).)
651-19         Sec. 254.058.  CONTENTS OF ORDINANCE OR RESOLUTION.  (a)  The
651-20   ordinance of the governing body or the resolution of the board
651-21   authorizing the issuance of revenue obligations may:
651-22               (1)  provide for the flow of funds, the establishment
651-23   and maintenance of an interest and sinking fund, reserve fund, or
651-24   other fund, and the depositing of money; and
651-25               (2)  contain any covenant, as considered appropriate,
651-26   with respect to the obligations, the pledged revenue, and the
651-27   operation and maintenance of the island property.
 652-1         (b)  The ordinance or resolution or another proceeding may:
 652-2               (1)  prohibit the further issuance of obligations
 652-3   payable from the pledged revenue; or
 652-4               (2)  reserve the right to issue additional obligations
 652-5   to be secured by a pledge of and payable from the net revenue on a
 652-6   parity with, or subordinate to, the lien and pledge securing the
 652-7   obligations being issued, subject to any condition provided by the
 652-8   ordinance, resolution, or other proceeding.
 652-9         (c)  The ordinance, resolution, or other proceeding may:
652-10               (1)  provide that surplus net revenue received from the
652-11   operation of the island property may be used for the payment of the
652-12   principal of  and interest on any obligations payable from taxes
652-13   issued by the municipality under this chapter; and
652-14               (2)  contain other provisions and covenants.  (V.A.C.S.
652-15   Art. 969a-2, Sec. 7.)
652-16         Sec. 254.059.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
652-17   REVENUE OBLIGATIONS.  (a)  If revenue obligations issued under this
652-18   chapter state that  they are secured by a pledge of the proceeds
652-19   from a contract, a copy of the contract and of the proceedings
652-20   authorizing the contract must be submitted to the attorney general
652-21   for approval.
652-22         (b)  The approval by the attorney general of the obligations
652-23   is approval of the contract.
652-24         (c)  After approval, the contract is incontestable except for
652-25   forgery or fraud.  (V.A.C.S. Art. 969a-2, Sec. 8(d) (part).)
652-26         Sec. 254.060.  SECURITY FOR AND PAYMENT OF OBLIGATIONS
652-27   PAYABLE FROM REVENUE.  (a)  Revenue obligations issued under this
 653-1   chapter may be secured solely by and paid from a pledge of the net
 653-2   revenue derived from the operation of island property, including
 653-3   revenue from leases, subleases, sales, or contracts for sale
 653-4   entered into by the municipality or the board of trustees with
 653-5   respect to the island property.  For purposes of this subsection,
 653-6   the net revenue is an amount equal to the gross revenue derived
 653-7   from the operation of the island property less the reasonable
 653-8   expenses of maintaining and operating the island property.
 653-9         (b)  While the principal of  or interest on obligations is
653-10   outstanding, the issuer shall:
653-11               (1)  impose and collect charges in an amount sufficient
653-12   to pay:
653-13                     (A)  maintenance and operation expenses of the
653-14   island property;
653-15                     (B)  the interest on the obligations as it
653-16   accrues; and
653-17                     (C)  the principal of the obligations as the
653-18   obligations mature; and
653-19               (2)  make any other payment prescribed by the ordinance
653-20   or resolution authorizing or other proceeding relating to the
653-21   issuance of the obligations.
653-22         (c)  In addition to the security provided by Subsection (a),
653-23   obligations may be secured by a trust indenture and a mortgage or
653-24   deed of trust lien or other security interest on island property.
653-25   (V.A.C.S. Art. 969a-2, Secs. 6(a) (part), (b) (part).)
653-26         Sec. 254.061.  USE OF CERTAIN PROCEEDS.  From the proceeds
653-27   from the sale of obligations issued under this chapter, there may
 654-1   be appropriated or set aside:
 654-2               (1)  an amount for the payment of interest expected to
 654-3   accrue while an island property facility or improvement is under
 654-4   construction;
 654-5               (2)  an amount necessary to pay expenses related to the
 654-6   issuance, sale, and delivery of the obligations; and
 654-7               (3)  an amount required by the ordinance or resolution
 654-8   authorizing the issuance of the obligations to be deposited to the
 654-9   credit of a reserve or other fund.  (V.A.C.S. Art. 969a-2, Sec. 9.)
654-10         Sec. 254.062.  LEASE OR SALE OF ISLAND PROPERTY.  (a)  In
654-11   connection with the issuance of revenue obligations, a municipality
654-12   or board may lease, sublease, or sell island property to be
654-13   constructed or acquired with the proceeds of the obligations.
654-14         (b)  A lease, sublease, or contract of sale may contain any
654-15   provision that the municipality or board considers advantageous.
654-16         (c)  A lease, sublease, or contract of sale may provide for
654-17   the lessee or purchaser of the island property to make payments in
654-18   amounts adequate to pay the principal of and interest and premium
654-19   on the obligations when they become due.  (V.A.C.S. Art. 969a-2,
654-20   Sec. 6(b) (part).)
654-21         Sec. 254.063.  ENCUMBRANCE OF ISLAND PROPERTY IMPROVEMENTS OR
654-22   FACILITIES FINANCED BY OBLIGATIONS PAYABLE FROM AD VALOREM TAXES.
654-23   A municipality may not encumber an island property improvement or
654-24   facility financed by obligations payable from ad valorem taxes
654-25   unless authorized at the election required by Section 254.052.
654-26   (V.A.C.S. Art. 969a-2, Sec. 11 (part).)
654-27            (Sections 254.064-254.080 reserved for expansion
 655-1                  SUBCHAPTER D.  REFUNDING OBLIGATIONS
 655-2         Sec. 254.081.  APPLICABILITY OF LAW RELATING TO ORIGINAL
 655-3   OBLIGATIONS.  The provisions of this chapter relating to original
 655-4   obligations apply to  refunding obligations issued under this
 655-5   chapter  to the extent the provisions can be made to apply.
 655-6   (V.A.C.S. Art. 969a-2, Sec. 10(e).)
 655-7         Sec. 254.082.  AUTHORITY TO ISSUE TAX REFUNDING OBLIGATIONS.
 655-8   The governing body of a municipality may issue tax obligations
 655-9   under this chapter to refund outstanding tax obligations.
655-10   (V.A.C.S. Art. 969a-2, Sec. 10(a).)
655-11         Sec. 254.083.  AUTHORITY TO ISSUE REVENUE REFUNDING
655-12   OBLIGATIONS.  The governing body of a municipality or a board with
655-13   the approval of the governing body may issue revenue obligations
655-14   under this chapter to refund outstanding revenue obligations.
655-15   (V.A.C.S. Art. 969a-2, Sec. 10(b) (part).)
655-16         Sec. 254.084.  TERMS OF ISSUANCE OF REVENUE REFUNDING
655-17   OBLIGATIONS.  (a)  Revenue refunding obligations may:
655-18               (1)  be combined with new or original revenue
655-19   obligations into one series or issue;
655-20               (2)  be issued to refund obligations of more than one
655-21   series or issue;
655-22               (3)  combine the pledges securing the obligations to be
655-23   refunded to secure the revenue refunding obligations; or
655-24               (4)  be secured by a pledge of other or additional net
655-25   revenue.
655-26         (b)  A revenue refunding obligation may bear interest at a
655-27   rate higher than that of the obligation to be refunded.   (V.A.C.S.
 656-1   Art. 969a-2, Sec. 10(b) (part).)
 656-2         Sec. 254.085.  REGISTRATION OF REFUNDING OBLIGATIONS BY
 656-3   COMPTROLLER.  (a)  Except as provided by Subsection (b), the
 656-4   comptroller shall register refunding obligations on surrender and
 656-5   cancellation of the obligations to be refunded.
 656-6         (b)  The comptroller shall register refunding obligations
 656-7   without the surrender and cancellation of the obligations to be
 656-8   refunded if:
 656-9               (1)  the ordinance or resolution authorizing the
656-10   issuance of the refunding obligations requires that:
656-11                     (A)  the obligations be sold at public or private
656-12   sale; and
656-13                     (B)  the proceeds from the sale be deposited:
656-14                           (i)  in a place where the obligations to be
656-15   refunded are payable; or
656-16                           (ii)  with the comptroller; and
656-17               (2)  the refunding obligations are issued in an amount
656-18   sufficient to pay the principal of and interest on the obligations
656-19   to be refunded to the option or maturity date of the obligations.
656-20   (V.A.C.S. Art. 969a-2, Sec. 10(c) (part).)
656-21         Sec. 254.086.  ESCROW AGREEMENT.  (a)  The proceeds from
656-22   revenue refunding obligations that are deposited as provided by
656-23   Section 254.085(b)(1)(B) shall be held under an escrow agreement so
656-24   that the proceeds and interest earned on the proceeds will be
656-25   available to pay the principal of and interest on the obligations
656-26   to be refunded as each becomes due.
656-27         (b)  The escrow agreement may provide that the proceeds may,
 657-1   until needed to pay principal and interest, be invested in direct
 657-2   obligations of the United States.
 657-3         (c)  Interest earned on an investment described by Subsection
 657-4   (b) may be:
 657-5               (1)  pledged to the payment of the principal of and
 657-6   interest on the obligations to be refunded or the refunding
 657-7   obligations; or
 657-8               (2)  considered as revenue of the island property.
 657-9   (V.A.C.S. Art. 969a-2, Sec. 10(c) (part).)
657-10         SECTION 10.  CONFORMING AMENDMENT.  Chapter 280, Local
657-11   Government Code, is amended by adding Section 280.003 to read as
657-12   follows:
657-13         Sec. 280.003.  HOSPITAL SITES IN COUNTY OR MUNICIPALITY.  (a)
657-14   The commissioners court of a county or the governing body of a
657-15   municipality may issue bonds that are payable from ad valorem taxes
657-16   and use the proceeds from the sale of the bonds to acquire by
657-17   purchase, condemnation, or both, land to be used for hospital
657-18   purposes.
657-19         (b)  A county or municipality that has sufficient money in
657-20   its general fund may use money in that fund to acquire land to be
657-21   used for hospital purposes.
657-22         (c)  A county or municipality that owns land suitable for
657-23   hospital purposes, including land acquired under Subsection (a) or
657-24   (b), may donate the land to this state or to the United States for
657-25   hospital purposes if this state or the United States agrees to
657-26   erect and maintain a hospital on the land.
657-27         (d)  A county or municipality may accept a nominal award as
 658-1   full compensation for land that is suitable for hospital purposes
 658-2   in a condemnation proceeding brought by this state or by the United
 658-3   States to acquire the land for hospital purposes.
 658-4         (e)  If bonds are issued under Subsection (a), the
 658-5   commissioners court or the governing body must impose the taxes in
 658-6   compliance with the applicable provisions of Subtitles A and C,
 658-7   Title 9, Government Code.  (V.A.C.S. Art. 835c (part).)
 658-8         SECTION 11.  CONFORMING AMENDMENT.  Subtitle C, Title 9,
 658-9   Local Government Code, is amended by adding Chapter 303 to read as
658-10   follows:
658-11                CHAPTER 303. PUBLIC FACILITY CORPORATIONS
658-12                    SUBCHAPTER A.  GENERAL PROVISIONS
658-13         Sec. 303.001.  SHORT TITLE.  This chapter may be cited as the
658-14   Public Facility Corporation Act.  (V.A.C.S. Art. 717s, Sec. 1.001.)
658-15         Sec. 303.002.  PURPOSE; CONSTRUCTION.  (a)  The purpose of
658-16   this chapter is to authorize the creation and use of public
658-17   facility corporations with the broadest possible powers to finance
658-18   or to provide for the acquisition, construction, rehabilitation,
658-19   renovation, repair, equipping, furnishing, and placement in service
658-20   of public facilities in an orderly, planned manner and at the
658-21   lowest possible borrowing costs.
658-22         (b)  The legislature intends that a corporation created under
658-23   this chapter be a public corporation, constituted authority, and
658-24   instrumentality authorized to issue bonds on behalf of its sponsor
658-25   for the purposes of Section 103, Internal Revenue Code of 1986 (26
658-26   U.S.C. Section 103).  This chapter and the rules and rulings issued
658-27   under this chapter shall be construed according to this intent.
 659-1   (V.A.C.S.  Art. 717s, Sec. 1.002.)
 659-2         Sec. 303.003.  DEFINITIONS.  In this chapter:
 659-3               (1)  "Board of directors" means the board of directors
 659-4   of a corporation.
 659-5               (2)  "Bonds" includes notes, interim certificates, or
 659-6   other evidences of indebtedness of a corporation issued or incurred
 659-7   under this chapter.
 659-8               (3)  "Corporation" means a public facility corporation
 659-9   created and existing under this chapter.
659-10               (4)  "Credit agreement" means a loan agreement,
659-11   revolving credit agreement, agreement establishing a line of
659-12   credit, letter of credit, reimbursement agreement, insurance
659-13   contract, commitment to purchase bonds or sponsor obligations,
659-14   purchase or sale agreement, or commitment or other contract or
659-15   agreement authorized and approved by the board of directors of a
659-16   corporation in connection with the authorization, issuance,
659-17   incurrence, sale, security, exchange, payment, purchase, or
659-18   redemption of bonds or interest on bonds.
659-19               (5)  "Director" means a member of a board of directors.
659-20               (6)  "Housing authority" means a public corporation
659-21   created under Chapter 392.
659-22               (7)  "Public facility" means any real, personal, or
659-23   mixed property, or an interest in property devoted or to be devoted
659-24   to public use, and authorized to be financed, refinanced, or
659-25   provided by sponsor obligations.
659-26               (8)  "Resolution" means a resolution, order, ordinance,
659-27   or other official action by the governing body of a sponsor.
 660-1               (9)  "School district" means a political subdivision
 660-2   created under Section 3, Article VII, Texas Constitution.
 660-3               (10)  "Special district" means:
 660-4                     (A)  a district created under Section 52, Article
 660-5   III, or Section 59, Article XVI, Texas Constitution;
 660-6                     (B)  a hospital district or authority; or
 660-7                     (C)  a junior college district authorized by
 660-8   Chapter 130, Education Code.
 660-9               (11)  "Sponsor" means a municipality, county, school
660-10   district, housing authority, or special district that causes a
660-11   corporation to be created to act in accordance with this chapter.
660-12               (12)  "Sponsor obligation" means an evidence of
660-13   indebtedness or obligation that a sponsor issues or incurs to
660-14   finance, refinance, or provide a public facility, including bonds,
660-15   notes, warrants, certificates of obligation, leases, and contracts
660-16   authorized by Section 303.041 and Subchapter C.  (V.A.C.S.
660-17   Art. 717s, Secs.  1.003(1), (2), (4), (7), (8), (9), (10), (11),
660-18   (12), (13), (14), (15).)
660-19         Sec. 303.004.  ADOPTION OF ALTERNATE PROCEDURE IN CASE OF
660-20   CONSTITUTIONAL VIOLATION.  If a court holds that a procedure under
660-21   this chapter violates the  federal or state constitution, a
660-22   corporation or its sponsor by resolution may provide an alternate
660-23   procedure that conforms to the constitution.  (V.A.C.S. Art. 717s,
660-24   Sec. 1.004.)
660-25         Sec. 303.005.  EFFECT OF CHAPTER ON OTHER LAW.  (a)  This
660-26   chapter does not limit the police power provided by law to this
660-27   state or a municipality or other political subdivision of this
 661-1   state, or an official or agency of this state or of a municipality
 661-2   or other political subdivision of this state, over property of a
 661-3   corporation.
 661-4         (b)  A sponsor or corporation may use other law not in
 661-5   conflict with this chapter to the extent convenient or necessary to
 661-6   carry out a power expressly or impliedly granted by this chapter.
 661-7   (V.A.C.S.  Art. 717s, Sec. 1.005.)
 661-8         Sec. 303.006.  LIMITATION OF CHAPTER.  This chapter does not
 661-9   authorize a sponsor to issue a sponsor obligation, use a letter of
661-10   credit, or mortgage a public facility.  (V.A.C.S. Art. 717s, Sec.
661-11   4.043(a) (part).)
661-12            (Sections 303.007-303.020 reserved for expansion
661-13                SUBCHAPTER B.  CREATION AND OPERATION OF
661-14                       PUBLIC FACILITY CORPORATION
661-15         Sec. 303.021.  AUTHORITY TO CREATE.  (a)  A sponsor may
661-16   create one or more nonmember, nonstock, nonprofit public facility
661-17   corporations to:
661-18               (1)  issue bonds under this chapter to purchase sponsor
661-19   obligations;
661-20               (2)  finance public facilities on behalf of its
661-21   sponsor; or
661-22               (3)  loan the proceeds of the obligations to other
661-23   entities to accomplish the purposes of the sponsor.
661-24         (b)  A sponsor may use the corporation to:
661-25               (1)  acquire, construct, rehabilitate, renovate,
661-26   repair, equip, furnish, or place in service public facilities; or
661-27               (2)  issue bonds on the sponsor's behalf to finance the
 662-1   costs of the public facilities.  (V.A.C.S. Art. 717s, Secs.
 662-2   2.011(a), (b).)
 662-3         Sec. 303.022.  CREATION UNDER OTHER LAW.  A nonprofit
 662-4   corporation created by a housing authority under the Texas
 662-5   Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's
 662-6   Texas Civil Statutes) is considered a corporation under this
 662-7   chapter and has the rights and powers necessary or convenient to
 662-8   accomplish a corporation's purposes under this chapter.  (V.A.C.S.
 662-9   Art. 717s, Sec. 3.021(j).)
662-10         Sec. 303.023.  PROCEDURE.  A governing body of a sponsor that
662-11   determines that it is in the public interest and to the benefit of
662-12   the sponsor's residents and the citizens of this state that a
662-13   corporation be created to finance, refinance, or provide the costs
662-14   of public facilities of the sponsor may by resolution stating that
662-15   determination:
662-16               (1)  authorize and approve the creation of a
662-17   corporation to act on behalf of the sponsor; and
662-18               (2)  approve proposed articles of incorporation for the
662-19   corporation.  (V.A.C.S. Art. 717s, Sec. 3.021(a).)
662-20         Sec. 303.024.  ARTICLES OF INCORPORATION.  (a)  The articles
662-21   of incorporation of the corporation must include:
662-22               (1)  the corporation's name;
662-23               (2)  a statement that the corporation is a nonprofit
662-24   public corporation;
662-25               (3)  the duration of the corporation, which may be
662-26   perpetual;
662-27               (4)  a statement that the purpose of the corporation is
 663-1   to assist its sponsor in financing, refinancing, or providing
 663-2   public facilities;
 663-3               (5)  a statement that the corporation has no members
 663-4   and is a nonstock corporation;
 663-5               (6)  the street address of the corporation's initial
 663-6   registered office and the name of its initial registered agent at
 663-7   that address;
 663-8               (7)  the number of directors on the initial board of
 663-9   directors and those directors' names and addresses;
663-10               (8)  each incorporator's name and street address;
663-11               (9)  the sponsor's name and address; and
663-12               (10)  a statement that the sponsor has specifically
663-13   authorized the corporation to act on its behalf to further the
663-14   public purpose set forth in the articles of incorporation and has
663-15   approved the articles of incorporation.
663-16         (b)  The corporate powers listed in this chapter are not
663-17   required to be included in the articles of incorporation.
663-18         (c)  The articles of incorporation may include provisions for
663-19   the regulation of the internal affairs of the corporation,
663-20   including a provision required or permitted by this chapter to be
663-21   in the bylaws.
663-22         (d)  Unless the articles of incorporation provide that a
663-23   change in the number of directors may be made only by amendment to
663-24   those articles, a change may be made by amendment to the bylaws.
663-25         (e)  A provision of the articles of incorporation that
663-26   requires the vote or concurrence of a greater proportion of the
663-27   board of directors than this chapter controls over this chapter.
 664-1   (V.A.C.S. Art. 717s, Secs. 3.021(b), (c), (d), (e), (f); 3.033(d)
 664-2   (part).)
 664-3         Sec. 303.025.  CERTIFICATE OF INCORPORATION; BEGINNING OF
 664-4   CORPORATE EXISTENCE.  (a)  The incorporators shall deliver to the
 664-5   secretary of state the original and two copies of the articles of
 664-6   incorporation and a certified copy of the resolution of the
 664-7   sponsor's governing body approving the articles of incorporation.
 664-8         (b)  If the secretary of state finds that the articles of
 664-9   incorporation comply with this chapter and have been approved by
664-10   the sponsor's governing body, the secretary of state, on payment of
664-11   the fees required by this chapter, shall:
664-12               (1)  write "filed" on the original and each copy of the
664-13   articles of incorporation and the month, day, and year of the
664-14   filing;
664-15               (2)  file the original in the office of the secretary
664-16   of state; and
664-17               (3)  issue two certificates of incorporation with a
664-18   copy of the articles of incorporation attached to each.
664-19         (c)  The secretary of state shall deliver a certificate of
664-20   incorporation, with a copy of the articles of incorporation
664-21   attached, to the incorporators or their representatives and to the
664-22   sponsor's governing body.
664-23         (d)  The corporation's existence begins on issuance of the
664-24   certificate of incorporation.
664-25         (e)  The certificate of incorporation is conclusive evidence
664-26   that all conditions precedent required to be performed by the
664-27   incorporators and by the sponsor have been performed and that the
 665-1   corporation has been incorporated under this chapter.  (V.A.C.S.
 665-2   Art. 717s, Secs. 3.021(g), (h), (i).)
 665-3         Sec. 303.026.  ORGANIZATIONAL MEETING.  (a)  After issuance
 665-4   of the certificate of incorporation and at the call of a  majority
 665-5   of the incorporators, the board of directors named in the articles
 665-6   of incorporation shall hold an organizational meeting in this state
 665-7   to adopt bylaws, to elect officers, and for any other purpose.
 665-8         (b)  Not later than the sixth day before the date of the
 665-9   meeting, the incorporators shall mail, postage prepaid, notice to
665-10   each director of the time and place of the meeting.  (V.A.C.S.
665-11   Art. 717s, Sec. 3.022.)
665-12         Sec. 303.027.  AMENDMENT OF ARTICLES OF INCORPORATION.  (a)
665-13   Articles of incorporation may be amended to contain a provision
665-14   that is lawful under this chapter if the sponsor's governing body
665-15   by appropriate resolution determines that the amendment is
665-16   advisable and authorizes or directs that an amendment be made.
665-17         (b)  The corporation's president or vice president and the
665-18   secretary or clerk of the sponsor's governing body shall execute
665-19   articles of amendment on behalf of the corporation.  An officer
665-20   signing the articles of amendment shall verify those articles.
665-21         (c)  The articles of amendment must include:
665-22               (1)  the name of the corporation;
665-23               (2)  if the amendment alters a provision of the
665-24   original or amended articles of incorporation, an identification by
665-25   reference or description of the altered provision and a statement
665-26   of its text as amended;
665-27               (3)  if the amendment is an addition to the original or
 666-1   amended articles of incorporation, a statement of that fact and the
 666-2   full text of each provision;
 666-3               (4)  the name and address of the sponsor;
 666-4               (5)  a statement that the amendment was authorized by
 666-5   the sponsor's governing body; and
 666-6               (6)  the date of the meeting at which the governing
 666-7   body adopted or approved the amendment.  (V.A.C.S. Art. 717s, Secs.
 666-8   3.023(a), (b), (c).)
 666-9         Sec. 303.028.  CERTIFICATE OF AMENDMENT.  (a)  The original
666-10   and two copies of the articles of amendment and a certified copy of
666-11   the resolution of the sponsor's governing body authorizing the
666-12   articles shall be delivered to the secretary of state.
666-13         (b)  If the secretary of state finds that the articles of
666-14   amendment comply with this chapter and are authorized by the
666-15   sponsor's governing body, the secretary of state, on payment of the
666-16   fees required by this chapter, shall:
666-17               (1)  write "filed" on the original and on each copy of
666-18   the articles of amendment and the month, day, and year of the
666-19   filing;
666-20               (2)  file the original in the office of the secretary
666-21   of state; and
666-22               (3)  issue two certificates of amendment with a copy of
666-23   the articles of amendment attached to each.
666-24         (c)  The secretary of state shall deliver to the corporation
666-25   or its representative and to the sponsor's governing body a
666-26   certificate of amendment with a copy of the articles of amendment
666-27   attached.
 667-1         (d)  The amendment to the articles of incorporation takes
 667-2   effect on issuance of the certificate of amendment.
 667-3         (e)  An amendment does not affect an existing cause of action
 667-4   in favor of or against the corporation, a pending suit to which the
 667-5   corporation is a party, or an existing right of a person.  Change
 667-6   of the corporate name by amendment does not abate a suit brought by
 667-7   or against the corporation under its former name.  (V.A.C.S.
 667-8   Art. 717s, Secs.  3.023(d), (e), (f), (g).)
 667-9         Sec. 303.029.  RESTATED ARTICLES OF INCORPORATION.  (a)  A
667-10   corporation may authorize, execute, and file restated articles of
667-11   incorporation by following the procedure to amend articles of
667-12   incorporation, including obtaining authorization from the sponsor's
667-13   governing body.
667-14         (b)  The restated articles of incorporation must restate the
667-15   entire text of the articles of incorporation as amended or
667-16   supplemented by all previous certificates of amendment.  The
667-17   restated articles of incorporation may also contain further
667-18   amendments to the articles of incorporation.
667-19         (c)  Unless the restated articles of incorporation include
667-20   amendments that were not previously in the articles of
667-21   incorporation and previous certificates of amendment, the
667-22   introductory paragraph of the restated articles of incorporation
667-23   must contain a statement that the instrument accurately copies the
667-24   articles of incorporation and all amendments that are in effect on
667-25   the date of filing without further changes, except that:
667-26               (1)  the number of directors then constituting the
667-27   board of directors and those directors' names and addresses may be
 668-1   inserted in place of the similar information concerning the initial
 668-2   board of directors; and
 668-3               (2)  the incorporators' names and addresses may be
 668-4   omitted.
 668-5         (d)  If the restated articles of incorporation contain
 668-6   further amendments not included in the articles of incorporation
 668-7   and previous certificates of amendment, the instrument containing
 668-8   the restated articles of incorporation must:
 668-9               (1)  include for each further amendment a statement
668-10   that the amendment has been made in conformity with this chapter;
668-11               (2)  include the statements required by this chapter to
668-12   be contained in articles of amendment, except that the full text of
668-13   the amendment need not be included except in the restated articles
668-14   of incorporation;
668-15               (3)  contain a statement that the instrument accurately
668-16   copies the articles of incorporation and all previous amendments in
668-17   effect on the date of the filing, as further amended by the
668-18   restated articles of incorporation, and that the instrument does
668-19   not contain any other change, except that:
668-20                     (A)  the number of directors then constituting
668-21   the board of directors and those directors' names and addresses may
668-22   be inserted in place of the similar information concerning the
668-23   initial board of directors; and
668-24                     (B)  the incorporators' names and addresses may
668-25   be omitted; and
668-26               (4)  restate the entire text of the articles of
668-27   incorporation as amended and supplemented by all previous
 669-1   certificates of amendment and as further amended by the restated
 669-2   articles of incorporation.  (V.A.C.S. Art. 717s, Secs. 3.024(a),
 669-3   (b), (c), (d).)
 669-4         Sec. 303.030.  RESTATED CERTIFICATE OF INCORPORATION.  (a)
 669-5   The original and two copies of the restated articles of
 669-6   incorporation and a certified copy of the resolution of the
 669-7   sponsor's governing body authorizing the articles shall be
 669-8   delivered to the secretary of state.
 669-9         (b)  If the secretary of state finds that the restated
669-10   articles of incorporation comply with this chapter and have been
669-11   authorized by the sponsor's governing body, the secretary of state,
669-12   on payment of the fees required by this chapter, shall:
669-13               (1)  write "filed" on the original and each copy of the
669-14   restated articles of incorporation and the month, day, and year of
669-15   the filing;
669-16               (2)  file the original in the office of the secretary
669-17   of state; and
669-18               (3)  issue two restated certificates of incorporation
669-19   with a copy of the restated articles of incorporation attached to
669-20   each.
669-21         (c)  The secretary of state shall deliver a restated
669-22   certificate of incorporation, with a copy of the restated articles
669-23   of incorporation attached, to the corporation or its representative
669-24   and to the sponsor's governing body.
669-25         (d)  On the issuance by the secretary of state of the
669-26   restated certificate of incorporation, the original articles of
669-27   incorporation and all amendments are superseded, and the restated
 670-1   articles of incorporation become the corporation's articles of
 670-2   incorporation.  (V.A.C.S. Art. 717s, Secs. 3.024(e), (f), (g).)
 670-3         Sec. 303.031.  REGISTERED OFFICE AND AGENT.  (a)  A
 670-4   corporation shall continuously maintain a registered office and
 670-5   registered agent in this state.
 670-6         (b)  The registered office shall be the same as the
 670-7   corporation's principal office.  The registered agent may be:
 670-8               (1)  an individual resident of this state whose
 670-9   business office is the same as the registered office; or
670-10               (2)  a domestic or foreign profit or nonprofit
670-11   corporation that is authorized to transact business or conduct
670-12   affairs in this state and that has a principal or business office
670-13   that is the same as the registered office.  (V.A.C.S. Art. 717s,
670-14   Sec. 3.025.)
670-15         Sec. 303.032.  CHANGE OF REGISTERED OFFICE OR AGENT.  (a)  A
670-16   corporation may change its registered office, registered agent, or
670-17   both by filing the original and a copy of a statement in the office
670-18   of the secretary of state.  The president or vice president of the
670-19   corporation shall execute and verify the statement.
670-20         (b)  The statement must include:
670-21               (1)  the corporation's name;
670-22               (2)  the post office address of the corporation's
670-23   current registered office;
670-24               (3)  if the registered office is to be changed, the
670-25   post office address of the corporation's new registered office;
670-26               (4)  the name of the corporation's registered agent;
670-27               (5)  if the registered agent is to be changed, the name
 671-1   of the successor registered agent;
 671-2               (6)  a statement that, after the change, the post
 671-3   office address of the registered office will be the same as the
 671-4   post office address of the business office of the registered agent;
 671-5   and
 671-6               (7)  a statement that the change was authorized by the
 671-7   board of directors or by a corporate officer authorized by the
 671-8   board of directors to make the change.
 671-9         (c)  If the secretary of state finds that the statement
671-10   complies with this chapter, the secretary of state, when all fees
671-11   have been paid as required by this chapter, shall:
671-12               (1)  write "filed" on the original and each copy of the
671-13   statement and the month, day, and year of the filing;
671-14               (2)  file the original statement in the office of the
671-15   secretary of state; and
671-16               (3)  return the copy of the statement to the
671-17   corporation or its representative.
671-18         (d)  The change made by the statement takes effect on the
671-19   filing of the statement.  (V.A.C.S. Art. 717s, Secs. 3.026(a), (b),
671-20   (c), (d).)
671-21         Sec. 303.033.  RESIGNATION OF REGISTERED AGENT.  (a)  A
671-22   registered agent of a corporation may resign by:
671-23               (1)  mailing or delivering written notice to the
671-24   corporation; and
671-25               (2)  filing the original and two copies of the notice
671-26   in the office of the secretary of state not later than the 10th day
671-27   after the date the notice is mailed or delivered to the
 672-1   corporation.
 672-2         (b)  The notice must include:
 672-3               (1)  the corporation's last known address;
 672-4               (2)  a statement that written notice was given to the
 672-5   corporation; and
 672-6               (3)  the date the written notice was given to the
 672-7   corporation.
 672-8         (c)  If the secretary of state finds that the notice complies
 672-9   with this chapter, the secretary of state, on payment of all fees
672-10   required by this chapter, shall:
672-11               (1)  write "filed" on the original notice and both
672-12   copies and the month, day, and year of the filing;
672-13               (2)  file the original notice in the office of the
672-14   secretary of state;
672-15               (3)  return one copy of the notice to the resigning
672-16   registered agent; and
672-17               (4)  deliver one copy of the notice to the corporation
672-18   at the address shown in the notice.
672-19         (d)  The resignation takes effect on the 31st day after the
672-20   date the notice is received by the secretary of state.  (V.A.C.S.
672-21   Art. 717s, Secs. 3.026(e), (f), (g).)
672-22         Sec. 303.034.  AGENTS FOR SERVICE.  (a)  The president, each
672-23   vice president, and the registered agent of a corporation are the
672-24   corporation's agents on whom a process, notice, or demand required
672-25   or permitted by law to be served on the corporation may be served.
672-26         (b)  If a corporation does not appoint or maintain a
672-27   registered agent in this state or if the registered agent cannot
 673-1   with reasonable diligence be found at the registered office, the
 673-2   secretary of state is an agent of the corporation on whom a
 673-3   process, notice, or demand may be served.
 673-4         (c)  The secretary of state may be served by delivering two
 673-5   copies of the process, notice, or demand to the secretary of state,
 673-6   the assistant secretary of state, or a clerk in charge of the
 673-7   corporation department of the secretary of state's office.  The
 673-8   secretary of state shall immediately forward one copy of the
 673-9   process, notice, or demand by registered mail to the corporation at
673-10   its registered office.
673-11         (d)  Service on the secretary of state is returnable not
673-12   earlier than the 30th day after the date of service.
673-13         (e)  The secretary of state shall keep a record of each
673-14   process, notice, and demand served, including the time of the
673-15   service and the action of the secretary of state in reference to
673-16   the process, notice, or demand.  (V.A.C.S. Art. 717s, Sec. 3.027.)
673-17         Sec. 303.035.  BOARD.  (a)  A corporation's affairs are
673-18   governed by a board of directors composed of at least three
673-19   individuals appointed by the sponsor's governing body.  Directors
673-20   may be divided into classes.
673-21         (b)  A director serves for a term of not more than six years.
673-22   The terms of directors of different classes may be of different
673-23   lengths.
673-24         (c)  A director holds office for the term to which the
673-25   director is appointed and until a successor is appointed and has
673-26   qualified.
673-27         (d)  The sponsor's governing body may remove a director for
 674-1   cause or at any time without cause.
 674-2         (e)  A director serves without compensation but is entitled
 674-3   to reimbursement for actual expenses incurred in the  performance
 674-4   of duties under this chapter.  (V.A.C.S. Art. 717s, Secs. 3.028(a),
 674-5   (b), (c), (d), (e).)
 674-6         Sec. 303.036.  OFFICERS.  (a)  The officers of a corporation
 674-7   are:
 674-8               (1)  the president, vice president, and secretary; and
 674-9               (2)  other officers, including a treasurer, and
674-10   assistant officers considered necessary.
674-11         (b)  An officer is elected or appointed at the time, in the
674-12   manner, and for the term provided by the articles of incorporation
674-13   or bylaws, except that an officer's term may not exceed three
674-14   years.  If the articles of incorporation or bylaws do not contain
674-15   those requirements, the board of directors shall elect or appoint
674-16   each officer annually.
674-17         (c)  A person may simultaneously hold more than one office,
674-18   except that the same person may not simultaneously hold the offices
674-19   of president and secretary.
674-20         (d)  An officer may be removed by the persons authorized to
674-21   elect or appoint the officer if those persons believe the best
674-22   interests of the corporation will be served by the removal.
674-23         (e)  A director who is a member of the governing body or an
674-24   officer or employee of the sponsor is eligible to serve as an
674-25   officer of the corporation.  (V.A.C.S. Art. 717s, Sec. 3.029.)
674-26         Sec. 303.037.  INDEMNIFICATION.  (a)  Except as provided by
674-27   Subsection (c), a corporation may indemnify a director, officer,
 675-1   employee, or agent or former director, officer, employee, or agent
 675-2   for expenses and costs, including attorney's fees, actually or
 675-3   necessarily incurred by the person in connection with a claim
 675-4   asserted against the person, by action in court or another forum,
 675-5   because of the person's being or having been a director, officer,
 675-6   employee, or agent.
 675-7         (b)  Except as provided by Subsection (c), if a corporation
 675-8   has not fully indemnified a director, officer, employee, or agent
 675-9   of the corporation under Subsection (a), the court in a proceeding
675-10   in which a claim is asserted against the director, officer,
675-11   employee, or agent of the corporation or a court having
675-12   jurisdiction over an action brought by the director, officer,
675-13   employee, or agent on a claim for indemnity may assess indemnity
675-14   against the corporation or its receiver or trustee.  The assessment
675-15   must equal:
675-16               (1)  the amount that the director, officer, employee,
675-17   or agent paid to satisfy the judgment or compromise the claim, not
675-18   including any amount paid the corporation; and
675-19               (2)  to the extent the court considers reasonable and
675-20   equitable, the expenses and costs, including attorney's fees,
675-21   actually and necessarily incurred by the director, officer,
675-22   employee, or agent in connection with the claim.
675-23         (c)  A corporation may not provide indemnity in a matter if
675-24   the director, officer, employee, or agent is guilty of negligence
675-25   or misconduct in relation to the matter.  A court may not assess
675-26   indemnity unless it finds that the director, officer, employee, or
675-27   agent was not guilty of negligence or misconduct in relation to the
 676-1   matter in which indemnity is sought.  (V.A.C.S. Art. 717s, Sec.
 676-2   3.030.)
 676-3         Sec. 303.038.  BYLAWS.  (a)  The board of directors shall
 676-4   adopt a corporation's initial bylaws and may amend or repeal the
 676-5   bylaws or adopt new bylaws.  The bylaws and each amendment and
 676-6   repeal of the bylaws must be approved by the sponsor's governing
 676-7   body by resolution.
 676-8         (b)  The bylaws may contain any provision for the regulation
 676-9   and management of the corporation's affairs consistent with law and
676-10   the articles of incorporation.  (V.A.C.S. Art. 717s, Sec. 3.031.)
676-11         Sec. 303.039.  COMMITTEES.  (a)  If permitted by the articles
676-12   of incorporation or bylaws, the board of directors, by resolution
676-13   adopted by a majority of directors in office, may designate one or
676-14   more committees consisting of two or more directors to exercise the
676-15   board's authority in the management of the corporation to the
676-16   extent provided by the resolution, articles of incorporation, or
676-17   bylaws.  The designation of a committee or delegation of authority
676-18   to a committee does not relieve the board of directors or an
676-19   individual director of a responsibility imposed by law.
676-20         (b)  Other committees not exercising the authority of the
676-21   board of directors in the management of the corporation may be
676-22   designated.  The composition of those committees may be limited to
676-23   directors, and the committee members shall be designated and
676-24   appointed by:
676-25               (1)  the board of directors by resolution; or
676-26               (2)  the president, if authorized by the articles of
676-27   incorporation, the bylaws, or a resolution of the board of
 677-1   directors.  (V.A.C.S. Art. 717s, Sec. 3.032.)
 677-2         Sec. 303.040.  MEETINGS; QUORUM.  (a)  A regular or special
 677-3   meeting of the board of directors must be called and held as
 677-4   provided by the bylaws.  A regular or special meeting may be held
 677-5   at any location in this state.
 677-6         (b)  A director's attendance at a meeting waives notice to
 677-7   the director of the meeting, unless the attendance is for the
 677-8   express purpose of objecting to the transaction of any business on
 677-9   the ground that the meeting is not lawfully called or convened.
677-10         (c)  A quorum is the lesser of:
677-11               (1)  a majority of the number of directors established
677-12   by the bylaws or, if the bylaws do not establish a number of
677-13   directors, a majority of the number of directors stated in the
677-14   articles of incorporation; or
677-15               (2)  the number of directors, not less than three,
677-16   established as a quorum by the articles of incorporation or bylaws.
677-17         (d)  The act of a majority of the directors present at a
677-18   meeting at which a quorum is present is an act of the board of
677-19   directors, unless the act of a larger number is required by the
677-20   articles of incorporation or bylaws.  (V.A.C.S. Art. 717s, Secs.
677-21   3.033(a), (b), (c), (d) (part).)
677-22         Sec. 303.041.  CORPORATION'S GENERAL POWERS.  (a)  Subject to
677-23   Section 303.045, a corporation has the rights and powers necessary
677-24   or convenient to accomplish the corporation's purposes, including
677-25   the power to:
677-26               (1)  acquire title to a public facility in order to
677-27   lease, convey, or dispose of the public facility to the
 678-1   corporation's sponsor or, on direction of the sponsor and in
 678-2   furtherance of the sponsor's purposes, to another entity;
 678-3               (2)  accept a mortgage or pledge of a public facility
 678-4   financed, refinanced, or provided by sponsor obligations purchased
 678-5   by the corporation and, as security for the payment of any
 678-6   connected bonds or credit agreements that the corporation issues or
 678-7   incurs:
 678-8                     (A)  assign the mortgage or pledge and the
 678-9   revenue and receipts from the mortgage or pledge and from the
678-10   sponsor obligations; or
678-11                     (B)  grant other security;
678-12               (3)  sell, convey, mortgage, pledge, lease, exchange,
678-13   transfer, and otherwise dispose of all or any part of the
678-14   corporation's property and other assets, including sponsor
678-15   obligations;
678-16               (4)  make a contract, incur a liability, and borrow
678-17   money at interest;
678-18               (5)  lend money for its corporate purposes, invest its
678-19   money, and take and hold security for the payment of money loaned
678-20   or invested;
678-21               (6)  sue and be sued in its corporate name;
678-22               (7)  appoint agents of the corporation and determine
678-23   their duties; and
678-24               (8)  have a corporate seal and use the seal by having
678-25   it or a facsimile of it impressed on, affixed to, or reproduced on
678-26   an instrument required or authorized to be executed by the
678-27   corporation's proper officers.
 679-1         (b)  Subsection (a) does not authorize a corporate officer or
 679-2   director to exercise a power specified in that subsection in a
 679-3   manner that is inconsistent with the corporation's articles of
 679-4   incorporation or bylaws or beyond the scope of the corporation's
 679-5   purposes.
 679-6         (c)  A sponsor may not delegate to a corporation the power of
 679-7   taxation or eminent domain, a police power, or an equivalent
 679-8   sovereign power of this state or the sponsor.  (V.A.C.S. Art. 717s,
 679-9   Sec.  4.041.)
679-10         Sec. 303.042.  TAXATION.  (a)  A public facility, including a
679-11   leasehold estate in a public facility, that is owned by a
679-12   corporation and that, except for the purposes and nonprofit nature
679-13   of the corporation, would be taxable to the corporation under Title
679-14   1, Tax Code, shall be assessed to the user of the public facility
679-15   to the same extent and subject to the same exemptions from taxation
679-16   as if the user owned the public facility.  If there is more than
679-17   one user of the public facility, the public facility shall be
679-18   assessed to the users in proportion to the value of the rights of
679-19   each user to occupy, operate, manage, or use the public facility.
679-20         (b)  The user of a public facility is considered the owner of
679-21   the facility for purposes of the application of:
679-22               (1)  sales and use taxes in the construction, sale,
679-23   lease, or rental of the public facility; and
679-24               (2)  other taxes imposed by this state or a political
679-25   subdivision of this state.
679-26         (c)  A corporation is engaged exclusively in performance of
679-27   charitable functions and is exempt from taxation by this state or a
 680-1   municipality or other political subdivision of this state.  Bonds
 680-2   issued by a corporation under this chapter, a transfer of the
 680-3   bonds, interest on the bonds, and a profit from the sale or
 680-4   exchange of the bonds are exempt from taxation by this state or a
 680-5   municipality or other political subdivision of this state.
 680-6   (V.A.C.S.  Art. 717s, Sec. 4.042.)
 680-7         Sec. 303.043.  NET EARNINGS.  No part of a corporation's net
 680-8   earnings remaining after payment of its bonds and expenses in
 680-9   accomplishing its public purpose may benefit a person other than
680-10   the sponsor of the corporation.  (V.A.C.S. Art. 717s, Sec. 4.048.)
680-11         Sec. 303.044.  OPEN MEETINGS; OPEN RECORDS.  A corporation
680-12   and its board of directors are considered to be governmental bodies
680-13   under Chapters 551 and 552, Government Code.  (V.A.C.S. Art. 717s,
680-14   Sec. 3.028(f).)
680-15         Sec. 303.045.  ALTERATION OF CORPORATION OR ACTIVITIES.  The
680-16   sponsor of a corporation, in its sole discretion, may alter the
680-17   corporation's structure, organization, programs, or activities,
680-18   consistent with the other provisions of this chapter and subject to
680-19   limitations provided by law relating to the impairment of contracts
680-20   entered into by the corporation.  (V.A.C.S. Art. 717s, Sec. 4.049.)
680-21         Sec. 303.046.  EXAMINATION OF BOOKS AND RECORDS.  A
680-22   representative of the sponsor may examine all books and other
680-23   records of the corporation at any time.  (V.A.C.S. Art. 717s, Sec.
680-24   4.050.)
680-25         Sec. 303.047.  WAIVER OF NOTICE.  If a notice is required to
680-26   be given to a director by this chapter, the articles of
680-27   incorporation, or the bylaws, a written waiver of the notice signed
 681-1   by the person entitled to the notice, before or after the time that
 681-2   would have been stated in the notice, is equivalent to giving the
 681-3   notice.  (V.A.C.S. Art. 717s, Sec. 4.054.)
 681-4            (Sections 303.048-303.070 reserved for expansion
 681-5                          SUBCHAPTER C.  BONDS
 681-6         Sec. 303.071.  AUTHORITY TO ISSUE.  With the specific
 681-7   approval by resolution of the governing body of its sponsor, a
 681-8   corporation may issue or incur bonds, including refunding bonds, to
 681-9   finance, refinance, or provide one or more public facilities.
681-10   (V.A.C.S. Art. 717s, Secs. 4.043(a) (part), 4.047 (part).)
681-11         Sec. 303.072.  SOURCE OF PAYMENT.  (a)  Bonds of a
681-12   corporation are payable from revenue derived from public facilities
681-13   or sponsor obligations.  Bonds issued under this chapter are not an
681-14   obligation or a pledge of the faith and credit of this state, a
681-15   sponsor or other political subdivision of this state, or an agency
681-16   of this state.
681-17         (b)  Each bond must contain on its face a statement that,
681-18   except to the extent of the sponsor obligations, neither the faith
681-19   and credit nor the taxing power of this state, the sponsor, or
681-20   another political subdivision of this state is pledged to the
681-21   payment of the principal of or the interest on the bonds.
681-22   (V.A.C.S. Art. 717s, Sec. 4.045.)
681-23         Sec. 303.073.  TERMS.  (a)  A bond issued under this chapter
681-24   must mature not later than 40 years after its date.
681-25         (b)  Bonds issued under this chapter may be sold in any
681-26   manner authorized by the corporation and permitted by Chapter 1201,
681-27   Government Code.
 682-1         (c)  The interest rate on the bonds may be determined by a
 682-2   formula or index or in accordance with a contract or other
 682-3   arrangement for the periodic determination of interest rates.
 682-4   (V.A.C.S. Art. 717s, Secs. 4.043(b) (part), (c) (part).)
 682-5         Sec. 303.074.  USE OF PROCEEDS.  (a)  The proceeds of the
 682-6   bonds of a corporation may be used to:
 682-7               (1)  finance, refinance, or provide one or more public
 682-8   facilities;
 682-9               (2)  maintain reserve funds determined by the sponsor
682-10   and the corporation to be necessary and appropriate; or
682-11               (3)  pay any costs relating to the issuance or
682-12   incurrence of bonds by the corporation and the purchase of sponsor
682-13   obligations by the corporation, including:
682-14                     (A)  the cost of:
682-15                           (i)  financing charges and interest on the
682-16   bonds;
682-17                           (ii)  financing, legal, accounting,
682-18   financial advisory, and appraisal fees, expenses, and
682-19   disbursements;
682-20                           (iii)  an insurance policy;
682-21                           (iv)  printing, engraving, and reproduction
682-22   services;
682-23                           (v)  the initial and acceptance fees of a
682-24   trustee, paying agent, bond registrar, or authenticating agent; and
682-25                           (vi)  a credit agreement; and
682-26                     (B)  reasonable amounts to reimburse the
682-27   corporation for time spent by its agents or employees with respect
 683-1   to the issuance, incurrence, or purchase.
 683-2         (b)  The purchase by the corporation of a sponsor obligation
 683-3   does not extinguish the debt represented by the sponsor obligation.
 683-4         (c)  Pending a use described by Subsection (a), the proceeds
 683-5   may be invested in accordance with Section 303.041.  (V.A.C.S.
 683-6   Art. 717s, Secs. 1.003(5), 4.043(e).)
 683-7         Sec. 303.075.  REFUNDING OBLIGATIONS.  (a)  A corporation may
 683-8   issue or incur bonds to refund its outstanding bonds or sponsor
 683-9   obligations of its sponsor, including any redemption premium on
683-10   them and interest accrued to the date of redemption.
683-11         (b)  The provisions of this chapter generally applicable to
683-12   bonds apply to the issuance, maturity, terms, and holder's rights
683-13   in the refunding bonds and to the corporation's rights, duties, and
683-14   obligations in relation to the refunding bonds.
683-15         (c)  The corporation may issue the refunding bonds in
683-16   exchange or substitution for outstanding bonds or sponsor
683-17   obligations or may sell the refunding bonds and use the proceeds to
683-18   pay or redeem outstanding bonds or sponsor obligations.
683-19         (d)  A corporation may issue or incur bonds to refund
683-20   outstanding debt obligations of a nonprofit corporation created by
683-21   a housing authority under the Texas Non-Profit Corporation Act
683-22   (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
683-23   (V.A.C.S. Art. 717s, Sec. 4.044.)
683-24         Sec. 303.076.  APPROVAL OF BONDS BY OTHER ENTITIES.  Except
683-25   as required by Chapter 1202, Government Code, and Section 303.071 a
683-26   corporation may issue bonds, acquire sponsor obligations, and enter
683-27   into credit agreements under this chapter without the consent or
 684-1   approval of any other subdivision or agency of this state.
 684-2   (V.A.C.S. Art. 717s, Sec.  4.047 (part).)
 684-3         Sec. 303.077.  PERFECTION OF SECURITY INTEREST.  (a)  This
 684-4   section applies only to a security interest granted by:
 684-5               (1)  a corporation as security for its bonds;
 684-6               (2)  a credit agreement pledged as security for the
 684-7   obligations of the corporation on the bonds; or
 684-8               (3)  a credit agreement issued or entered into in
 684-9   connection with the bonds.
684-10         (b)  Notwithstanding Section 9.104, Business & Commerce Code,
684-11   and without any other filing, a security interest is perfected
684-12   until payment of the bonds and credit agreement, with the effect
684-13   specified by Chapter 9, Business & Commerce Code, when the bonds
684-14   are registered by the comptroller.  (V.A.C.S. Art. 717s, Sec.
684-15   4.053.)
684-16         Sec. 303.078.  PURCHASE OF SPONSOR OBLIGATIONS.  A sponsor
684-17   may sell its sponsor obligations to a corporation that the sponsor
684-18   has created at public or private sale on the terms the governing
684-19   body of the sponsor determines.  (V.A.C.S. Art. 717s, Sec. 2.011(c)
684-20   (part).)
684-21            (Sections 303.079-303.100 reserved for expansion
684-22                SUBCHAPTER D.  DISSOLUTION OF CORPORATION
684-23         Sec. 303.101.  DISSOLUTION AUTHORIZED.  After a corporation's
684-24   bonds and other  obligations are paid and discharged, or adequate
684-25   provision is made for their payment and discharge, the sponsor's
684-26   governing body by written resolution may authorize and direct the
684-27   dissolution of the corporation.  (V.A.C.S. Art. 717s, Sec.
 685-1   4.051(a).)
 685-2         Sec. 303.102.  ARTICLES OF DISSOLUTION.  (a)  Articles of
 685-3   dissolution on behalf of the corporation must be executed by:
 685-4               (1)  the president or vice president and the secretary
 685-5   or assistant secretary; or
 685-6               (2)  the presiding officer of the sponsor's governing
 685-7   body and the secretary or clerk of that body.
 685-8         (b)  An officer signing the articles of dissolution must
 685-9   verify them.
685-10         (c)  The articles of dissolution must include:
685-11               (1)  the name of the corporation;
685-12               (2)  the name and address of the sponsor;
685-13               (3)  a statement that the dissolution was authorized by
685-14   the sponsor's governing body;
685-15               (4)  the date of the meeting at which the dissolution
685-16   was authorized;
685-17               (5)  a statement that all of the corporation's bonds
685-18   and other obligations have been paid and discharged or that
685-19   adequate provision has been made for their payment and discharge;
685-20   and
685-21               (6)  a statement that no suit is pending in a court
685-22   against the corporation or that adequate provision has been made
685-23   for the satisfaction of any judgment, order, or decree that may be
685-24   entered against the corporation in each pending suit.  (V.A.C.S.
685-25   Art. 717s, Secs. 4.051(b), (c), (d).)
685-26         Sec. 303.103.  CERTIFICATE OF DISSOLUTION.  (a)  The original
685-27   and two copies of the articles of dissolution shall be delivered to
 686-1   the secretary of state.
 686-2         (b)  If the secretary of state finds that the articles of
 686-3   dissolution comply with this chapter and have been authorized by
 686-4   the sponsor's governing body, the secretary of state, on payment of
 686-5   the fees required by this chapter, shall:
 686-6               (1)  write "filed" on the original and each copy of the
 686-7   articles of dissolution and the month, day, and year of the filing;
 686-8               (2)  file the original in the office of the secretary
 686-9   of state; and
686-10               (3)  issue two certificates of dissolution with a copy
686-11   of the articles of dissolution attached to each.
686-12         (c)  The secretary of state shall deliver a certificate of
686-13   dissolution, with a copy of the articles of dissolution attached,
686-14   to the representative of the dissolved corporation and to the
686-15   sponsor's governing body.
686-16         (d)  The existence of the corporation ceases on the issuance
686-17   of the certificate of dissolution, except for the purpose of suits,
686-18   other proceedings, and appropriate corporate action by the
686-19   directors and officers of the corporation as provided by this
686-20   chapter.  (V.A.C.S. Art. 717s, Secs. 4.051(e), (f), (g), (h).)
686-21         Sec. 303.104.  EXTENSION OF DURATION.  If a corporation is
686-22   dissolved by expiration of its duration, the corporation may amend
686-23   its articles of incorporation to extend its duration before the
686-24   third anniversary of the date of dissolution.  (V.A.C.S. Art. 717s,
686-25   Sec.  4.052(b).)
686-26         Sec. 303.105.  VESTING PROPERTY IN SPONSORING ENTITY.  The
686-27   title to all funds and other property owned by a corporation when
 687-1   it dissolves automatically vests in the corporation's sponsor
 687-2   without further conveyance, transfer, or other act.  (V.A.C.S.
 687-3   Art. 717s, Sec. 4.051(i).)
 687-4         Sec. 303.106.  RIGHTS, CLAIMS, AND LIABILITIES BEFORE
 687-5   DISSOLUTION.  (a)  The dissolution of a corporation by the
 687-6   expiration of its duration or by the issuance of a certificate of
 687-7   dissolution does not impair a remedy available to or against the
 687-8   corporation or a director or officer of the corporation for a right
 687-9   or claim existing or a liability incurred before the dissolution,
687-10   if action or other proceeding on the remedy is begun before the
687-11   third anniversary of the date of the dissolution.
687-12         (b)  The action may be prosecuted or defended by the
687-13   corporation in its corporate name.
687-14         (c)  The directors and officers may take corporate or other
687-15   action as appropriate to protect the remedy, right, or claim.
687-16   (V.A.C.S. Art. 717s, Sec. 4.052(a).)
687-17            (Sections 303.107-303.120 reserved for expansion
687-18           SUBCHAPTER E.  ADMINISTRATION BY SECRETARY OF STATE
687-19         Sec. 303.121.  ADMINISTRATION OF CHAPTER.  The secretary of
687-20   state may act as reasonably necessary to efficiently administer
687-21   this chapter and to perform the duties imposed by this chapter.
687-22   (V.A.C.S. Art. 717s, Sec. 4.055.)
687-23         Sec. 303.122.  FEES.  (a)  The secretary of state shall
687-24   charge and collect fees for:
687-25               (1)  filing articles of incorporation and issuing two
687-26   certificates of incorporation;
687-27               (2)  filing articles of amendment and issuing two
 688-1   certificates of amendment;
 688-2               (3)  filing a statement of change of address of
 688-3   registered office or change of registered agent or both;
 688-4               (4)  filing restated articles of incorporation and
 688-5   issuing two restated certificates of incorporation; and
 688-6               (5)  filing articles of dissolution.
 688-7         (b)  The fees are in the amounts charged by the secretary of
 688-8   state for the respective filings and issuances under the Texas
 688-9   Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's
688-10   Texas Civil Statutes).  (V.A.C.S. Art. 717s, Sec. 4.056.)
688-11         Sec. 303.123.  NOTICE AND APPEAL OF DISAPPROVAL.  (a)  If the
688-12   secretary of state does not approve a document required by  this
688-13   chapter to be approved by the secretary of state, the secretary of
688-14   state, not later than the 10th day after the date the document is
688-15   delivered to the secretary of state, shall give written notice of
688-16   the disapproval to the person who delivered the document.  The
688-17   notice must state the reasons for the disapproval.
688-18         (b)  The person may appeal the disapproval to a district
688-19   court of Travis County by filing with the clerk of the court a
688-20   petition including a copy of the disapproved document and a copy of
688-21   the  disapproval notice.
688-22         (c)  The court shall try the matter de novo and either
688-23   sustain the secretary of state's action or direct the secretary of
688-24   state to take action the court considers proper.  (V.A.C.S.
688-25   Art. 717s, Sec. 4.057.)
688-26         Sec. 303.124.  DOCUMENTS AS PRIMA FACIE EVIDENCE.  A court,
688-27   public office, or official body shall receive the following
 689-1   documents as prima facie evidence of the facts, or the existence or
 689-2   nonexistence of the facts, stated in the documents:
 689-3               (1)  a certificate issued by the secretary of state
 689-4   under this chapter;
 689-5               (2)  a copy, certified by the secretary of state, of a
 689-6   document filed in the office of the secretary of state under this
 689-7   chapter; and
 689-8               (3)  a certificate of the secretary of state under the
 689-9   state seal as to the existence or nonexistence of a fact relating
689-10   to a corporation that would not appear from a document or
689-11   certificate under Subdivision (1) or (2).  (V.A.C.S. Art. 717s,
689-12   Sec. 4.058.)
689-13         SECTION 12.  CONFORMING AMENDMENT.  Chapter 323, Local
689-14   Government Code, is amended by adding Subchapter C to read as
689-15   follows:
689-16               SUBCHAPTER C.  ADDITIONAL LIBRARY AUTHORITY
689-17         Sec. 323.051.  ACQUISITION AND LOCATION OF LIBRARY.  (a)  The
689-18   commissioners court of a county may:
689-19               (1)  purchase, construct, repair, equip, or improve a
689-20   building or other permanent improvement for county library use;
689-21               (2)  acquire land for county library use; and
689-22               (3)  determine the location in the county of each
689-23   county library building or permanent improvement.
689-24         (b)  A county that maintains a permanent improvement fund
689-25   shall use money in that fund to pay for each library building,
689-26   repair, or improvement.  (V.A.C.S. Art. 1696a, Sec. 1.)
689-27         Sec. 323.052.  COUNTY LIBRARY BONDS.  (a)  A county may issue
 690-1   bonds, and impose ad valorem taxes for payment of the bonds, to pay
 690-2   the cost of:
 690-3               (1)  purchasing, constructing, repairing, equipping, or
 690-4   improving a building or other permanent improvement for county
 690-5   library use; or
 690-6               (2)  acquiring land for county library use.
 690-7         (b)  The issuance of the bonds and the imposition of the
 690-8   taxes must be in conformity with Subtitles A and C, Title 9,
 690-9   Government Code. (V.A.C.S. Art. 1696a, Sec. 2.)
690-10         SECTION 13.  CONFORMING AMENDMENT.  Chapter 402, Local
690-11   Government Code, is amended by adding Subchapters G and H to read
690-12   as follows:
690-13        SUBCHAPTER G.  MANAGEMENT OF CERTAIN ENCUMBERED MUNICIPAL
690-14                        ELECTRIC UTILITY SYSTEMS
690-15         Sec. 402.121.  APPLICABILITY OF SUBCHAPTER.  This subchapter
690-16   applies only to a home-rule municipality that owns an electric
690-17   utility system, by ordinance elects to have the management and
690-18   control of the utility system governed by this subchapter, and:
690-19               (1)  has outstanding obligations payable solely from
690-20   and secured by a lien on and pledge of the net revenue of the
690-21   system; or
690-22               (2)  issues obligations that:
690-23                     (A)  are payable solely from and secured by a
690-24   lien on and pledge of the net revenue of the system; and
690-25                     (B)  are approved by the attorney general.
690-26   (V.A.C.S. Art. 1115a, Sec. 1.)
690-27         Sec. 402.122.  TRANSFER OF MANAGEMENT AND CONTROL OF ELECTRIC
 691-1   UTILITY SYSTEM.  (a)  A municipality by ordinance may transfer
 691-2   management and control of the municipality's electric utility
 691-3   system to a five-member board of trustees appointed by the
 691-4   municipality's governing body.
 691-5         (b)  The municipality by ordinance shall prescribe the
 691-6   qualifications for appointment to the board.  (V.A.C.S. Art. 1115a,
 691-7   Sec. 2.)
 691-8         Sec. 402.123.  AUTHORITY OF BOARD OF TRUSTEES.  (a)  The
 691-9   municipality may delegate to the board of trustees all or part of
691-10   the municipality's authority to:
691-11               (1)  establish rates and charges for use of the utility
691-12   system's facilities;
691-13               (2)  exercise the power of eminent domain with respect
691-14   to property that will be used by, useful to, or required by the
691-15   utility system; and
691-16               (3)  issue obligations in the name of the municipality
691-17   to acquire or construct an improvement to or extension of the
691-18   utility system or to repair the system.
691-19         (b)  The municipality may authorize the board of trustees to
691-20   issue obligations under Subsection (a)(3) without the prior
691-21   approval of the municipality.  The obligations must be payable
691-22   solely from the net revenue of the utility system.
691-23         (c)  The municipality may not delegate to the board of
691-24   trustees the authority to:
691-25               (1)  levy or collect ad valorem taxes; or
691-26               (2)  issue obligations that are payable in whole or in
691-27   part from ad valorem taxes.
 692-1         (d)  The municipality and the board of trustees may jointly
 692-2   provide for the issuance of obligations payable from ad valorem
 692-3   taxes and the utility system's net revenue by adopting identical
 692-4   provisions in an ordinance or resolution, as appropriate.
 692-5   (V.A.C.S. Art. 1115a, Sec. 3.)
 692-6         Sec. 402.124.  EFFECT OF PREVIOUSLY ISSUED BONDS.  (a)  A
 692-7   municipality or an existing board of trustees may not exercise a
 692-8   power provided by this subchapter in relation to an obligation
 692-9   issued before June 14, 1989, unless the ordinance authorizing the
692-10   issuance of the obligation or the deed of trust or trust indenture
692-11   securing payment of the obligation specifically allows the
692-12   municipality or board to exercise the power.  The authority of the
692-13   municipality or board in relation to that obligation is subject to
692-14   any restriction or covenant contained in the ordinance, deed of
692-15   trust, or trust indenture.
692-16         (b)  The board of trustees may authorize, issue, and sell
692-17   additional obligations on a parity with an obligation issued before
692-18   June 14, 1989, if the ordinance, deed of trust, or trust indenture
692-19   provides for the issuance of the obligations.  The obligations must
692-20   be payable from the revenue pledged to pay the previous obligation
692-21   and must be secured by pledges and liens on a parity with the
692-22   pledge securing the previous obligation.  (V.A.C.S.  Art. 1115a,
692-23   Sec. 4.)
692-24            (Sections 402.125-402.140 reserved for expansion)
692-25        SUBCHAPTER H.  MANAGEMENT OF CERTAIN ENCUMBERED MUNICIPAL
692-26                              WATER SYSTEMS
692-27         Sec. 402.141.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 693-1   applies only to a home-rule municipality that owns or may own a
 693-2   water, wastewater, storm water, or drainage utility system, by
 693-3   ordinance elects to have the management and control of two or more
 693-4   of those utility systems governed by this subchapter, and:
 693-5               (1)  has outstanding obligations payable solely from
 693-6   and secured by a lien on and pledge of the net revenue of one or
 693-7   more of those systems; or
 693-8               (2)  issues obligations that are payable solely from
 693-9   and secured by a lien on and pledge of the net revenue of one or
693-10   more of those systems.  (V.A.C.S.  Art. 1115b, Sec. 1.)
693-11         Sec. 402.142.  TRANSFER OF MANAGEMENT AND CONTROL OF UTILITY
693-12   SYSTEM.  (a)    A municipality by ordinance may transfer management
693-13   and control of two or more of its water, wastewater, storm water,
693-14   or drainage systems to a board of trustees.
693-15         (b)  The board of trustees must consist of at least seven
693-16   members, one of whom must be the presiding officer of the governing
693-17   body of the municipality.
693-18         (c)  The ordinance transferring management and control must
693-19   prescribe the number, qualifications, terms of office, succession,
693-20   compensation, powers, and duties of the members of the board of
693-21   trustees.
693-22         (d)  On any matter not covered by the ordinance, the board is
693-23   governed by the laws and rules governing the governing body of the
693-24   municipality, to the extent applicable.  (V.A.C.S. Art. 1115b, Sec.
693-25   2.)
693-26         SECTION 14.  CONFORMING AMENDMENT.  Chapter 411, Local
693-27   Government Code, is amended by adding Section 411.008 to read as
 694-1   follows:
 694-2         Sec. 411.008.  BREAKWATERS IN CERTAIN COUNTIES.  (a)  The
 694-3   commissioners court of a county that borders the Gulf of Mexico,
 694-4   other than Jefferson, Kenedy, Kleberg, Nueces, Orange, or Willacy
 694-5   County, may:
 694-6               (1)  construct breakwaters;
 694-7               (2)  issue bonds, time warrants, or certificates of
 694-8   indebtedness of the county to pay for the construction; and
 694-9               (3)  impose ad valorem taxes to pay the bonds,
694-10   warrants, or certificates.
694-11         (b)  The commissioners court shall:
694-12               (1)  issue any bonds and impose related taxes in
694-13   compliance with Subtitles A and C, Title 9, Government Code; or
694-14               (2)  issue any time warrants in compliance with
694-15   Subchapter C, Chapter 262, and impose related taxes in compliance
694-16   with Chapter 1253, Government Code.
694-17         (c)  A certificate of indebtedness must be authorized by
694-18   order of the commissioners court.  A certificate of indebtedness
694-19   must mature not later than 35 years after its date and must be
694-20   signed by the county judge and attested by the county clerk.  The
694-21   commissioners court shall impose a tax sufficient to pay the
694-22   principal of and interest on the certificate as they become due.
694-23         (d)  A county that maintains a permanent improvement fund
694-24   shall pay the debt incurred under this section from that fund.
694-25   (V.A.C.S. Art. 6839g, Secs. 1, 2, 3 (part).)
694-26         SECTION 15.  CONFORMING AMENDMENT.  Subtitle B, Title 13,
694-27   Local Government Code, is amended by adding Chapter 413 to read as
 695-1   follows:
 695-2         CHAPTER 413.  WATER, WASTEWATER, OR SOLID WASTE SYSTEMS
 695-3              IN COUNTIES WITH POPULATION OF 10,000 OR LESS
 695-4                    SUBCHAPTER A.  GENERAL PROVISIONS
 695-5         Sec. 413.001.  APPLICABILITY OF CHAPTER.  This chapter
 695-6   applies only to a county that:
 695-7               (1)  adopts an order under Section 413.052; and
 695-8               (2)  has a population of 10,000 or less, according to
 695-9   the most recent federal census, on the date on which the order is
695-10   adopted.  (V.A.C.S.  Art. 717v, Sec. 1.)
695-11         Sec. 413.002.  COUNTY FINANCING OF WATER OR WASTEWATER
695-12   SYSTEM.  The commissioners court of a county may spend money in the
695-13   general fund of the county or issue and sell bonds to finance the
695-14   county's:
695-15               (1)  wastewater collection and treatment system; or
695-16               (2)  water supply and distribution system.  (V.A.C.S.
695-17   Art. 717v, Sec.  2.)
695-18            (Sections 413.003-413.050 reserved for expansion
695-19          SUBCHAPTER B.  COUNTY UTILITY SYSTEM BOARD FOR WATER,
695-20                    WASTEWATER, OR SOLID WASTE SYSTEM
695-21         Sec. 413.051.  DEFINITION.  In this subchapter, "board" means
695-22   a county utility system board established under Section 413.052.
695-23   (New.)
695-24         Sec. 413.052.  AUTHORITY TO ESTABLISH BOARD.  (a)  The
695-25   commissioners court of a county by order adopted at a regular
695-26   meeting of the court may establish a county utility system board to
695-27   operate and manage the county's:
 696-1               (1)  wastewater collection and treatment system;
 696-2               (2)  water supply and distribution system; or
 696-3               (3)  solid waste collection and disposal system.
 696-4         (b)  The board is responsible for the operation and
 696-5   management of each utility system that is:
 696-6               (1)  owned or being acquired by the county; and
 696-7               (2)  placed under its control under Subsection (a).
 696-8   (V.A.C.S. Art. 717v, Secs. 2A(a), (b).)
 696-9         Sec. 413.053.  BOARD COMPOSITION.  (a)  The board is composed
696-10   of five directors.
696-11         (b)  One director must be a member of the commissioners court
696-12   appointed by the court at its first meeting of each county fiscal
696-13   year.
696-14         (c)  Four directors are elected by voters in the county.  The
696-15   elected positions are designated as positions 1, 2, 3, and 4.
696-16   Elected directors serve two-year terms with the terms of positions
696-17   1 and 3 beginning October 1 of each odd-numbered year and the terms
696-18   of positions 2 and 4 beginning October 1 of each even-numbered
696-19   year.  A candidate must be a qualified voter of the county.
696-20         (d)  An election shall be held on the second Saturday of each
696-21   September to fill the appropriate director positions.
696-22         (e)  The commissioners court shall appoint temporary
696-23   directors to serve until the initially elected directors take
696-24   office.  (V.A.C.S. Art. 717v, Secs.  2A(c) (part), (d).)
696-25         Sec. 413.054.  BOARD OFFICERS.  (a)  The directors shall
696-26   select a president, vice president, secretary, and treasurer to
696-27   serve one-year terms.
 697-1         (b)  The president and vice president must be members of the
 697-2   board.  The secretary and treasurer are not required to be board
 697-3   members.
 697-4         (c)  The offices of secretary and treasurer may be combined.
 697-5         (d)  The president is the board's chief executive officer and
 697-6   budget officer and shall preside at the meetings of the board.
 697-7         (e)  The vice president shall act as president if the
 697-8   president is incapacitated or absent from a meeting.
 697-9         (f)  The secretary shall keep the records and the minutes of
697-10   the meetings of the board.
697-11         (g)  The board shall require the treasurer to give a bond in
697-12   the amount equal to the estimated amount to be held, at any time,
697-13   by the treasurer.  The board shall pay the bond premium.  (V.A.C.S.
697-14   Art. 717v, Sec. 2A(e) (part).)
697-15         Sec. 413.055.  COMPENSATION OF DIRECTORS.  A director is
697-16   entitled to receive:
697-17               (1)  reimbursement for actual expenses incurred in
697-18   conducting the business of the board; and
697-19               (2)  a fee in the amount set by the commissioners court
697-20   for each meeting attended.  (V.A.C.S. Art. 717v, Sec. 2A(p).)
697-21         Sec. 413.056.  APPLICABILITY OF OTHER LAW TO BOARD AND
697-22   COUNTY.  (a)  The board is subject to:
697-23               (1)  Subchapter C, Chapter 262;
697-24               (2)  the open meetings law, Chapter 551, Government
697-25   Code;
697-26               (3)  the public information law, Chapter 552,
697-27   Government Code; and
 698-1               (4)  Chapter 2256, Government Code.
 698-2         (b)  The board is a governmental unit for purposes of Chapter
 698-3   101, Civil Practice and Remedies Code, and all of its activities
 698-4   are essential governmental functions.
 698-5         (c)  The board and the county when operating under this
 698-6   subchapter are subject to:
 698-7               (1)  Chapter 271;
 698-8               (2)  Chapter 1371, Government Code; and
 698-9               (3)  Subchapters C and D. (V.A.C.S. Art. 717v, Secs.
698-10   2A(m), (n) (part).)
698-11         Sec. 413.057.  BYLAWS.  (a)  The board may adopt bylaws to
698-12   regulate its affairs and establish the area in the county in which
698-13   it has responsibility for providing utility service.
698-14         (b)  The bylaws may provide for a seal for the board.
698-15   (V.A.C.S.  Art. 717v, Sec. 2A(l) (part).)
698-16         Sec. 413.058.  UTILITY SYSTEM'S BUDGET.  (a)  The president
698-17   of the board, with the assistance of the business manager, shall
698-18   propose a budget for each utility system under the board's control
698-19   that includes for the next fiscal year of the county:
698-20               (1)  the anticipated revenue of that utility system by
698-21   each source; and
698-22               (2)  the expenses of that utility system and the board.
698-23         (b)  The president shall submit the budget to the board not
698-24   later than June 1 of each year.
698-25         (c)  The board shall:
698-26               (1)  schedule a public hearing to consider the budget
698-27   not later than July 1 of each year;
 699-1               (2)  adopt a final budget not later than July 15 of
 699-2   each year; and
 699-3               (3)  submit the final budget to the commissioners court
 699-4   for consideration as a part of the county budget.
 699-5         (d)  Until the county budget is adopted, the budget for each
 699-6   utility system is the same as the budget for that system in the
 699-7   preceding fiscal year.  If a system's preceding budget was for a
 699-8   period shorter than a complete fiscal year, the budget for that
 699-9   system is increased proportionally to cover a fiscal year.
699-10         (e)  The board and the commissioners court shall include in
699-11   the budget an amount sufficient to pay and secure any outstanding
699-12   obligation under this chapter to the extent the obligation is
699-13   payable from the revenue of a utility system.  (V.A.C.S. Art. 717v,
699-14   Sec. 2A(f).)
699-15         Sec. 413.059.  DEPOSIT OF REVENUE.  (a)  Except as provided
699-16   by Subsection (b), the treasurer of the board shall deposit all
699-17   revenue from a system operated and managed by the board to the
699-18   credit of one or more separate accounts in the county depository.
699-19         (b)  The treasurer may deposit amounts set aside for the
699-20   payment or security of obligations issued on behalf of the board
699-21   with the paying agent as provided by the order authorizing the
699-22   issuance of the obligations.  (V.A.C.S.  Art. 717v, Sec. 2A(e)
699-23   (part).)
699-24         Sec. 413.060.  DISBURSEMENT OF UTILITY SYSTEM'S MONEY.  (a)
699-25   The board in its bylaws shall provide procedures under which money
699-26   the board deposits in the county depository may be spent only after
699-27   the board has determined that the money for payment was properly
 700-1   budgeted.  Approval of the board is not required for the transfer
 700-2   of money to a paying agent to pay and secure an outstanding
 700-3   obligation.
 700-4         (b)  A check issued by the board must be signed by at least
 700-5   two persons, at least one of whom is an officer of the board.
 700-6   (V.A.C.S.  Art. 717v, Sec. 2A(g).)
 700-7         Sec. 413.061.  RATES AND CHARGES.  The board may establish
 700-8   rates and charges for services, fees for connections, security
 700-9   deposits, and other charges required for efficient operation of
700-10   each utility system for which it has responsibility.  (V.A.C.S.
700-11   Art. 717v, Sec. 2A(h).)
700-12         Sec. 413.062.  USE OF EMINENT DOMAIN PROHIBITED.  The board
700-13   may not exercise the power of eminent domain.  (V.A.C.S.
700-14   Art. 717v, Sec. 2A(i) (part).)
700-15         Sec. 413.063.  EXTENSION OR IMPROVEMENT OF SYSTEM.  (a)  The
700-16   board may provide for an extension or improvement to a utility
700-17   system.
700-18         (b)  The board may not provide for the extension of service
700-19   to an area within the boundaries or extraterritorial jurisdiction
700-20   of a municipality or within a conservation and reclamation district
700-21   created under Section 59, Article XVI, Texas Constitution, without
700-22   the consent of the governing body of the municipality or district.
700-23         (c)  The service area of the board may not include territory
700-24   that on June 6, 1993, was served by another utility under a
700-25   certificate of public convenience and necessity unless the
700-26   certificate ceases to be effective.  (V.A.C.S. Art. 717v, Secs.
700-27   2A(j), (l) (part).)
 701-1         Sec. 413.064.  PURCHASE OF WATER OR WASTEWATER SYSTEM.  With
 701-2   the approval of the commissioners court, the board may purchase an
 701-3   existing privately owned wastewater collection and treatment system
 701-4   or water supply and distribution system that supplies retail
 701-5   utility service in the county.  (V.A.C.S. Art. 717v, Sec. 2A(k)
 701-6   (part).)
 701-7         Sec. 413.065.  ABOLITION OF CONSERVATION AND RECLAMATION
 701-8   DISTRICT.  (a)  With the consent of the directors of a conservation
 701-9   and reclamation district located in a county, the commissioners
701-10   court of the county may assume the outstanding obligations of the
701-11   district and provide for the abolition of the district.
701-12         (b)  The territory of the former district remains secondarily
701-13   liable for the payment of any taxes pledged to the payment of an
701-14   outstanding debt of the former district until the debt is paid or
701-15   payment has been provided for, including refunding by the county.
701-16   The commissioners court as the successor to the district shall
701-17   impose those taxes in the territory of the former district.
701-18   (V.A.C.S. Art. 717v, Sec. 2A(k) (part).)
701-19         Sec. 413.066.  AUTHORITY TO ISSUE AD VALOREM TAX OBLIGATIONS.
701-20   (a)  The board may not incur or issue an obligation that is
701-21   payable, in whole or in part, from ad valorem taxes.
701-22         (b)  The commissioners court of the county by order may
701-23   authorize on behalf of the board the issuance of obligations
701-24   payable in whole or in part from ad valorem taxes to acquire,
701-25   improve, repair, or extend the county's wastewater collection
701-26   system, treatment system, water supply and distribution system, or
701-27   solid waste collection and disposal system.
 702-1         (c)  An order under Subsection (b) must be adopted at a
 702-2   regular meeting of the commissioners court.
 702-3         (d)  If the obligations authorized under this section are
 702-4   payable from ad valorem taxes and revenue, the board must also
 702-5   approve the issuance of the obligations.  (V.A.C.S. Art. 717v,
 702-6   Secs. 2A(i) (part), (n) (part).)
 702-7         Sec. 413.067.  AUTHORITY TO ISSUE REVENUE OBLIGATIONS.  The
 702-8   board by resolution may authorize the issuance of obligations for
 702-9   one or more of the purposes described by Section 413.066(b) that
702-10   are payable solely from the revenue of one or more systems.
702-11   (V.A.C.S. Art. 717v, Sec. 2A(n) (part).)
702-12         Sec. 413.068.  MATURITY.  An obligation issued under this
702-13   subchapter must mature not later than 40 years after its date.
702-14   (V.A.C.S. Art. 717v, Sec. 2A(o).)
702-15            (Sections 413.069-413.100 reserved for expansion
702-16           SUBCHAPTER C.  BONDS FOR WATER OR WASTEWATER SYSTEM
702-17         Sec. 413.101.  PLEDGE FOR PAYMENT OF BONDS.  The
702-18   commissioners court of a county may provide for the payment of the
702-19   principal of and interest on bonds issued under this chapter:
702-20               (1)  by pledging all or part of the county's revenue
702-21   from its wastewater collection and treatment system or water supply
702-22   and distribution system; or
702-23               (2)  from other sources.  (V.A.C.S. Art. 717v, Sec. 3.)
702-24         Sec. 413.102.  ADDITIONAL BOND SECURITY.  (a)  Bonds issued
702-25   under this chapter may be secured additionally by an encumbrance on
702-26   part or all of the physical property of the wastewater collection
702-27   and treatment system or water supply and distribution system and
 703-1   each right relating to that property, vesting in the trustee the
 703-2   power to:
 703-3               (1)  operate the property;
 703-4               (2)  sell the property to pay the debt; or
 703-5               (3)  take any other action to secure the bonds.
 703-6         (b)  Regardless of an encumbrance on the property, a trust
 703-7   indenture on the property may:
 703-8               (1)  contain any provision that the commissioners court
 703-9   prescribes for the security of the bonds and the preservation of
703-10   the trust estate;
703-11               (2)  provide for amendment or modification of the trust
703-12   indenture; and
703-13               (3)  provide for investment of money from the
703-14   wastewater collection and treatment system or water supply and
703-15   distribution system.
703-16         (c)  A purchaser under a sale under the encumbrance on the
703-17   physical property:
703-18               (1)  is the absolute owner of the property and the
703-19   rights purchased; and
703-20               (2)  may maintain and operate the property.  (V.A.C.S.
703-21   Art. 717v, Sec. 4.)
703-22         Sec. 413.103.  CONTENTS OF ORDER OR RESOLUTION AUTHORIZING
703-23   ISSUANCE OF BONDS.  (a)  An order or resolution of the
703-24   commissioners court authorizing the issuance of bonds, including
703-25   refunding bonds, under this chapter may:
703-26               (1)  provide for the flow of funds and the
703-27   establishment and maintenance of an interest and sinking fund, a
 704-1   reserve fund, or another fund;
 704-2               (2)  prohibit the further issuance of obligations
 704-3   payable from the pledged revenues or reserve the right to issue
 704-4   additional bonds that are on a parity with, or subordinate to, the
 704-5   lien and pledge on the revenue being used to support the bonds
 704-6   being issued; and
 704-7               (3)  contain any other provision determined by the
 704-8   commissioners court.
 704-9         (b)  The commissioners court may make covenants with respect
704-10   to the bonds, the pledged revenues, and the operation and
704-11   maintenance of any facilities the revenue of which is pledged.
704-12   (V.A.C.S. Art. 717v, Secs. 6(a), (b), (c).)
704-13         Sec. 413.104.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
704-14   commissioners court may adopt and have executed any other
704-15   proceeding or instrument necessary and convenient in the issuance
704-16   of bonds under this chapter.  (V.A.C.S. Art. 717v, Sec. 6(d).)
704-17         Sec. 413.105.  MATURITY.  A bond issued under this chapter
704-18   other than a bond issued under Subchapter B must mature not later
704-19   than 25 years after its date of issuance.  (V.A.C.S. Art. 717v,
704-20   Secs.  5(b) (part), 8(b) (part).)
704-21         Sec. 413.106.  AUTHORIZED INVESTMENT FOR SAVINGS AND LOAN
704-22   ASSOCIATION.  A bond issued under this chapter is an authorized
704-23   investment for a savings and loan association.  (V.A.C.S.
704-24   Art. 717v, Sec. 9(a) (part).)
704-25         Sec. 413.107.  EXEMPTION FROM TAXATION.  A bond issued under
704-26   this chapter, any transaction relating to the bond, and profits
704-27   made in the sale of the bond are exempt from taxation by this state
 705-1   or by a municipality or other political subdivision of the state.
 705-2   (V.A.C.S.  Art. 717v, Sec. 10 (part).)
 705-3            (Sections 413.108-413.150 reserved for expansion
 705-4                     SUBCHAPTER D.  REFUNDING BONDS
 705-5         Sec. 413.151.  AUTHORITY TO ISSUE REFUNDING BONDS.  A county
 705-6   may issue bonds under this subchapter to refund all or part of its
 705-7   outstanding bonds issued under this chapter, including matured but
 705-8   unpaid interest coupons.  (V.A.C.S. Art. 717v, Sec. 8(a).)
 705-9         Sec. 413.152.  SOURCES AVAILABLE FOR PAYMENT.  Refunding
705-10   bonds issued under this subchapter may be payable from any source,
705-11   including the source from which the bonds to be refunded are
705-12   payable.  (V.A.C.S. Art. 717v, Sec.  8(c).)
705-13         Sec. 413.153.  REGISTRATION.  The comptroller shall register
705-14   refunding bonds issued under this subchapter on surrender and
705-15   cancellation of the bonds to be refunded. (V.A.C.S. Art. 717v, Sec.
705-16   8(d) (part).)
705-17         Sec. 413.154.  AUTHORITY TO DEPOSIT WITH PAYING AGENT.  (a)
705-18   In an order or resolution authorizing the issuance of refunding
705-19   bonds, the commissioners court may provide that proceeds from the
705-20   sale of the bonds are to be deposited with the person at whose
705-21   location the bonds to be refunded are payable.
705-22         (b)  If the authorization includes a provision authorized by
705-23   Subsection (a), the commissioners court may issue the refunding
705-24   bonds before the cancellation of the bonds to be refunded.  The
705-25   commissioners court shall deposit with the person at whose location
705-26   the bonds to be refunded are payable an amount sufficient to pay
705-27   the principal of those bonds and interest on those bonds accruing
 706-1   to the maturity date or to the option date if the bonds have been
 706-2   called for payment before maturity according to their terms.
 706-3         (c)  The comptroller shall register refunding bonds issued
 706-4   under this section without the surrender and cancellation of the
 706-5   bonds to be refunded.  (V.A.C.S. Art. 717v, Sec. 8(e).)
 706-6         Sec. 413.155.  MANNER OF REFUNDING.  The refunding  may take
 706-7   place in one delivery or in installment deliveries.  (V.A.C.S.
 706-8   Art. 717v, Sec. 8(f) (part).)
 706-9         SECTION 16.  CONFORMING AMENDMENT.  Subchapter A, Chapter
706-10   421, Local Government Code, is amended to read as follows:
706-11    SUBCHAPTER A. AUTHORITY OF COUNTY OR MUNICIPALITY BORDERING GULF
706-12                          [GENERAL PROVISIONS]
706-13         Sec. 421.001.  APPLICABILITY OF SUBCHAPTER.  This subchapter
706-14   applies only to a county or municipality that borders the Gulf of
706-15   Mexico.  (V.A.C.S. Arts. 6830 (part), 6839 (part).)
706-16         Sec. 421.002.  AUTHORIZED PROJECTS; DEBT.  (a)  The
706-17   commissioners court of the county or the municipal authority of the
706-18   municipality may:
706-19               (1)  establish, construct, extend, maintain, or improve
706-20   a seawall, breakwater, levee, floodway, or drainway; and
706-21               (2)  improve, maintain, or beautify a boulevard erected
706-22   in connection with the seawall, breakwater, levee, floodway, or
706-23   drainway.
706-24         (b)  The commissioners court or municipal authority may incur
706-25   debt for a purpose authorized under Subsection (a).  (V.A.C.S.
706-26   Art. 6830 (part).)
706-27         Sec. 421.003.  USE OF PUBLIC PROPERTY.  (a)  The
 707-1   commissioners court or municipal authority may impose additional
 707-2   uses or restrictions on a street, alley, public highway, or other
 707-3   public ground necessary for the location, construction, or
 707-4   maintenance of a seawall, breakwater, levee, floodway, or drainway.
 707-5         (b)  The commissioners court or municipal authority may
 707-6   authorize an additional use of the seawall, breakwater, levee,
 707-7   floodway, or drainway if that use will not impair the efficiency of
 707-8   the seawall, breakwater, levee, floodway, or drainway.  (V.A.C.S.
 707-9   Art. 6831.)
707-10         Sec. 421.004.  ACQUISITION OF PROPERTY; EMINENT DOMAIN.  (a)
707-11   The county or municipality may acquire property that is necessary
707-12   for the establishment, construction, and maintenance of a seawall,
707-13   breakwater, levee, floodway, or drainway.
707-14         (b)  The county or municipality may exercise the right of
707-15   eminent domain to condemn an interest in real property for the
707-16   purposes described by Subsection (a).  The county or municipality
707-17   must exercise the power of eminent domain in the manner provided by
707-18   Chapter 21, Property Code.
707-19         (c)  Before exercising the power of eminent domain under this
707-20   section the commissioners court or municipal authority, by order,
707-21   ordinance, or resolution entered in its minutes, shall define and
707-22   describe the real property to be acquired and shall determine
707-23   whether an easement or fee simple interest in the real property is
707-24   to be taken.  (V.A.C.S. Art. 6832.)
707-25         Sec. 421.005.  CESSION OF USE AND CONTROL OF STATE LAND.  The
707-26   state cedes to a county or municipality that uses this subchapter
707-27   the right to the use and control of as much of the land and sea
 708-1   bottom below high tide that the commissioners court or municipal
 708-2   authority considers necessary for the purposes prescribed by this
 708-3   subchapter.  (V.A.C.S. Art. 6837.)
 708-4         Sec. 421.006.  TAX; BONDS.  (a)  The commissioners court or
 708-5   municipal authority may impose a tax to pay the debt incurred under
 708-6   Section 421.002.  The rate of the tax in any year may not exceed 50
 708-7   cents on each $100 of the taxable value of property taxable by the
 708-8   county or municipality.
 708-9         (b)  The commissioners court or municipal authority may issue
708-10   bonds under this subchapter for the payment of the debt, but, if
708-11   revenue from the tax will not pay off the debt within five years,
708-12   the commissioners court or municipal authority shall issue bonds
708-13   for the payment of the debt.  (V.A.C.S. Art. 6830 (part).)
708-14         Sec. 421.007.  PREREQUISITES FOR ISSUING BONDS; ELECTION.
708-15   (a)  Before the commissioners court or municipal authority may
708-16   issue bonds under this subchapter:
708-17               (1)  the commissioners court or municipal authority
708-18   shall prescribe the amount of and the rate of interest on bonds to
708-19   be issued; and
708-20               (2)  the tax proposed to pay the interest and sinking
708-21   fund on the bonds must be approved by a majority of the voters of
708-22   the county or municipality, as appropriate, voting at an election
708-23   held on the proposed tax.
708-24         (b)  The election shall be held in accordance with Chapter
708-25   1251, Government Code.  In addition to the notice required under
708-26   Section 1251.003, Government Code, and Chapter 4, Election Code,
708-27   the commissioners court or municipal authority shall mail to each
 709-1   registered voter in the county or municipality a copy of the ballot
 709-2   proposition before the 10th day preceding the date of the election.
 709-3         (c)  The commissioners court or municipal authority shall
 709-4   issue any bonds under this subchapter in compliance with the
 709-5   applicable provisions of Subtitles A and C, Title 9, Government
 709-6   Code.  (V.A.C.S. Arts. 6833, 6834 (part).)
 709-7         Sec. 421.008.  ELECTION RESULTS.  If the canvass of the
 709-8   election returns shows that the requisite number of voters voted in
 709-9   favor of the proposition, the commissioners court or municipal
709-10   authority may issue the bonds and impose the tax for the purposes
709-11   provided by this subchapter.  (V.A.C.S.  Art. 6835 (part).)
709-12         Sec. 421.009.  GENERAL LAW APPLICABLE TO BONDS.  A bond
709-13   issued under this subchapter is subject to other law regulating
709-14   bonds issued by counties and municipalities to the extent that law
709-15   does not conflict with this subchapter.  (V.A.C.S. Art. 6839
709-16   (part).)
709-17         Sec. 421.010.  HANDLING OF BOND PROCEEDS AND TAXES.  (a)  All
709-18   amounts received from the sale of bonds under this subchapter shall
709-19   be deposited with the county or municipal treasurer, as
709-20   appropriate.  The county or municipal treasurer shall hold the
709-21   amounts in trust exclusively for the purposes prescribed by this
709-22   subchapter.
709-23         (b)  The county or municipality shall hold all taxes
709-24   collected to pay the interest on and principal of bonds issued
709-25   under this subchapter in trust for the payment of the interest and
709-26   principal.  Any amount that exceeds the amount required to pay the
709-27   annual interest on the bonds may be invested for the benefit of the
 710-1   sinking fund in:
 710-2               (1)  bonds issued under this subchapter;
 710-3               (2)  bonds of the state; or
 710-4               (3)  bonds of the United States.  (V.A.C.S. Arts. 6836
 710-5   (part), 6838.)
 710-6         Sec. 421.011.  COOPERATION AND CONTRACTS WITH UNITED STATES.
 710-7   (a)  The commissioners court or [courts and the] municipal
 710-8   authority [authorities of all counties and municipalities bordering
 710-9   on the coast of the Gulf of Mexico] may cooperate and contract with
710-10   the United States for grants, loans, or advance payments to carry
710-11   out any of the powers or purposes prescribed by this subchapter
710-12   [Title 118, Revised Statutes].
710-13         (b)  The commissioners court or [courts and] municipal
710-14   authority [authorities] may contribute and pay to the United States
710-15   all or any part of the proceeds of bonds they have issued and sold
710-16   under this subchapter [Title 118], in connection with any project
710-17   undertaken by the federal government affecting or relating to the
710-18   construction or maintenance of a seawall, boulevard, or other
710-19   project authorized under this subchapter [Title 118].
710-20         (c)  It is the purpose of this section [subchapter] to confer
710-21   on the commissioners court or [courts and] municipal authority
710-22   [authorities] the fullest possible power of contract with regard to
710-23   projects of common interest enumerated in this subchapter [Title
710-24   118], when these projects are approved by an act of the United
710-25   States Congress.
710-26         SECTION 17.  CONFORMING AMENDMENT.  Section 421.021(a), Local
710-27   Government Code, is amended to read as follows:
 711-1         (a)  The Commissioners Court of Matagorda County and the
 711-2   governing body of a municipality in the county may by resolution
 711-3   establish a seawall commission to perform the functions described
 711-4   by Section 421.002 [Article 6830, Revised Statutes].
 711-5         SECTION 18.  CONFORMING AMENDMENT.  Sections 421.023(e) and
 711-6   (g), Local Government Code, are amended to read as follows:
 711-7         (e)  The commission may enter into a contract relating to the
 711-8   performance of any of the functions described by Section 421.002
 711-9   [Article 6830, Revised Statutes].
711-10         (g)  The commission may exercise any of the authority granted
711-11   to a county or municipality under Section 421.002,  421.003,
711-12   421.004, or 421.005 or Section 421.011(a) or (b) [:]
711-13               [(1)  Articles 6830, 6831, and 6832, Revised Statutes;]
711-14               [(2)  Article 6837, Revised Statutes; and]
711-15               [(3)  Sections 421.001(a) and (b)].
711-16         SECTION 19.  CONFORMING AMENDMENT.  Subtitle C, Title 13,
711-17   Local Government Code, is amended by adding Chapter 422 to read as
711-18   follows:
711-19      CHAPTER 422.  PUBLIC UTILITY AGENCIES FOR PROVISION OF WATER
711-20                            OR SEWER SERVICE
711-21                    SUBCHAPTER A.  GENERAL PROVISIONS
711-22         Sec. 422.001.  DEFINITIONS.  In this chapter:
711-23               (1)  "Facility" means a facility necessary or
711-24   incidental to the collection, transportation, treatment, or
711-25   disposal of sewage or to the conservation, storage, transportation,
711-26   treatment, or distribution of water, including a plant site,
711-27   right-of-way, and property, equipment, or right of any kind useful
 712-1   in connection with the collection, transportation, treatment, or
 712-2   disposal of sewage or with the conservation, storage,
 712-3   transportation, treatment, or distribution of water.
 712-4               (2)  "Private entity" means an entity, other than a
 712-5   public entity, involved solely in financing, constructing,
 712-6   operating, or maintaining water and sewer facilities.
 712-7               (3)  "Public entity" means a political entity or
 712-8   corporate body of this state, including a county, municipality, or
 712-9   district or authority created under Section 52, Article III, or
712-10   Section 59, Article XVI, Texas Constitution.  (V.A.C.S. Art. 1110f,
712-11   Secs. 2(1), (2), (3).)
712-12         Sec. 422.002.  EFFECT OF CHAPTER.  This chapter does not
712-13   affect:
712-14               (1)  the statutory purposes relating to the
712-15   establishment, operation, or regulation under the Water Code or
712-16   other applicable law of a public entity that may become a co-owner
712-17   of a public utility agency under this chapter; or
712-18               (2)  a public or private entity's rights or powers in
712-19   effect on August 27, 1979.  (V.A.C.S. Art. 1110f, Secs. 1 (part),
712-20   5(b) (part).)
712-21         Sec. 422.003.  CONSTRUCTION.  This chapter shall be liberally
712-22   construed to carry out its purposes.  (V.A.C.S. Art. 1110f, Secs. 1
712-23   (part), 5(a) (part), (b) (part).)
712-24         Sec. 422.004.  CONFLICTS WITH OTHER LAW.  This chapter
712-25   prevails to the extent of a conflict between this chapter and any
712-26   other law, including:
712-27               (1)  a law regulating the affairs of a municipal
 713-1   corporation; or
 713-2               (2)  a home-rule charter provision.  (V.A.C.S.
 713-3   Art. 1110f, Sec. 5(a) (part).)
 713-4            (Sections 422.005-422.010 reserved for expansion
 713-5                  SUBCHAPTER B.  COOPERATION BY PUBLIC
 713-6                          AND PRIVATE ENTITIES
 713-7         Sec. 422.011.  AUTHORITY TO JOINTLY OWN FACILITIES.  Two or
 713-8   more public entities that have the authority to engage in the
 713-9   collection, transportation, treatment, or disposal of sewage or the
713-10   conservation, storage, transportation, treatment, or distribution
713-11   of water may join together as cotenants or co-owners to plan,
713-12   finance, acquire, construct, own, operate, or maintain facilities
713-13   to:
713-14               (1)  achieve economies of scale in providing essential
713-15   water and sewage systems to the public;
713-16               (2)  promote the orderly economic development of this
713-17   state; and
713-18               (3)  provide environmentally sound protection of this
713-19   state's future water and wastewater needs.  (V.A.C.S. Art. 1110f,
713-20   Sec. 1 (part).)
713-21         Sec. 422.012.  GENERAL RIGHTS, POWERS, AND DUTIES OF PUBLIC
713-22   ENTITIES.  (a)  Each participating public entity may:
713-23               (1)  use the entity's money to plan, acquire,
713-24   construct, own, operate, and maintain its interest in a facility;
713-25               (2)  share in the facility;
713-26               (3)  issue bonds and other securities to raise money
713-27   for a purpose described by Subdivision (1) in the same manner and
 714-1   to the same extent and subject to the same conditions as would be
 714-2   applicable if the public entity had sole ownership of the facility;
 714-3               (4)  acquire, for the use and benefit of each
 714-4   participating public entity, land, easements, and property for a
 714-5   facility by purchase or by exercising the power of eminent domain;
 714-6   and
 714-7               (5)  transfer or otherwise convey the land, property,
 714-8   or property interest or otherwise have the land, property, or
 714-9   property interest become vested in other participating public
714-10   entities to the extent and in the manner agreed between the
714-11   entities.
714-12         (b)  In relation to a participating public entity's undivided
714-13   interest in a facility, the entity has each right, privilege,
714-14   exemption, power, duty, and liability the entity would have if the
714-15   entity had sole ownership. (V.A.C.S.  Art. 1110f, Secs. 1 (part),
714-16   4(a), (b) (part).)
714-17         Sec. 422.013.  USE OF EMINENT DOMAIN.  (a)  A participating
714-18   public entity has the power of eminent domain to be exercised as
714-19   provided by this section.
714-20         (b)  The use of eminent domain authority by a participating
714-21   public entity is governed by the law relating to an eminent domain
714-22   proceeding involving a municipality in this state.
714-23         (c)  A participating public entity may acquire a fee title to
714-24   the condemned real property, excluding mineral interests.
714-25         (d)  A participating public entity may not use eminent domain
714-26   authority to acquire an interest in a facility that belongs to
714-27   another public entity or a private entity.  (V.A.C.S. Art. 1110f,
 715-1   Sec. 4(b) (part).)
 715-2         Sec. 422.014.  EXEMPTION FROM TAXATION.  A participating
 715-3   public entity is entitled to each constitutional or statutory ad
 715-4   valorem or other tax exemption attributable to the jointly owned
 715-5   facility or to a property or service bought, sold, leased, or used
 715-6   to construct, maintain, repair, or operate the facility to the
 715-7   extent that the entity would have been exempt from the tax if the
 715-8   entity's undivided interest were an entire interest in the facility
 715-9   or in the property or service.  The entity is entitled to any
715-10   applicable exemption certificate or statement provided by law to
715-11   claim or prove the exemption.  (V.A.C.S. Art. 1110f, Sec. 4(c).)
715-12            (Sections 422.015-422.050 reserved for expansion
715-13                 SUBCHAPTER C.  PUBLIC UTILITY AGENCIES
715-14         Sec. 422.051.  DEFINITIONS.  In this subchapter:
715-15               (1)  "Concurrent ordinance" means an ordinance or
715-16   resolution adopted under this subchapter by two or more public
715-17   entities that relates to the creation or re-creation of a public
715-18   utility agency.
715-19               (2)  "Obligation" means a revenue bond or note.
715-20               (3)  "Public utility agency" means an agency created
715-21   under this subchapter by two or more public entities to plan,
715-22   finance, construct, own, operate, or maintain facilities.
715-23   (V.A.C.S. Art. 1110f, Secs. 2(4), 3(c) (part); New.)
715-24         Sec. 422.052.  CREATION OF PUBLIC UTILITY AGENCY.  (a)
715-25   Public entities may create a public utility agency by concurrent
715-26   ordinances.
715-27         (b)  A public entity may join in the creation of a public
 716-1   utility agency under this subchapter only if, at the time the
 716-2   concurrent ordinance is adopted, the entity has the authority to
 716-3   engage in the collection, transportation, treatment, or disposal of
 716-4   sewage or the conservation, storage, transportation, treatment, or
 716-5   distribution of water.  This subsection does not prohibit a public
 716-6   entity from disposing of a facility after creation of the agency.
 716-7         (c)  A public utility agency is a:
 716-8               (1)  separate agency;
 716-9               (2)  political subdivision of this state; and
716-10               (3)  political entity and corporate body.
716-11         (d)  A public utility agency may not impose a tax but has all
716-12   the other powers that are related to facilities and that are
716-13   provided by law to a municipality that owns a facility.  (V.A.C.S.
716-14   Art. 1110f, Secs. 1 (part), 3(a) (part).)
716-15         Sec. 422.053.  RE-CREATION OF PUBLIC UTILITY AGENCY.  The
716-16   public entities that create a public utility agency may by
716-17   concurrent ordinances re-create the agency by adding or deleting,
716-18   or both, a public entity.  (V.A.C.S.  Art. 1110f, Sec. 3(b).)
716-19         Sec. 422.054.  NOTICE.  (a)  The governing body of each
716-20   public entity shall publish notice of its intention to create a
716-21   public utility agency in a newspaper of general circulation in the
716-22   county in which the entity is domiciled.
716-23         (b)  A notice under this section must be published once a
716-24   week for two consecutive weeks.  The first publication must appear
716-25   not later than the 15th day before the date set for passage of the
716-26   concurrent ordinance.
716-27         (c)  The notice must state:
 717-1               (1)  the date, time, and location at which the
 717-2   governing body proposes to adopt the concurrent ordinance; and
 717-3               (2)  that a public utility agency will be created on
 717-4   the date on which the concurrent ordinances take effect. (V.A.C.S.
 717-5   Art. 1110f, Sec.  3(a) (part).)
 717-6         Sec. 422.055.  CONTENTS OF CONCURRENT ORDINANCE.  A
 717-7   concurrent ordinance creating a public utility agency under Section
 717-8   422.052 or re-creating an agency under Section 422.053 must, as
 717-9   adopted by each public entity:
717-10               (1)  contain identical provisions;
717-11               (2)  define the boundaries of the agency to include the
717-12   territory within the boundaries of each participating public entity
717-13   as the boundaries are changed periodically;
717-14               (3)  designate the name of the agency; and
717-15               (4)  designate the number, place, initial term, and
717-16   manner of appointment of directors in accordance with Section
717-17   422.057.  (V.A.C.S. Art. 1110f, Secs. 3(c) (part), 4(d) (part), (e)
717-18   (part).)
717-19         Sec. 422.056.  PETITION AND REFERENDUM.  (a)  If, before the
717-20   date set for the adoption of a concurrent ordinance, 10 percent of
717-21   the registered voters of a public entity present a petition to the
717-22   governing body of the entity requesting that a referendum be
717-23   called, the ordinance may not take effect unless a majority of the
717-24   qualified voters of the entity voting in the election have approved
717-25   the ordinance.
717-26         (b)  The public entity must hold the election in conformity
717-27   with:
 718-1               (1)  the Election Code;
 718-2               (2)  Chapter 1251, Government Code; and
 718-3               (3)  this subchapter.
 718-4         (c)  Except as provided by Subsection (a), a concurrent
 718-5   ordinance is not subject to a referendum.  (V.A.C.S. Art. 1110f,
 718-6   Sec. 3(a) (part).)
 718-7         Sec. 422.057.  BOARD OF DIRECTORS.  (a)  A public utility
 718-8   agency shall be governed by a board of directors.  The board is
 718-9   responsible for the management, operation, and control of the
718-10   property belonging to the agency.
718-11         (b)  Each director must be appointed by place by the
718-12   governing bodies of the participating public entities. Each
718-13   participating public entity is entitled to appoint at least one
718-14   director.
718-15         (c)  An employee, officer, or member of the governing body of
718-16   a public entity may serve as a director but may not have a personal
718-17   interest in a contract executed by the public utility agency other
718-18   than as an employee, officer, or member of the governing body of
718-19   the public entity.
718-20         (d)  A director of a public utility agency is entitled to $50
718-21   for each day spent in attending meetings of the board and a per
718-22   diem of $50 if authorized by resolution of the board, plus actual
718-23   expenses incurred in attending the meetings.
718-24         (e)  Except as provided by Subsection (d), a director of a
718-25   public utility agency serves without compensation.  (V.A.C.S.
718-26   Art. 1110f, Secs. 4(d) (part), (e) (part), (f) (part).)
718-27         Sec. 422.058.  POWERS.  (a)  A public utility agency may not
 719-1   engage in any utility business other than the collection,
 719-2   transportation, treatment, or disposal of sewage or the
 719-3   conservation, storage, transportation, treatment, or distribution
 719-4   of water for a participating public entity that owns jointly with
 719-5   the agency a facility in this state.
 719-6         (b)  A public utility agency may:
 719-7               (1)  perform any act necessary to the full exercise of
 719-8   the agency's powers;
 719-9               (2)  enter into a contract, lease, or agreement with or
719-10   accept a grant or loan from a:
719-11                     (A)  department or agency of the United States;
719-12                     (B)  department, agency, or municipality or other
719-13   political subdivision of this state; or
719-14                     (C)  public or private corporation or person;
719-15               (3)  sell, lease, convey, or otherwise dispose of any
719-16   right, interest, or property the agency considers to be unnecessary
719-17   for the efficient operation or maintenance of its facilities; and
719-18               (4)  adopt rules to govern the operation of the agency
719-19   and its employees, facilities, and service.  (V.A.C.S. Art. 1110f,
719-20   Secs.  3(a) (part), 4(f) (part), (o) (part).)
719-21         Sec. 422.059.  CONSTRUCTION CONTRACTS.  (a)  A public utility
719-22   agency may award a contract for construction of an improvement that
719-23   involves the expenditure of more than $20,000 only on the basis of
719-24   competitive bids.
719-25         (b)  The agency shall publish notice of intent to receive
719-26   bids once a week for two consecutive weeks in a newspaper of
719-27   general circulation in the county in which the agency is domiciled.
 720-1   The first publication must appear not later than the 15th day
 720-2   before the date bids are to be received.  (V.A.C.S. Art. 1110f,
 720-3   Sec. 4(o) (part).)
 720-4         Sec. 422.060.  CONTRACTS FOR SEWER OR WATER SERVICES.  A
 720-5   public utility agency may:
 720-6               (1)  contract with the public entities creating the
 720-7   agency for the collection, transportation, treatment, or disposal
 720-8   of sewage or the conservation, storage, transportation, treatment,
 720-9   or distribution of water; and
720-10               (2)  under terms the agency's board of directors
720-11   considers appropriate, contract with private entities for services
720-12   described by Subdivision (1).  (V.A.C.S. Art. 1110f, Sec. 4(f)
720-13   (part).)
720-14         Sec. 422.061.  RATES AND CHARGES.  (a)  In contracting with a
720-15   public or private entity for wastewater collection, transmission,
720-16   treatment, or disposal services or for water conservation, storage,
720-17   transportation, treatment, or distribution, a public utility agency
720-18   must charge rates sufficient to produce revenue adequate to:
720-19               (1)  pay all expenses of operation and maintenance;
720-20               (2)  pay when due the principal of and interest on
720-21   obligations issued  under this subchapter;
720-22               (3)  pay the principal of and interest on any legal
720-23   debt of the agency;
720-24               (4)  pay when due all sinking and reserve fund
720-25   payments;  and
720-26               (5)  fulfill any agreements made with the holders of
720-27   any obligations.
 721-1         (b)  A public utility agency may also establish a reasonable
 721-2   depreciation and emergency fund.
 721-3         (c)  Payments made under a contract with a public utility
 721-4   agency constitute an operating expense of the public or private
 721-5   entity served under the contract, unless otherwise prohibited by a
 721-6   previously outstanding obligation of the purchasing entity.
 721-7         (d)  Notwithstanding Subsection (a), the state reserves its
 721-8   power to regulate and control the rates and charges by a public
 721-9   utility agency.
721-10         (e)  Until obligations issued under this subchapter have been
721-11   paid and discharged, this state pledges to and agrees with the
721-12   purchasers and successive holders of the obligations that it will
721-13   not limit or alter the powers of the agency to establish and
721-14   collect rates and charges that will produce revenue sufficient to
721-15   pay for those items specified in Subsections (a) and (b) and any
721-16   other obligations of the agency in connection with those items.
721-17   (V.A.C.S.  Art. 1110f, Secs. 4(g), (h).)
721-18         Sec. 422.062.  OBLIGATIONS.  (a)  A public utility agency may
721-19   issue obligations to accomplish the purposes of the agency.
721-20         (b)  The public utility agency may pledge to the payment of
721-21   the obligations the revenue of all or part of its facilities,
721-22   including facilities acquired after the obligations are issued.
721-23   However, operation and maintenance expenses, including salaries and
721-24   labor, materials, and repairs of facilities necessary to render
721-25   efficient service, are a first lien on and charge against the
721-26   pledged revenue.
721-27         (c)  The public utility agency may set aside from the
 722-1   proceeds of the sale of the obligations amounts for payment into
 722-2   the interest and sinking fund and reserve fund, and for interest
 722-3   and operating expenses during construction and development, as
 722-4   specified in the proceedings authorizing the obligations.
 722-5         (d)  Obligation proceeds may be invested, pending their use,
 722-6   in securities, interest-bearing certificates, or time deposits as
 722-7   specified in the proceedings authorizing the obligations.
 722-8   (V.A.C.S.  Art. 1110f, Secs. 4(i), (j) (part), (k).)
 722-9         Sec. 422.063.  REFUNDING NOTES.  A public utility agency may
722-10   issue refunding notes for the purpose and in the manner provided by
722-11   general law, including Chapter 1207, Government Code.  (V.A.C.S.
722-12   Art. 1110f, Sec. 4(m).)
722-13         Sec. 422.064.  FORM AND PROVISIONS OF OBLIGATIONS.  (a) An
722-14   obligation issued under this subchapter must mature not later than
722-15   40 years after its date of issuance.
722-16         (b)  The obligations must be signed by the presiding officer
722-17   or assistant presiding officer of the public utility agency and be
722-18   attested by the secretary.
722-19         (c)  A public utility agency may sell obligations issued
722-20   under this subchapter at public or private sale at a price or under
722-21   the terms the agency determines to be in the best interest of the
722-22   agency.  (V.A.C.S. Art. 1110f, Sec. 4(p) (part).)
722-23         SECTION 20.  CONFORMING AMENDMENT.  Subtitle A, Title 4,
722-24   Transportation Code, is amended by adding Chapter 54 to read as
722-25   follows:
722-26           CHAPTER 54.  HARBOR AND PORT FACILITIES IN CERTAIN
722-27                             MUNICIPALITIES
 723-1                    SUBCHAPTER A.  GENERAL PROVISIONS
 723-2         Sec. 54.001.  APPLICABILITY OF CHAPTER.  This chapter applies
 723-3   only to a municipality that:
 723-4               (1)  is located on:
 723-5                     (A)  the Gulf of Mexico; or
 723-6                     (B)  a channel, canal, bay, or inlet connected to
 723-7   that gulf; and
 723-8               (2)  has a population of more than 5,000.  (V.A.C.S.
 723-9   Art. 1187f, Sec.  1 (part).)
723-10         Sec. 54.002.  DEFINITIONS.  In this chapter:
723-11               (1)  "Board" means a board of trustees established
723-12   under Section 54.051.
723-13               (2)  "Obligation" includes a bond.
723-14               (3)  "Port improvement or facility" means an
723-15   improvement or facility necessary or convenient for the proper
723-16   operation of a port or harbor of a municipality, including:
723-17                     (A)  land, an interest in land, or property;
723-18                     (B)  a wharf, pier, or dock;
723-19                     (C)  a roadway or belt railway;
723-20                     (D)  a warehouse, grain elevator, transport
723-21   facility, handling facility, or storage facility;
723-22                     (E)  a ship repair facility, dumping facility,
723-23   bunkering facility, floating plant or facility, lightering
723-24   facility, towing facility, or other facility that a navigation
723-25   district is authorized to provide;
723-26                     (F)  equipment and supplies; and
723-27                     (G)  any other structure, building, or facility
 724-1   necessary or convenient for the proper operation of a port or
 724-2   harbor of the municipality.  (V.A.C.S. Art. 1187f, Sec. 1 (part);
 724-3   New.)
 724-4         Sec. 54.003.  AUTHORITY REGARDING PORT IMPROVEMENTS AND
 724-5   FACILITIES.  (a)  A municipality that owns and operates a port may
 724-6   construct, acquire, lease, improve, enlarge, extend, repair,
 724-7   maintain, replace, develop, or operate a port improvement or
 724-8   facility.
 724-9         (b)  A port improvement or facility may be constructed on
724-10   land acquired by purchase, lease, or otherwise, and the land,
724-11   interest in the land, or port improvement or facility may be
724-12   conveyed by lease, sublease, or sale by installment or otherwise on
724-13   the terms the municipality determines to be advantageous.
724-14         (c)  Each power provided by this section is a public and
724-15   governmental function, is exercised for a public purpose, and is a
724-16   matter of public necessity.  (V.A.C.S. Art. 1187f, Sec. 1 (part).)
724-17         Sec. 54.004.  AUTHORITY TO IMPOSE TAX; ELECTION.
724-18   (a)  Notwithstanding any law or charter provision to the contrary,
724-19   the governing body of a municipality may impose a tax at a rate not
724-20   to exceed 10 cents on each $100 of assessed valuation of property
724-21   for the maintenance and operation of a port or harbor of the
724-22   municipality.
724-23         (b)  The tax may be imposed only if it has been approved by a
724-24   majority of the qualified voters voting at an election held for
724-25   that purpose.
724-26         (c)  Section 41.001(a), Election Code, does not apply to the
724-27   election.  (V.A.C.S. Art. 1187f, Sec.  2A.)
 725-1         Sec. 54.005.  APPLICABILITY OF OTHER LAW.  Except to the
 725-2   extent that it conflicts or is inconsistent with this chapter,
 725-3   Subchapter B, Chapter 1502, Government Code, applies to revenue
 725-4   obligations issued under this chapter, and a municipality to which
 725-5   this chapter applies has, with respect to a revenue obligation
 725-6   issued under this chapter, each power granted by that subchapter.
 725-7   (V.A.C.S. Art. 1187f, Sec. 9 (part).)
 725-8             (Sections 54.006-54.050 reserved for expansion
 725-9       SUBCHAPTER B.  MANAGEMENT AND CONTROL OF PORT IMPROVEMENTS
725-10                    AND FACILITIES; BOARD OF TRUSTEES
725-11         Sec. 54.051.  MANAGEMENT AND CONTROL BY GOVERNING BODY OR
725-12   BOARD.  (a)  An ordinance authorizing the issuance of obligations
725-13   under this chapter may provide that while the principal of or
725-14   interest on the obligations is outstanding, management and control
725-15   of the port improvement or facility and of the income and revenue
725-16   from the port improvement or facility, including the authority to
725-17   set a charge, prepare a budget, and authorize an expenditure, is
725-18   vested in:
725-19               (1)  the governing body of the municipality; or
725-20               (2)  the board of trustees named in the ordinance.
725-21         (b)  A board may consist of not more than seven  members, one
725-22   of whom must be a member of the governing body of the municipality.
725-23         (c)  Notwithstanding Subsection (a), if the municipality is
725-24   operating under a home-rule charter that requires that the port
725-25   improvement or facility be managed or controlled by a board of
725-26   trustees, the charter controls.  (V.A.C.S. Art. 1187f, Sec. 3(a)
725-27   (part).)
 726-1         Sec. 54.052.  ORGANIZATION AND DUTIES OF BOARD.  (a)  An
 726-2   ordinance under Section 54.051 that vests management and control of
 726-3   a port improvement or facility in a board must:
 726-4               (1)  specify the board members' compensation;
 726-5               (2)  specify the members' terms of office;
 726-6               (3)  specify the members' powers and duties and the
 726-7   manner of exercising those powers and duties;
 726-8               (4)  provide for the election or appointment of the
 726-9   members' successors; and
726-10               (5)  specify any other matter relating to the members'
726-11   organization and duties.
726-12         (b)  If the municipality is operating under a home-rule
726-13   charter that contains a provision relating to a matter described by
726-14   Subsection (a), each provision of the ordinance relating to that
726-15   matter must be in accordance with and is governed by the charter.
726-16         (c)  On any matter not covered by the ordinance or the
726-17   municipal charter, the board is governed by the laws and rules
726-18   governing the governing body of the municipality to the extent
726-19   applicable.  (V.A.C.S. Art. 1187f, Sec. 3(a) (part).)
726-20         Sec. 54.053.  CHARACTER OF BOARD; GENERAL POWERS.  (a)  A
726-21   board is a body politic and corporate.
726-22         (b)  A board may:
726-23               (1)  manage, control, maintain, and operate each port
726-24   improvement or facility constituting a port or harbor of the
726-25   municipality;
726-26               (2)  employ a general manager and any other officer,
726-27   employee, or representative the board considers appropriate;
 727-1               (3)  notwithstanding any law or charter provision to
 727-2   the contrary:
 727-3                     (A)  prepare and adopt a budget for the operation
 727-4   of a port or harbor of the municipality;
 727-5                     (B)  set charges for a service or facility;
 727-6                     (C)  authorize an expenditure; and
 727-7                     (D)  manage and control the income and revenue of
 727-8   each port or harbor of the municipality;
 727-9               (4)  determine policies and adopt rules and procedures
727-10   for the operation of each port or harbor of the municipality;
727-11               (5)  acquire property or an interest in property for
727-12   any purpose set forth in Section 54.003 in the manner provided by
727-13   this chapter and construct a port improvement or facility on the
727-14   property;
727-15               (6)  contract in its own name, but not in the name of
727-16   the municipality;
727-17               (7)  sue and be sued in its own name;
727-18               (8)  adopt, use, and alter a corporate seal;
727-19               (9)  establish a port security force, employ public
727-20   security officers licensed by the Commission on Law Enforcement
727-21   Officer Standards and Education, and commission employees of the
727-22   force as peace officers;
727-23               (10)  own, establish, construct, improve, equip,
727-24   maintain, operate, regulate, protect, or police any transportation
727-25   facility and any necessary appurtenance to that facility; and
727-26               (11)  exercise any additional power granted by the
727-27   ordinance or charter.  (V.A.C.S. Art. 1187f, Sec. 3(b) (part).)
 728-1         Sec. 54.054.  COMPETITIVE BIDDING.  (a)  Except as otherwise
 728-2   provided by this chapter, the board may award a contract involving
 728-3   the expenditure of more than $15,000 only by competitive bidding.
 728-4         (b)  Competitive bidding is not required:
 728-5               (1)  for a contract or expenditure exempt from
 728-6   competitive bidding under Section 252.022, Local Government Code,
 728-7   or another applicable law;
 728-8               (2)  for a contract for:
 728-9                     (A)  personal or professional services;
728-10                     (B)  a real estate transaction;
728-11                     (C)  operation of a port improvement or facility
728-12   under a specific agreement for a limited term; or
728-13                     (D)  insurance; or
728-14               (3)  if the board determines that the delay posed by
728-15   the competitive bidding procedure would prevent or substantially
728-16   impair the operation of a port.  (V.A.C.S. Art. 1187f, Sec.  3(b)
728-17   (part).)
728-18         Sec. 54.055.  APPROVAL BY ORDINANCE REQUIRED FOR SALE OF REAL
728-19   PROPERTY.  Notwithstanding any other provision of this chapter, a
728-20   board may sell real property only if the governing body of the
728-21   municipality by ordinance approves the sale.  (V.A.C.S. Art. 1187f,
728-22   Sec. 11 (part).)
728-23             (Sections 54.056-54.100 reserved for expansion
728-24                       SUBCHAPTER C.  OBLIGATIONS
728-25         Sec. 54.101.  DEFINITION.  In this subchapter, "net revenue"
728-26   means the gross revenue derived from the operation of a port
728-27   improvement or facility the net revenue of which is pledged to the
 729-1   payment of an obligation less:
 729-2               (1)  the reasonable expenses of maintaining and
 729-3   operating the port improvement or facility, including necessary
 729-4   repair, maintenance, and insurance of the port improvement or
 729-5   facility; and
 729-6               (2)  if the municipality pledging the net revenue is a
 729-7   home-rule municipality, any annual payment of the municipality
 729-8   provided for in the charter.  (V.A.C.S. Art. 1187f, Sec. 4(a)
 729-9   (part).)
729-10         Sec. 54.102.  AUTHORITY OF MUNICIPALITY TO ISSUE OBLIGATIONS.
729-11   The governing body of a municipality by ordinance may issue in the
729-12   name of the municipality obligations payable from taxes, revenue,
729-13   or both to provide money for a port improvement or facility.
729-14   (V.A.C.S. Art. 1187f, Secs. 2 (part), 6(a) (part), (b) (part).)
729-15         Sec. 54.103.  ELECTION.  (a)  Obligations payable from ad
729-16   valorem taxes, other than refunding obligations, may be issued only
729-17   if authorized by a majority of the qualified voters voting at an
729-18   election held under Chapter 1251, Government Code.
729-19         (b)  Notwithstanding any law or charter provision to the
729-20   contrary, an election is not required to authorize the issuance
729-21   under this chapter of obligations payable solely from revenue if:
729-22               (1)  the obligations are not:
729-23                     (A)  a debt of the municipality; or
729-24                     (B)  a pledge of the faith and credit of the
729-25   municipality; and
729-26               (2)  the owner or holder of an obligation is not
729-27   entitled to demand payment from money raised by taxation.
 730-1   (V.A.C.S. Art. 1187f, Sec. 2 (part).)
 730-2         Sec. 54.104.  AUTHORITY OF BOARD TO ISSUE OBLIGATIONS.  (a)
 730-3   A board by resolution may issue in the name of the board, with the
 730-4   consent of the governing body of the municipality:
 730-5               (1)  obligations payable from revenue in the manner
 730-6   provided by this chapter to provide money for a port improvement or
 730-7   facility or to refund previously issued obligations;
 730-8               (2)  expense warrants drawn against the revenue of the
 730-9   board to pay expenses during the fiscal year of the board in which
730-10   the warrants are issued; or
730-11               (3)  certificates of participation in contractual
730-12   obligations to pay money.
730-13         (b)  Notwithstanding any other provision of this chapter, a
730-14   board may issue obligations only if the governing body of the
730-15   municipality by ordinance approves the issuance.  (V.A.C.S.
730-16   Art. 1187f, Secs. 3(b) (part), 6(b) (part), 11 (part).)
730-17         Sec. 54.105.  LIMITATION ON AGGREGATE AMOUNT OF EXPENSE
730-18   WARRANTS.  The aggregate amount of expense warrants issued under
730-19   Section 54.104(a)(2) that are outstanding at any time during a
730-20   fiscal year may not exceed 50 percent of the difference between:
730-21               (1)  the revenue of the board budgeted for that fiscal
730-22   year; and
730-23               (2)  the principal of and interest on board obligations
730-24   other than expense warrants to be paid from the revenue of the
730-25   board during that fiscal year.  (V.A.C.S.  Art. 1187f, Sec. 3(b)
730-26   (part).)
730-27         Sec. 54.106.  MATURITY OF OBLIGATION.  An obligation issued
 731-1   under this chapter must mature not later than 40 years after its
 731-2   date.  (V.A.C.S. Art. 1187f, Secs. 6(a) (part), (b) (part).)
 731-3         Sec. 54.107.  SIGNATURES.  (a)  An obligation issued by a
 731-4   municipality under this chapter must be signed by the mayor or
 731-5   presiding officer of the municipality and countersigned by the
 731-6   municipal secretary or municipal clerk.
 731-7         (b)  An obligation authorized by a board under this
 731-8   subchapter must be signed by the presiding officer of the board and
 731-9   countersigned by the secretary or assistant secretary.  (V.A.C.S.
731-10   Art. 1187f, Secs. 6(a) (part), (b) (part).)
731-11         Sec. 54.108.  SALE OF OBLIGATIONS.  (a)  Obligations issued
731-12   under this chapter shall be sold at a public or private sale under
731-13   terms determined by the governing body or the board issuing the
731-14   obligations to be the most advantageous and reasonably obtainable.
731-15         (b)  Subsection (a) applies to obligations payable from
731-16   revenue notwithstanding any restriction in a municipal charter to
731-17   the contrary.  (V.A.C.S. Art. 1187f, Secs. 4(a) (part), 6(a)
731-18   (part), (b) (part).)
731-19         Sec. 54.109.  CONTENTS OF ORDINANCE OR RESOLUTION AUTHORIZING
731-20   ISSUANCE OF OBLIGATIONS PAYABLE FROM REVENUE.  (a)  The ordinance
731-21   of the governing body of the municipality or the resolution of the
731-22   board authorizing the issuance of obligations payable from revenue
731-23   may:
731-24               (1)  provide for the flow of funds and the
731-25   establishment and maintenance of an interest and sinking fund,
731-26   reserve fund, or other fund;
731-27               (2)  specify a depository for the money; and
 732-1               (3)  contain any additional covenant, as considered
 732-2   appropriate, with respect to the obligations, the pledged revenue,
 732-3   and the operation and maintenance of each port improvement or
 732-4   facility the net revenue of which is pledged, including provisions
 732-5   for:
 732-6                     (A)  the lease of a port improvement or facility;
 732-7   and
 732-8                     (B)  the use or pledge of money derived from that
 732-9   lease.
732-10         (b)  The ordinance or resolution or another proceeding may:
732-11               (1)  prohibit the further issuance of obligations
732-12   payable from pledged revenue; or
732-13               (2)  reserve the right to issue additional obligations
732-14   to be secured by a pledge of and payable from the net revenue on a
732-15   parity with, or subordinate to, the lien and pledge in support of
732-16   the obligations being issued, subject to any condition provided by
732-17   the ordinance, resolution, or other proceeding.
732-18         (c)  The ordinance, resolution, or other proceeding may
732-19   provide for an annual payment to the general fund of the
732-20   municipality to be made from revenue received from the operation of
732-21   the port improvement or facility the net revenue of which is
732-22   pledged.  The amount of the payment may be specified in:
732-23               (1)  the ordinance, resolution, or proceeding; or
732-24               (2)  the charter of the municipality if the
732-25   municipality is a home-rule municipality.
732-26         (d)  The ordinance, resolution, or other proceeding may
732-27   provide that surplus net revenue received from the operation of the
 733-1   port improvement or facility the net revenue of which is pledged
 733-2   may be used for the payment of the principal of and interest on any
 733-3   obligation payable from taxes issued by the municipality under this
 733-4   chapter.
 733-5         (e)  The ordinance, resolution, or other proceeding may
 733-6   contain other provisions and covenants.  If the municipality is a
 733-7   home-rule municipality, the provisions must be consistent with any
 733-8   charter provision relating to the port improvement or facility that
 733-9   is not inconsistent with this chapter.  (V.A.C.S. Art. 1187f, Sec.
733-10   5.)
733-11         Sec. 54.110.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
733-12   REVENUE OBLIGATIONS.  (a)  If revenue obligations issued under this
733-13   chapter state that they are secured in whole or in part by a pledge
733-14   of the proceeds from a contract, including a lease contract, a copy
733-15   of the contract and of the proceedings authorizing the contract
733-16   must be submitted to the attorney general with the record relating
733-17   to the issuance of the obligations.
733-18         (b)  The approval by the attorney general of the obligations
733-19   is approval of the contract.
733-20         (c)  After approval, the contract is incontestable except for
733-21   forgery or fraud.  (V.A.C.S. Art. 1187f, Sec. 6(c) (part).)
733-22         Sec. 54.111.  SECURITY FOR AND PAYMENT OF OBLIGATIONS PAYABLE
733-23   FROM REVENUE.  (a)  Obligations issued under this chapter and
733-24   payable from revenue may be secured solely by and paid from a
733-25   pledge of the net revenue derived from the operation of all or a
733-26   designated part of a port improvement or facility then in existence
733-27   or to be improved, constructed, or acquired.
 734-1         (b)  While the principal of or interest on the obligations is
 734-2   outstanding, the issuer shall:
 734-3               (1)  impose and collect charges in an amount sufficient
 734-4   to pay:
 734-5                     (A)  maintenance and operation expenses of the
 734-6   port improvement or facility the net revenue of which is pledged;
 734-7                     (B)  the interest on the obligations as it
 734-8   accrues; and
 734-9                     (C)  the principal of the obligations as the
734-10   obligations mature; and
734-11               (2)  make any other payment prescribed by the
734-12   ordinance, resolution, or other proceeding authorizing or relating
734-13   to the issuance of the obligations.
734-14         (c)  Obligations payable from revenue may be secured:
734-15               (1)  solely by a pledge of all or part of the revenue
734-16   from any lease, sublease, sale, or contract of sale entered into by
734-17   the municipality or board with respect to the port improvement or
734-18   facility to be financed with the obligations; or
734-19               (2)  as provided by Subdivision (1) and by a trust
734-20   indenture and a mortgage or deed of trust lien on or security
734-21   interest in the port improvement or facility.  (V.A.C.S.
734-22   Art. 1187f, Secs. 4(a) (part), (b) (part).)
734-23         Sec. 54.112.  USE OF CERTAIN PROCEEDS.  From the proceeds
734-24   from the sale of obligations issued under this chapter, there may
734-25   be appropriated or set aside:
734-26               (1)  an amount for the payment of interest expected to
734-27   accrue while a port improvement or facility is under construction;
 735-1               (2)  an amount necessary to pay all expenses incurred
 735-2   and to be incurred in the issuance, sale, and delivery of the
 735-3   obligations; and
 735-4               (3)  an amount required by the ordinance or resolution
 735-5   authorizing the issuance of the obligations to be deposited to the
 735-6   credit of a reserve fund or other fund specified by the ordinance
 735-7   or resolution.  (V.A.C.S. Art. 1187f, Sec. 7.)
 735-8         Sec. 54.113.  LEASE OR SALE OF PORT IMPROVEMENTS AND
 735-9   FACILITIES.  (a)  In connection with the issuance of obligations
735-10   payable from revenue, a municipality or board may lease, sublease,
735-11   or sell to any person, firm, corporation, partnership, political
735-12   subdivision of this state, or agency of the United States any port
735-13   improvement or facility to be constructed or acquired with the
735-14   proceeds of the obligations.
735-15         (b)  A lease, sublease, or contract of sale may contain any
735-16   provision the municipality or board determines advantageous,
735-17   including, in the case of a lease, a provision for:
735-18               (1)  the sale of a port improvement or facility at the
735-19   termination of the lease; or
735-20               (2)  the management and operation of a port improvement
735-21   or facility by the lessee.
735-22         (c)  A lease or contract of sale may provide that the lessee
735-23   or purchaser of a port improvement or facility is unconditionally
735-24   obligated to make payments for use or purchase of the port
735-25   improvement or facility in amounts adequate to timely pay the
735-26   principal of and interest and premium on the obligations issued to
735-27   finance the construction or acquisition of the port improvement or
 736-1   facility.  (V.A.C.S. Art. 1187f, Sec. 4(b) (part).)
 736-2         Sec. 54.114.  ENCUMBRANCE OF PORT IMPROVEMENTS OR FACILITIES
 736-3   FINANCED BY OBLIGATIONS PAYABLE FROM AD VALOREM TAXES.  A
 736-4   municipality may not encumber a port improvement or facility
 736-5   financed by obligations payable from ad valorem taxes unless
 736-6   authorized at the election required by Section 54.103.  (V.A.C.S.
 736-7   Art. 1187f, Sec. 9 (part).)
 736-8             (Sections 54.115-54.150 reserved for expansion
 736-9                  SUBCHAPTER D.  REFUNDING OBLIGATIONS
736-10         Sec. 54.151.  APPLICABILITY OF LAW RELATING TO ORIGINAL
736-11   OBLIGATIONS.  The provisions of this chapter relating to original
736-12   obligations apply to refunding obligations issued under this
736-13   chapter to the extent the provisions can be made to apply.
736-14   (V.A.C.S. Art. 1187f, Sec. 8(e).)
736-15         Sec. 54.152.  AUTHORITY TO ISSUE TAX REFUNDING OBLIGATIONS.
736-16   The governing body of a municipality, under the procedures provided
736-17   by this chapter, may issue tax obligations to refund outstanding
736-18   tax obligations, including original or refunding obligations,
736-19   issued by the municipality under this chapter.  (V.A.C.S.
736-20   Art. 1187f, Sec. 8(a).)
736-21         Sec. 54.153.  AUTHORITY TO ISSUE REVENUE REFUNDING
736-22   OBLIGATIONS.  The governing body of a municipality or a board,
736-23   under the procedures provided by this chapter, may issue
736-24   obligations payable from revenue to refund outstanding obligations
736-25   payable from revenue, including original or refunding obligations:
736-26               (1)  issued under this chapter;
736-27               (2)  issued for a purpose described by Section 54.003;
 737-1   or
 737-2               (3)  payable from the revenue of a port improvement or
 737-3   facility.  (V.A.C.S. Art. 1187f, Sec. 8(b) (part).)
 737-4         Sec. 54.154.  TERMS OF ISSUANCE OF REVENUE REFUNDING
 737-5   OBLIGATIONS.  (a)  Revenue refunding obligations may:
 737-6               (1)  be combined with new or original revenue
 737-7   obligations into one series or issue;
 737-8               (2)  be issued to refund obligations of more than one
 737-9   series or issue;
737-10               (3)  combine the pledges securing the obligations to be
737-11   refunded to secure the revenue refunding obligations; or
737-12               (4)  be secured by a pledge of other or additional net
737-13   revenue.
737-14         (b)  A revenue refunding obligation may bear interest at a
737-15   rate higher than that of the obligation to be refunded.  (V.A.C.S.
737-16   Art. 1187f, Sec. 8(b) (part).)
737-17         Sec. 54.155.  REGISTRATION OF REFUNDING OBLIGATIONS BY
737-18   COMPTROLLER.  (a)  Except as provided by Subsection (b), the
737-19   comptroller shall register refunding obligations on surrender and
737-20   cancellation of the obligations to be refunded.
737-21         (b)  The comptroller shall register refunding obligations
737-22   without the surrender and cancellation of the obligations to be
737-23   refunded if the ordinance or resolution authorizing the issuance of
737-24   the refunding obligations requires that:
737-25               (1)  the obligations be sold at public or private sale;
737-26   and
737-27               (2)  the proceeds from the sale be deposited:
 738-1                     (A)  in a place where the underlying obligations
 738-2   are payable; or
 738-3                     (B)  with the comptroller.
 738-4         (c)  Refunding obligations to which Subsection (b) applies
 738-5   may be issued in an amount sufficient to pay the principal of and
 738-6   interest on the obligations to be refunded to the option or
 738-7   maturity date of the obligations.  (V.A.C.S. Art. 1187f, Sec. 8(c)
 738-8   (part).)
 738-9         Sec. 54.156.  ESCROW AGREEMENT.  (a)  The proceeds from
738-10   revenue refunding obligations that are deposited as provided by
738-11   Section 54.155(b)(2) shall be deposited under an escrow agreement
738-12   so that the proceeds and interest earned from the investment of the
738-13   proceeds will be available to pay the principal of and interest on
738-14   the obligations to be refunded as each becomes due.
738-15         (b)  The escrow agreement may provide that the proceeds may,
738-16   until needed to pay principal and interest as each becomes due, be
738-17   invested in direct obligations of the United States.
738-18         (c)  Interest earned on an investment described by Subsection
738-19   (b):
738-20               (1)  may be pledged to the payment of the principal of
738-21   and interest on the obligations to be refunded or the refunding
738-22   obligations; or
738-23               (2)  shall be considered as revenue of the applicable
738-24   port improvement or facility.  (V.A.C.S. Art. 1187f, Sec. 8(c)
738-25   (part).)
738-26         SECTION 21.  CONFORMING AMENDMENT.  The heading to Subchapter
738-27   A, Chapter 256, Transportation Code, is amended to read as follows:
 739-1     SUBCHAPTER A.  FUNDS USED FOR COUNTY ROADS; GENERAL PROVISIONS
 739-2         SECTION 22.  CONFORMING AMENDMENT.  Subchapter A, Chapter
 739-3   256, Transportation Code, is amended by adding Section 256.010 to
 739-4   read as follows:
 739-5         Sec. 256.010.  APPLICABILITY OF CHAPTER TO COUNTY OPERATING
 739-6   UNDER SPECIAL ROAD TAX LAW.  A county operating under a special
 739-7   road tax law may take any action authorized by this chapter.
 739-8   (V.A.C.S.  Art. 726, Sec. 2.016 (part).)
 739-9         SECTION 23.  CONFORMING AMENDMENT.  Subchapter A, Chapter
739-10   257, Transportation Code, is amended by adding Section 257.006 to
739-11   read as follows:
739-12         Sec. 257.006.  APPLICABILITY OF CHAPTER TO COUNTY OPERATING
739-13   UNDER SPECIAL ROAD TAX LAW.  A county operating under a special
739-14   road tax law may take any action authorized by this chapter.
739-15   (V.A.C.S.  Art. 726, Sec. 2.016 (part).)
739-16         SECTION 24.  CONFORMING AMENDMENT.  Subtitle E, Title 6,
739-17   Transportation Code, is amended by adding Chapter 317 to read as
739-18   follows:
739-19      CHAPTER 317.  ELIMINATION OF GRADE-LEVEL STREET CROSSINGS BY
739-20                  RAILROAD LINES IN MUNICIPALITIES WITH
739-21                     POPULATION OF MORE THAN 100,000
739-22                    SUBCHAPTER A.  GENERAL PROVISIONS
739-23         Sec. 317.001.  APPLICABILITY OF CHAPTER.  This chapter
739-24   applies only to a municipality with a population of more than
739-25   100,000.  (V.A.C.S. Art. 1105c, Sec. 1 (part).)
739-26         Sec. 317.002.  DEFINITION.  In this chapter, "facility" means
739-27   property that the governing body of a municipality considers
 740-1   necessary for the elimination of a grade-level crossing by a
 740-2   railroad line from a street of the municipality or for the
 740-3   relocation of a railroad line within the municipality, including:
 740-4               (1)  land;
 740-5               (2)  a right-of-way;
 740-6               (3)  an elevated structure;
 740-7               (4)  a grade separation;
 740-8               (5)  an underpass or overpass;
 740-9               (6)  a passenger station, depot, or other building;
740-10               (7)  an interchange yard;
740-11               (8)  a railroad track; and
740-12               (9)  any other improvement.  (V.A.C.S. Art. 1105c, Sec.
740-13   1 (part).)
740-14         Sec. 317.003.  AUTHORITY REGARDING FACILITIES.  (a)  To
740-15   decrease hazards to life or property, promote public safety or
740-16   convenience, improve traffic conditions, or encourage the orderly
740-17   development of the municipality, a municipality may acquire,
740-18   construct, improve, enlarge, extend, maintain, repair, or replace a
740-19   facility.
740-20         (b)  Activities authorized by Subsection (a) include:
740-21               (1)  removing and relocating railroad tracks, a utility
740-22   line or pipe, or another improvement;
740-23               (2)  removing or demolishing a building or another
740-24   improvement;
740-25               (3)  paying for damage to other property in connection
740-26   with an activity described by that subsection; or
740-27               (4)  improving a street in connection with an activity
 741-1   described by that subsection.  (V.A.C.S. Art. 1105c, Sec. 1
 741-2   (part).)
 741-3         Sec. 317.004.  APPLICABILITY OF OTHER LAW.  Except to the
 741-4   extent that it conflicts or is inconsistent with this chapter,
 741-5   Subchapter B, Chapter 1502, Government Code, applies to revenue
 741-6   bonds issued under this chapter, and a municipality to which this
 741-7   chapter applies has, with respect to a revenue bond issued under
 741-8   this chapter, each power granted by that subchapter.  (V.A.C.S.
 741-9   Art. 1105c, Sec. 12.)
741-10         Sec. 317.005.  CONFLICT WITH MUNICIPAL CHARTER.  To the
741-11   extent of a conflict between this chapter and a municipal charter,
741-12   this chapter controls.  (V.A.C.S. Art. 1105c, Sec. 15 (part).)
741-13         Sec. 317.006.  AGREEMENTS.  (a)  In this section, "agreement"
741-14   includes a contract, lease, conveyance, contract of sale, or
741-15   lease-purchase contract.
741-16         (b)  The governing body of a municipality may enter into an
741-17   agreement with any person with respect to a facility, including an
741-18   agreement in connection with or incidental to the acquisition,
741-19   financing, construction, or operation of a facility, if the
741-20   governing body:
741-21               (1)  considers the agreement necessary or convenient to
741-22   implement this chapter; and
741-23               (2)  authorizes the agreement by ordinance or
741-24   resolution.
741-25         (c)  The mayor or other presiding officer of the municipality
741-26   must execute the agreement, and the municipal secretary or clerk
741-27   must attest to the agreement.
 742-1         (d)  An agreement entered into by a municipality under this
 742-2   chapter is binding on the municipality and its governing body.
 742-3   (V.A.C.S. Art. 1105c, Sec. 2 (part).)
 742-4         Sec. 317.007.  EMINENT DOMAIN.  (a)  A municipality may
 742-5   exercise the power of eminent domain to acquire the fee simple
 742-6   title to, an easement in, or a right-of-way over or through any
 742-7   property, including water or land under water, that the governing
 742-8   body of the municipality determines necessary to accomplish a
 742-9   purpose provided by Section 317.003.
742-10         (b)  A municipality may not condemn property under Subsection
742-11   (a) if the property is used for cemetery purposes.
742-12         (c)  A municipality shall pay adequate compensation to the
742-13   owner of property that is taken, damaged, or destroyed in the
742-14   accomplishment of a purpose provided by Section 317.003.
742-15         (d)  A municipality may pay compensation and damages
742-16   adjudicated in a condemnation proceeding or damage to the property
742-17   of a person in the accomplishment of a purpose provided by Section
742-18   317.003 from:
742-19               (1)  the proceeds of tax or revenue bonds issued under
742-20   this chapter; or
742-21               (2)  other available municipal money.
742-22         (e)  Chapter 21, Property Code, governs the procedure for the
742-23   exercise of the power of eminent domain under this section.
742-24   (V.A.C.S. Art. 1105c, Sec. 14.)
742-25            (Sections 317.008-317.050 reserved for expansion
742-26          SUBCHAPTER B.  MANAGEMENT AND CONTROL OF FACILITIES;
742-27                            BOARD OF TRUSTEES
 743-1         Sec. 317.051.  DEFINITION.  In this subchapter, "board" means
 743-2   a board of trustees established under Section 317.052. (New.)
 743-3         Sec. 317.052.  MANAGEMENT AND CONTROL BY GOVERNING BODY OR
 743-4   BOARD.  An ordinance authorizing the issuance of revenue bonds
 743-5   under this chapter may provide that while the principal of or
 743-6   interest on the bonds is outstanding, and regardless of whether the
 743-7   facility is encumbered under Section 317.112, management and
 743-8   control of the facility is vested in:
 743-9               (1)  the governing body of the municipality; or
743-10               (2)  the board of trustees named in the ordinance.
743-11   (V.A.C.S. Art. 1105c, Sec. 10 (part).)
743-12         Sec. 317.053.  COMPOSITION OF BOARD.  A board may consist of
743-13   not more than seven  members, one of whom must be a member of the
743-14   governing body of the municipality.  (V.A.C.S. Art. 1105c, Sec. 10
743-15   (part).)
743-16         Sec. 317.054.  ORGANIZATION AND DUTIES OF BOARD.  (a)  An
743-17   ordinance under Section 317.052 that vests management and control
743-18   of a facility in a board must:
743-19               (1)  specify the board members' compensation, which may
743-20   not exceed five percent of the gross revenue of the facility;
743-21               (2)  specify the members' terms of office;
743-22               (3)  specify the members' powers and duties and the
743-23   manner of exercising those powers and duties;
743-24               (4)  provide for the election or appointment of the
743-25   members' successors; and
743-26               (5)  specify any other matter relating to the members'
743-27   organization and duties.
 744-1         (b)  On any matter not covered by the ordinance, the board is
 744-2   governed by the laws and rules governing the governing body of the
 744-3   municipality to the extent applicable.  (V.A.C.S. Art. 1105c, Sec.
 744-4   10 (part).)
 744-5            (Sections 317.055-317.100 reserved for expansion
 744-6                          SUBCHAPTER C.  BONDS
 744-7         Sec. 317.101.  DEFINITION.  In this subchapter, "net revenue"
 744-8   means the gross revenue derived from the operation or use of a
 744-9   facility the net revenue of which is pledged to the payment of a
744-10   bond less the reasonable expenses of maintaining and operating the
744-11   facility, including necessary repair and insurance of the facility.
744-12   (V.A.C.S. Art. 1105c, Sec. 4 (part).)
744-13         Sec. 317.102.  AUTHORITY TO ISSUE BONDS.  The governing body
744-14   of a municipality by ordinance may issue tax bonds, revenue bonds,
744-15   or both to provide money for a facility.  (V.A.C.S. Art. 1105c,
744-16   Secs. 3 (part), 6 (part), 7 (part).)
744-17         Sec. 317.103.  ELECTION.  (a)  Tax bonds, other than
744-18   refunding bonds, may be issued only if authorized by a majority of
744-19   the qualified voters voting at an election held under Chapter 1251,
744-20   Government Code.
744-21         (b)  The governing body of a municipality may:
744-22               (1)  submit a proposition for the issuance of revenue
744-23   bonds at an election held in the manner provided by Subsection (a)
744-24   for tax bonds; or
744-25               (2)  issue revenue bonds without an election.
744-26   (V.A.C.S. Art. 1105c, Secs. 3 (part), 4 (part), 11(a) (part), (b)
744-27   (part).)
 745-1         Sec. 317.104.  MATURITY.  A bond issued under this chapter
 745-2   must mature not later than 40 years after its date.  (V.A.C.S.
 745-3   Art. 1105c, Sec. 7 (part).)
 745-4         Sec. 317.105.  SIGNATURES.  A bond issued under this chapter
 745-5   must be signed by the mayor or presiding officer of the
 745-6   municipality and countersigned by the municipal secretary or clerk.
 745-7   (V.A.C.S. Art. 1105c, Sec. 7 (part).)
 745-8         Sec. 317.106.  SALE OF BONDS.  A municipality may sell bonds
 745-9   issued under this chapter at a public or private sale under terms
745-10   determined by the governing body to be the most advantageous and
745-11   reasonably obtainable.  (V.A.C.S. Art. 1105c, Sec. 7 (part).)
745-12         Sec. 317.107.  CONTENTS OF ORDINANCE AUTHORIZING ISSUANCE OF
745-13   REVENUE BONDS.  (a)  The ordinance of the governing body of the
745-14   municipality authorizing the issuance of revenue bonds and the
745-15   related proceedings may:
745-16               (1)  provide for the flow of funds and the
745-17   establishment and maintenance of an interest and sinking fund,
745-18   reserve fund, or other fund;
745-19               (2)  specify a depository for the money; and
745-20               (3)  contain any additional covenant, as considered
745-21   appropriate, with respect to the bonds, the pledged revenue, and
745-22   the operation and maintenance of each facility the net revenue of
745-23   which is pledged, including provisions for:
745-24                     (A)  the lease of a facility; and
745-25                     (B)  the use or pledge of money derived from that
745-26   lease.
745-27         (b)  The ordinance or related proceeding may:
 746-1               (1)  prohibit the further issuance of bonds or other
 746-2   obligations payable from pledged revenue; or
 746-3               (2)  reserve the right to issue additional bonds to be
 746-4   secured by a pledge of and payable from the net revenue on a parity
 746-5   with, or subordinate to, the lien and pledge in support of the
 746-6   bonds being issued, subject to any condition provided by the
 746-7   ordinance or related proceeding.
 746-8         (c)  The ordinance or related proceeding may contain any
 746-9   other provision or covenant determined by the governing body.
746-10   (V.A.C.S. Art. 1105c, Sec. 5 (part).)
746-11         Sec. 317.108.  ADOPTION AND EXECUTION OF DOCUMENTS.  The
746-12   governing body of a municipality may adopt and have executed any
746-13   other proceeding or instrument necessary or convenient in the
746-14   issuance of revenue bonds.  (V.A.C.S. Art. 1105c, Sec. 5 (part).)
746-15         Sec. 317.109.  REVIEW AND APPROVAL OF CONTRACTS RELATING TO
746-16   REVENUE BONDS.  (a)  If revenue bonds issued under this chapter
746-17   state that they are secured in whole or in part by a pledge of the
746-18   proceeds from a contract between the municipality and another
746-19   person, a copy of the contract and of the proceedings authorizing
746-20   the contract must be submitted to the attorney general with the
746-21   bond record.
746-22         (b)  The approval by the attorney general of the bonds is
746-23   approval of the contract.
746-24         (c)  After approval, the contract is incontestable except for
746-25   forgery or fraud.  (V.A.C.S. Art. 1105c, Sec. 7 (part).)
746-26         Sec. 317.110.  SECURITY FOR AND PAYMENT OF BONDS PAYABLE FROM
746-27   REVENUE.  (a)  Revenue bonds may be secured by a pledge of and paid
 747-1   from:
 747-2               (1)  the net revenue derived from the operation or use
 747-3   of all or a designated part of a facility then in existence or to
 747-4   be improved, constructed, or acquired;
 747-5               (2)  the revenue, proceeds, or payments that will
 747-6   accrue to or be received by the municipality under a lease-purchase
 747-7   contract or contract of sale relating to a facility; or
 747-8               (3)  a combination of those sources.
 747-9         (b)  While the principal of or interest on bonds is
747-10   outstanding, the municipality shall:
747-11               (1)  impose and collect charges in an amount sufficient
747-12   to pay:
747-13                     (A)  maintenance and operation expenses of the
747-14   facility the net revenue of which is pledged;
747-15                     (B)  the interest on the bonds as it accrues; and
747-16                     (C)  the principal of the bonds as the bonds
747-17   mature; and
747-18               (2)  make any other payment prescribed by the ordinance
747-19   or other proceeding authorizing or relating to the issuance of the
747-20   bonds.   (V.A.C.S. Art. 1105c, Secs. 4 (part), 6 (part).)
747-21         Sec. 317.111.  USE OF CERTAIN PROCEEDS.  From the proceeds of
747-22   bonds issued under this chapter, the governing body of a
747-23   municipality may appropriate or set aside:
747-24               (1)  an amount for the payment of interest expected to
747-25   accrue while a facility is under construction;
747-26               (2)  an amount necessary to pay all expenses incurred
747-27   and to be incurred in the issuance, sale, and delivery of the
 748-1   bonds; and
 748-2               (3)  in the case of revenue bonds, an amount required
 748-3   by the ordinance authorizing the issuance of the bonds to be
 748-4   deposited to the credit of a reserve fund or other fund specified
 748-5   by the ordinance.  (V.A.C.S. Art. 1105c, Sec. 8.)
 748-6         Sec. 317.112.  ENCUMBRANCE AS ADDITIONAL SECURITY.  (a)  As
 748-7   additional security for the payment of revenue bonds issued under
 748-8   this chapter, the governing body of a municipality may have
 748-9   executed in favor of the bondholders an indenture or deed of trust
748-10   that encumbers all or part of a facility the net revenue of which
748-11   is pledged to the payment of the bonds, including the land on which
748-12   the facility is located.
748-13         (b)  An indenture or deed of trust entered into under this
748-14   section:
748-15               (1)  may contain terms considered proper by the
748-16   governing body;
748-17               (2)  may provide for a grant, to any purchaser at a
748-18   foreclosure sale, of a franchise to operate the facility for a term
748-19   not to exceed 40 years from the date of the purchase, subject to
748-20   all laws regulating same then in force; and
748-21               (3)  is enforceable in the manner provided under the
748-22   laws of this state for the enforcement of other encumbrances.
748-23         (c)  Under a sale ordered under the provisions of an
748-24   encumbrance entered into under this section, the purchaser and the
748-25   purchaser's successors or assigns are vested with:
748-26               (1)  a permit or franchise to maintain the facility
748-27   that conforms to the provisions stipulated in the indenture or deed
 749-1   of trust;
 749-2               (2)  powers and privileges similar to those of the
 749-3   municipality in the operation of the facility; and
 749-4               (3)  the right to remove all or part of the facility
 749-5   for diversion to other purposes.
 749-6         (d)  The laws of this state other than this chapter do not
 749-7   apply to the authorization or execution of an encumbrance entered
 749-8   into under this chapter or to the granting of a franchise under
 749-9   this chapter.  (V.A.C.S. Art. 1105c, Sec. 9.)
749-10            (Sections 317.113-317.150 reserved for expansion
749-11                     SUBCHAPTER D.  REFUNDING BONDS
749-12         Sec. 317.151.  APPLICABILITY OF LAW RELATING TO ORIGINAL
749-13   BONDS.  The provisions of this chapter relating to original bonds
749-14   apply to  refunding bonds issued under this chapter to the extent
749-15   the provisions can be made to apply.  (V.A.C.S. Art. 1105c, Sec.
749-16   11(e).)
749-17         Sec. 317.152.  AUTHORITY TO ISSUE TAX REFUNDING BONDS.  (a)
749-18   The governing body of a municipality by ordinance may issue tax
749-19   bonds under this chapter to refund outstanding original or
749-20   refunding bonds issued by the municipality under this chapter and
749-21   the accrued interest on those bonds.
749-22         (b)  Refunding bonds issued under this section may be issued
749-23   to refund tax bonds of more than one series or issue. (V.A.C.S.
749-24   Art. 1105c,  Secs. 11(a) (part), (c) (part).)
749-25         Sec. 317.153.  AUTHORITY TO ISSUE REVENUE REFUNDING BONDS.
749-26   The governing body of a municipality by ordinance may issue revenue
749-27   bonds under this chapter to refund outstanding original or
 750-1   refunding revenue bonds issued by the municipality under this
 750-2   chapter and the accrued interest on those bonds. (V.A.C.S.
 750-3   Art. 1105c, Secs. 11(b) (part), (c) (part).)
 750-4         Sec. 317.154.  TERMS OF ISSUANCE OF REVENUE REFUNDING BONDS.
 750-5   (a)  Revenue refunding bonds may:
 750-6               (1)  be combined with new or original revenue bonds
 750-7   into one series or issue;
 750-8               (2)  be issued to refund bonds of more than one series
 750-9   or issue;
750-10               (3)  combine the pledges securing the bonds to be
750-11   refunded to secure the revenue refunding bonds; or
750-12               (4)  be secured by a pledge of other or additional net
750-13   revenue.
750-14         (b)  Revenue refunding bonds may bear interest at a rate
750-15   higher than that of the bonds to be refunded. (V.A.C.S. Art. 1105c,
750-16   Sec. 11(b) (part).)
750-17         Sec. 317.155.  REGISTRATION OF REFUNDING BONDS BY
750-18   COMPTROLLER.  (a)  Except as provided by Subsection (b), the
750-19   comptroller shall register refunding bonds on surrender and
750-20   cancellation of the bonds to be refunded.
750-21         (b)  The comptroller shall register refunding bonds without
750-22   the surrender and cancellation of the bonds to be refunded if the
750-23   ordinance authorizing the issuance of the refunding bonds requires
750-24   that the bonds be sold and the proceeds from the sale be deposited
750-25   where the bonds to be refunded are payable.
750-26         (c)  Refunding bonds to which Subsection (b) applies may be
750-27   issued in an amount sufficient to pay the principal of and interest
 751-1   on the bonds to be refunded to the option or maturity date of the
 751-2   bonds. (V.A.C.S. Art. 1105c, Sec. 11(c) (part).)
 751-3         Sec. 317.156.  ESCROW AGREEMENT.  (a)  The proceeds from
 751-4   revenue refunding bonds that are deposited as provided by Section
 751-5   317.155(b) shall be held under an escrow agreement so that the
 751-6   proceeds will be available to pay the principal of and interest on
 751-7   the bonds to be refunded as each becomes due.
 751-8         (b)  The escrow agreement may provide that the proceeds may,
 751-9   until needed to pay principal and interest, be invested in direct
751-10   obligations of the United States.
751-11         (c)  Interest earned on an investment described by Subsection
751-12   (b) shall be considered revenue of the facility. (V.A.C.S.
751-13   Art. 1105c, Sec. 11(c) (part).)
751-14         SECTION 25.  Subtitle G, Title 6, Transportation Code, is
751-15   amended by adding Chapter 367 to read as follows:
751-16          CHAPTER 367.  MUNICIPAL TOLL BRIDGES OVER RIO GRANDE
751-17        SUBCHAPTER A.  GENERAL AUTHORITY RELATING TO TOLL BRIDGES
751-18         Sec. 367.001.  APPLICABILITY OF SUBCHAPTER.  This subchapter
751-19   applies only to a municipality any part of the municipal boundaries
751-20   of which is within 15 miles of a section of the Rio Grande that
751-21   forms the border between this state and the United Mexican States.
751-22   (V.A.C.S. Art. 1015g-5, Sec. 1.)
751-23         Sec. 367.002.  DEFINITION.  In this subchapter, "toll bridge"
751-24   includes:
751-25               (1)  any part of the physical property comprising a
751-26   toll bridge;
751-27               (2)  a permit, grant, franchise, right, or privilege
 752-1   granted or extended by the United States, the United Mexican
 752-2   States, or a state or political subdivision of either nation, for
 752-3   or related to the construction, maintenance, or operation of a toll
 752-4   bridge, or to the collection of a toll or charge for use of the
 752-5   toll bridge;
 752-6               (3)  an interest in real property in either the United
 752-7   States or the United Mexican States that is held or used for or
 752-8   incident to the construction, maintenance, or operation of the toll
 752-9   bridge or an approach to the toll bridge or for the use or
752-10   occupancy of any building or other structure, appurtenance,
752-11   appliance, road or street, railroad, park, grounds, or convenience
752-12   or facility of any kind relating to or incident to the toll bridge;
752-13               (4)  a building or other structure, appurtenance,
752-14   appliance, equipment, convenience, or facility of any kind held or
752-15   used for or incident to the construction, maintenance, or operation
752-16   of the toll bridge;
752-17               (5)  a lease or contract of any kind for the use or
752-18   occupancy of that real property, building or other structure,
752-19   convenience, appliance, or facility; and
752-20               (6)  any other right or property used for or incident
752-21   to the construction, maintenance, or operation of the toll bridge.
752-22   (V.A.C.S. Art. 1015g-5, Sec. 2(b).)
752-23         Sec. 367.003.  AUTHORITY OF MUNICIPALITY IN RELATION TO TOLL
752-24   BRIDGE.  For any public purpose, a municipality may acquire,
752-25   construct, improve, enlarge, equip, operate, or maintain a toll
752-26   bridge over a section of the Rio Grande that forms the border
752-27   between this state and the United Mexican States.  (V.A.C.S.
 753-1   Art. 1015g-5, Sec. 2(a).)
 753-2         Sec. 367.004.  AUTHORITY OF MUNICIPALITY TO ENTER INTO
 753-3   CONTRACTS.  For the purpose of taking an action authorized by this
 753-4   subchapter, a municipality may enter into and perform a contract,
 753-5   agreement, or undertaking required by the United States, the United
 753-6   Mexican States, or a department, officer, governmental agency, or
 753-7   public authority of either nation.  (V.A.C.S. Art. 1015g-5, Sec.
 753-8   2(c).)
 753-9         Sec. 367.005.  AUTHORITY TO ISSUE REVENUE BONDS.  To provide
753-10   money to acquire, construct, improve, enlarge, or equip a toll
753-11   bridge, a part of a toll bridge, or a related building, structure,
753-12   or other facility for a public purpose, the governing body of a
753-13   municipality may issue revenue bonds that are payable from and
753-14   secured by a lien on and pledge of all or any part of the revenue,
753-15   income, or receipts the municipality receives from its ownership
753-16   and operation of:
753-17               (1)  a portion of a toll bridge over the Rio Grande;
753-18   and
753-19               (2)  any other property, building, structure, activity,
753-20   or facility.  (V.A.C.S. Art. 1015g-5, Sec. 3(a).)
753-21         Sec. 367.006.  INTERIM FINANCING.  (a)  Pending the issuance
753-22   of revenue bonds under this subchapter, a municipality may:
753-23               (1)  spend, in connection with a toll bridge, money
753-24   that is not required by law to be used for another purpose; or
753-25               (2)  issue notes for an expenditure described by
753-26   Subdivision (1).
753-27         (b)  A municipality may use proceeds of revenue bonds issued
 754-1   under this subchapter to repay money spent under Subsection (a).
 754-2         (c)  Notes issued under Subsection (a) may have any
 754-3   characteristic the governing body considers appropriate and:
 754-4               (1)  bear rates of interest, be payable from available
 754-5   sources, and be secured in the same manner as revenue bonds issued
 754-6   under this subchapter; or
 754-7               (2)  be payable from:
 754-8                     (A)  the proceeds of refunding bonds issued under
 754-9   this subchapter; or
754-10                     (B)  both revenue bonds and refunding bonds.
754-11   (V.A.C.S. Art. 1015g-5, Sec. 3(b).)
754-12         Sec. 367.007.  MATURITY.  A bond issued under this subchapter
754-13   must mature not later than 50 years after its date of issuance.
754-14   (V.A.C.S. Art. 1015g-5, Sec. 4(a) (part).)
754-15         Sec. 367.008.  PLEDGE OF REVENUE.  A municipality may pledge
754-16   to the payment of bonds issued under this subchapter, including the
754-17   principal of, interest on, and any other amount required or
754-18   permitted to be paid in connection with the bonds, all or any part
754-19   of its revenue, income, or receipts from:
754-20               (1)  a toll or charge authorized by Section 367.011; or
754-21               (2)  another resource.  (V.A.C.S. Art. 1015g-5, Sec.
754-22   6(a) (part).)
754-23         Sec. 367.009.  ADDITIONAL SECURITY.  (a)  Bonds issued under
754-24   this subchapter may be additionally secured by:
754-25               (1)  a mortgage or deed of trust on any real property
754-26   owned by the municipality; or
754-27               (2)  a chattel mortgage or lien on any personal
 755-1   property appurtenant to that real property.
 755-2         (b)  The governing body of the municipality may authorize the
 755-3   execution of a trust indenture, mortgage, deed of trust, or other
 755-4   form of encumbrance as evidence of the debt.
 755-5         (c)  The municipality may pledge to the payment of the bonds
 755-6   all or part of any grant, donation, revenue, or income received or
 755-7   to be received from the United States or any other public or
 755-8   private source whether under an agreement or otherwise.  (V.A.C.S.
 755-9   Art. 1015g-5, Secs. 6(b), (c).)
755-10         Sec. 367.010.  ADDITIONAL BONDS.  An ordinance authorizing
755-11   the issuance of bonds under this subchapter may provide for the
755-12   subsequent issuance of additional parity or subordinate lien bonds
755-13   under terms specified in the ordinance.  (V.A.C.S. Art. 1015g-5,
755-14   Sec. 4(a) (part).)
755-15         Sec. 367.011.  TOLLS AND CHARGES.  (a)  The governing body of
755-16   a municipality may impose and collect tolls and other charges for
755-17   the use or availability of a toll bridge of the municipality.
755-18         (b)  The governing body of the municipality shall impose and
755-19   collect pledged tolls and charges in an amount that will be at
755-20   least sufficient, with any other pledged resource, to provide for
755-21   the payment of:
755-22               (1)  principal of and interest on and any other amount
755-23   required to be paid in connection with the bonds; and
755-24               (2)  to the extent required by the ordinance
755-25   authorizing issuance of the bonds:
755-26                     (A)  expenses incurred in connection with the
755-27   bonds; and
 756-1                     (B)  operation, maintenance, and other expenses
 756-2   in connection with the toll bridge.  (V.A.C.S. Art. 1015g-5, Secs.
 756-3   5, 6(a) (part).)
 756-4         Sec. 367.012.  PUBLIC PURPOSE.  The acquisition,
 756-5   construction, improvement, enlargement, or equipment by a
 756-6   municipality of property or a building, structure, or other
 756-7   facility for lease to the United States for use in performing a
 756-8   federal governmental function in the municipality or at or near and
 756-9   relating to a toll bridge of the municipality is a public purpose
756-10   and a proper municipal function, regardless of whether the toll
756-11   bridge or the federal facility relating to the toll bridge is
756-12   located inside or outside the municipality.  (V.A.C.S.
756-13   Art. 1015g-5, Sec. 7 (part).)
756-14         Sec. 367.013.  LEASE OR RENTAL OF FACILITY TO UNITED STATES.
756-15   A municipality may lease or rent to the United States property or a
756-16   building, structure, or other facility acquired, constructed,
756-17   improved, enlarged, or equipped in whole or in part with proceeds
756-18   from the sale of bonds issued under this subchapter.  (V.A.C.S.
756-19   Art. 1015g-5, Sec. 7 (part).)
756-20         Sec. 367.014.  REFUNDING BONDS AND NOTES.  (a)  A
756-21   municipality may refund or otherwise refinance bonds or notes
756-22   issued under this subchapter by issuing refunding bonds under any
756-23   terms provided by ordinance of the governing body of the
756-24   municipality.
756-25         (b)  All appropriate provisions of this subchapter apply to
756-26   the refunding bonds.  The refunding bonds shall be issued in the
756-27   manner provided by this subchapter for other bonds.
 757-1         (c)  The refunding bonds may be sold and delivered in amounts
 757-2   sufficient to pay the principal of and interest and any redemption
 757-3   premium on the bonds or notes to be refunded, at maturity or on any
 757-4   redemption date.
 757-5         (d)  The refunding bonds may be issued to be exchanged for
 757-6   the bonds or notes to be refunded.  In that case, the comptroller
 757-7   shall register the refunding bonds and deliver them to the holder
 757-8   of the bonds or notes to be refunded as provided by the ordinance
 757-9   authorizing the refunding bonds.  The exchange may be made in one
757-10   delivery or in installment deliveries.  (V.A.C.S. Art. 1015g-5,
757-11   Secs. 9(a), (b).)
757-12         Sec. 367.015.  SALE OF BONDS OR NOTES.  A municipality may
757-13   sell bonds or notes issued under this subchapter in the manner and
757-14   on the terms provided by the ordinance authorizing the issuance of
757-15   the bonds or notes.  (V.A.C.S. Art. 1015g-5, Sec. 4(b) (part).)
757-16         Sec. 367.016.  BONDS AND NOTES NOT PAYABLE FROM TAXES.  A
757-17   bond or note issued under this subchapter:
757-18               (1)  is payable  only  from  the  revenue  or  another
757-19   resource of the municipality; and
757-20               (2)  is not a tax obligation of the municipality.
757-21   (V.A.C.S. Art. 1015g-5, Sec. 8.)
757-22         Sec. 367.017.  CONFLICT WITH OTHER LAW.  When bonds or notes
757-23   are being issued under this subchapter, to the extent of any
757-24   conflict between this subchapter and another law, this subchapter
757-25   controls.  (V.A.C.S. Art. 1015g-5, Sec. 12 (part).)
757-26            (Sections 367.018-367.050 reserved for expansion
757-27           SUBCHAPTER B.  ACQUIRING EXISTING BRIDGE; BUILDING
 758-1                    REPLACEMENT OR ADDITIONAL BRIDGE
 758-2         Sec. 367.051.  AUTHORITY TO ACQUIRE TOLL BRIDGE.  (a)  A
 758-3   municipality may acquire a toll bridge that is located over a
 758-4   section of the Rio Grande that forms the border between this state
 758-5   and the United Mexican States and that is inside or within 15 miles
 758-6   of its municipal boundaries by purchasing:
 758-7               (1)  the entire toll bridge; or
 758-8               (2)  that part of the toll bridge that is located in
 758-9   this state.
758-10         (b)  The municipality is not required to:
758-11               (1)  give or publish notice of its intent to acquire a
758-12   toll bridge under this subchapter; or
758-13               (2)  advertise or call for competitive bids in
758-14   connection with the acquisition of a toll bridge under this
758-15   subchapter.
758-16         (c)  The municipality may acquire a toll bridge owned by a
758-17   private corporation by purchasing the toll bridge itself or by
758-18   purchasing all of the capital stock of the corporation or a
758-19   sufficient amount of the stock as required by law to dissolve and
758-20   liquidate the corporation.  The municipality may take title to the
758-21   stock in the name of the municipality or in the name of a trustee
758-22   for the municipality.  After purchasing the stock, the municipality
758-23   or its trustee shall:
758-24               (1)  vote its shares in the corporation as necessary to
758-25   vest title to the toll bridge, together with any associated right
758-26   or property described by Section 367.052 to be acquired in
758-27   connection with the acquisition of the toll bridge, in the
 759-1   municipality; and
 759-2               (2)  immediately dissolve and liquidate the
 759-3   corporation, pay its debts, liabilities, and obligations, wind up
 759-4   its business and affairs, and convey the properties to the
 759-5   municipality.
 759-6         (d)  The purchase and acquisition of toll bridge property or
 759-7   stock in a corporation under this section must be made at the price
 759-8   and on the terms agreed on by the owners of the property or stock
 759-9   and the governing body of the municipality.  (V.A.C.S. Art. 1015g,
759-10   Secs. 1 (part), 4 (part), 13 (part).)
759-11         Sec. 367.052.  RIGHTS AND PROPERTIES ASSOCIATED WITH TOLL
759-12   BRIDGE.  When a municipality acquires a toll bridge under Section
759-13   367.051, the municipality may, as determined by the governing body
759-14   of the municipality, acquire any or all of the following items in
759-15   connection with the toll bridge:
759-16               (1)  a permit, grant, franchise, right, or privilege
759-17   granted or extended by the United States, the United Mexican
759-18   States, or a department, officer, agency, governmental authority,
759-19   state, municipality, or political subdivision of either nation, for
759-20   or related to the construction, maintenance, or operation of the
759-21   toll bridge or the collection of a toll or charge for the use of
759-22   the toll bridge;
759-23               (2)  an interest in real property in either the United
759-24   States or the United Mexican States that is held or used for or
759-25   incident to the construction, maintenance, or operation of the toll
759-26   bridge or an approach to it, or for the use or occupancy of any
759-27   building or other structure, appurtenance, appliance, road or
 760-1   street, park, grounds, or convenience or facility of any kind
 760-2   relating to or incident to the construction, maintenance, or
 760-3   operation of the toll bridge;
 760-4               (3)  a building or other structure, appurtenance,
 760-5   appliance, equipment, convenience, or facility of any kind held or
 760-6   used for or incident to the construction, maintenance, or operation
 760-7   of the toll bridge;
 760-8               (4)  a lease or contract of any kind for the use or
 760-9   occupancy of that real property or a building or other structure,
760-10   convenience, appliance, or facility; or
760-11               (5)  any other right or property used for or incident
760-12   to the construction, maintenance, or operation of the toll bridge.
760-13   (V.A.C.S. Art. 1015g, Secs. 1 (part), 4 (part).)
760-14         Sec. 367.053.  LIBERAL CONSTRUCTION.  This subchapter shall
760-15   be liberally construed to effect its purposes.  (V.A.C.S.
760-16   Art. 1015g, Sec. 18.)
760-17         Sec. 367.054.  POWERS TO BE EXERCISED BY ORDINANCE; ELECTION
760-18   NOT REQUIRED.  (a)  The governing body of a municipality may
760-19   exercise a power, right, privilege, or function conferred by this
760-20   subchapter on the municipality only by adopting an ordinance to
760-21   authorize the action.
760-22         (b)  A referendum or election by the voters of the
760-23   municipality is not necessary to authorize:
760-24               (1)  the adoption of an ordinance under Subsection (a);
760-25   or
760-26               (2)  the taking of an action to accomplish a purpose of
760-27   this subchapter.  (V.A.C.S. Art. 1015g, Secs. 1 (part), 3 (part), 8
 761-1   (part), 13 (part), 15.)
 761-2         Sec. 367.055.  GENERAL POWERS OF MUNICIPALITY ACQUIRING TOLL
 761-3   BRIDGE.  (a)  A municipality that acquires a toll bridge under this
 761-4   subchapter may:
 761-5               (1)  maintain, operate, own, hold, control, repair,
 761-6   improve, extend, or replace the toll bridge;
 761-7               (2)  renew or extend an existing franchise and obtain a
 761-8   new or additional franchise for the bridge; and
 761-9               (3)  take any action required for maintaining or
761-10   operating the bridge, conducting the bridge's business, or
761-11   providing services to the public and to the users of the bridge.
761-12         (b)  To accomplish the purposes of this section the
761-13   municipality may enter into and perform a contract, agreement, or
761-14   undertaking of any kind required by the United States or the United
761-15   Mexican States or a department, officer, governmental agency, or
761-16   public authority of either nation.  (V.A.C.S. Art. 1015g, Sec.  2.)
761-17         Sec. 367.056.  RECREATIONAL FACILITIES.  (a)  In connection
761-18   with the maintenance and operation of the toll bridge, a
761-19   municipality may acquire real property that is either inside or
761-20   outside the municipal boundaries and that is adjacent to the toll
761-21   bridge or the municipality to construct, maintain, or operate a
761-22   park, recreational grounds or facilities, a camp, quarters,
761-23   accommodations, or other facility for the use and convenience of
761-24   the public.
761-25         (b)  The municipality may manage, police, and regulate those
761-26   facilities and may adopt and enforce reasonable rules for those
761-27   facilities without regard to whether the toll bridge is located
 762-1   inside or outside the municipality.
 762-2         (c)  The governing body of the municipality may impose and
 762-3   collect a fee, rental, or other charge for the use of a facility
 762-4   established under this section.  The charge must be just,
 762-5   reasonable, and nondiscriminatory.  (V.A.C.S. Art. 1015g, Sec. 5.)
 762-6         Sec. 367.057.  TOLLS AND CHARGES.  (a)  A municipality that
 762-7   acquires a toll bridge under this subchapter or that owns or
 762-8   controls an international toll bridge may impose tolls and other
 762-9   charges for the use of the bridge and for the transportation of
762-10   persons or property, including passengers, vehicles, or freight and
762-11   commodities, over the bridge.
762-12         (b)  In accordance with any applicable permit or franchise
762-13   granted by a governmental authority, the tolls and other charges
762-14   must be just, reasonable, nondiscriminatory, and sufficient to
762-15   provide revenue in an amount that is sufficient to:
762-16               (1)  pay all expenses necessary to maintain and operate
762-17   the toll bridge;
762-18               (2)  make necessary payments and comply with any
762-19   applicable permit or franchise;
762-20               (3)  pay when due the principal of and interest on all
762-21   bonds or warrants issued under this subchapter;
762-22               (4)  pay when due all sinking fund or reserve fund
762-23   payments agreed to be made in connection with bonds or warrants
762-24   issued under this subchapter and payable from that revenue;
762-25               (5)  comply with any agreement made with the holders of
762-26   bonds or warrants issued under this subchapter or with any person
762-27   on behalf of those holders; and
 763-1               (6)  recover a reasonable rate of return on invested
 763-2   capital.
 763-3         (c)  The governing body of the municipality may use revenue
 763-4   received under this section in excess of the amount required by
 763-5   Subsection (b) to:
 763-6               (1)  establish a reasonable depreciation and emergency
 763-7   fund;
 763-8               (2)  retire by purchase and cancellation or by
 763-9   redemption any outstanding bonds or warrants issued under this
763-10   subchapter;
763-11               (3)  provide necessary budgetary support to local
763-12   government for public purposes and the general welfare; or
763-13               (4)  accomplish the purposes of this subchapter.
763-14         (d)  This subchapter does not deprive this state, the United
763-15   States, or an agency with jurisdiction of its power:
763-16               (1)  to regulate or control tolls and other charges to
763-17   be collected for a purpose listed in Subsection (b) or (c); or
763-18               (2)  to provide for bridges over the river that will be
763-19   used free of any tolls or charges.
763-20         (e)  Until bonds or warrants issued under this subchapter
763-21   have been paid and discharged, including all interest on the bonds
763-22   or warrants, interest on unpaid interest installments on the bonds
763-23   or warrants, other costs or expenses incurred in connection with
763-24   any acts or proceedings taken by or on behalf of the holders of the
763-25   bonds or warrants, and all other obligations of the municipality
763-26   incurred in connection with the bonds or warrants:
763-27               (1)  the municipality may not provide free use of the
 764-1   toll bridge to any person; and
 764-2               (2)  this state pledges to and agrees with the
 764-3   purchasers and successive holders of the bonds or warrants that it
 764-4   will not:
 764-5                     (A)  limit or alter the power of a municipality
 764-6   to impose tolls and other charges under this section sufficient to
 764-7   pay the items listed in Subsection (b) or (c); or
 764-8                     (B)  take any action that will impair the rights
 764-9   or remedies of the holders of the bonds or warrants or of persons
764-10   acting on their behalf.  (V.A.C.S. Art. 1015g, Sec. 3 (part).)
764-11         Sec. 367.058.  AUTHORITY TO BORROW MONEY OR ACCEPT FEDERAL
764-12   ASSISTANCE.  (a)  To accomplish the purposes of this subchapter, a
764-13   municipality may:
764-14               (1)  borrow money from any person or corporation; or
764-15               (2)  borrow money or accept grants from the United
764-16   States or a corporation or agency created by or authorized to act
764-17   as an agency of the United States.
764-18         (b)  In connection with a loan or grant under Subsection
764-19   (a)(2), a municipality may enter into any related agreement that
764-20   the United States, corporation, or agency requires.  (V.A.C.S.
764-21   Art. 1015g, Sec. 6.)
764-22         Sec. 367.059.  AUTHORITY TO ISSUE REVENUE BONDS.  (a)  The
764-23   governing body of a municipality may issue, sell, and deliver
764-24   revenue bonds to accomplish the purposes of this subchapter.  The
764-25   municipality may use the bonds or the proceeds of the sale of the
764-26   bonds to acquire all or part of a toll bridge under this subchapter
764-27   or may exchange the bonds for property to accomplish the purposes
 765-1   of this subchapter.
 765-2         (b)  The governing body may issue the bonds and use a bond or
 765-3   bond proceeds as provided by this subchapter without:
 765-4               (1)  giving or publishing notice of the municipality's
 765-5   intent to take that action; or
 765-6               (2)  advertising or calling for competitive bids in
 765-7   connection with that action.  (V.A.C.S. Art. 1015g, Secs. 7, 13
 765-8   (part), 13(c) (part).)
 765-9         Sec. 367.060.  BONDS AND WARRANTS NOT PAYABLE FROM TAXES.
765-10   (a)  Bonds and warrants issued under this subchapter are not a debt
765-11   of the municipality that issues them and are a charge only against:
765-12               (1)  the pledged revenues of the toll bridge; and
765-13               (2)  the property comprising the toll bridge, if a lien
765-14   is given on that property.
765-15         (b)  A bond or warrant issued under this subchapter must
765-16   include substantially the following provision:  "The holder of this
765-17   obligation is not entitled to demand payment of this obligation out
765-18   of any money raised by taxation."  (V.A.C.S. Art. 1015g, Sec.
765-19   13(c) (part).)
765-20         Sec. 367.061.  MORTGAGE OR PLEDGE OF REVENUE TO SECURE BONDS.
765-21   To accomplish any purpose of this subchapter, the governing body of
765-22   a municipality may with respect to bonds issued under this
765-23   subchapter:
765-24               (1)  mortgage or pledge all or part of:
765-25                     (A)  any interest in a toll bridge of the
765-26   municipality, together with any associated right or property
765-27   described by Section 367.052, or any other property acquired or to
 766-1   be acquired with the bonds or the proceeds of the sale of the
 766-2   bonds; or
 766-3                     (B)  the net or gross revenue of any property
 766-4   described by Paragraph (A);
 766-5               (2)  secure the payment of the principal of and
 766-6   interest on the bonds and of the sinking fund and reserve fund
 766-7   agreed to be established in connection with the bonds; and
 766-8               (3)  enter into any covenant or agreement with the
 766-9   purchasers of the bonds or any person on behalf of those purchasers
766-10   with respect to the bonds to:
766-11                     (A)  secure the payments described by Subdivision
766-12   (2); and
766-13                     (B)  provide rights and remedies to the
766-14   purchasers or holders of the bonds or any person on their behalf.
766-15   (V.A.C.S. Art. 1015g, Sec. 8 (part).)
766-16         Sec. 367.062.  MATURITY.  The governing body of a
766-17   municipality shall determine the maturity of bonds issued under
766-18   this subchapter.  (V.A.C.S. Art. 1015g, Sec. 9 (part).)
766-19         Sec. 367.063.  SALE OR EXCHANGE OF BONDS.  A bond issued
766-20   under this subchapter may be:
766-21               (1)  sold for cash at a public or private sale;
766-22               (2)  issued in exchange for property of any kind or an
766-23   interest in property of any kind, as the governing body of the
766-24   municipality determines is necessary and proper to accomplish a
766-25   purpose of this subchapter; or
766-26               (3)  issued in exchange for a matured or unmatured bond
766-27   of the same issue and in the same principal amount.  (V.A.C.S.
 767-1   Art. 1015g, Sec. 10 (part).)
 767-2         Sec. 367.064.  DEPOSIT OF PROCEEDS.  The proceeds of the sale
 767-3   of bonds sold for cash shall be deposited and paid out under the
 767-4   terms that are agreed to by the governing body of the municipality
 767-5   and the purchasers of the bonds.  (V.A.C.S. Art. 1015g, Sec.  11.)
 767-6         Sec. 367.065.  AUTHORITY TO ISSUE BONDS OR WARRANTS TO
 767-7   REPAIR, IMPROVE, OR BUILD TOLL BRIDGE.  (a)  A municipality that
 767-8   has acquired a toll bridge under this subchapter may issue and
 767-9   deliver revenue bonds or revenue time warrants:
767-10               (1)  to repair, improve, alter, reconstruct, or replace
767-11   the bridge;
767-12               (2)  to build an additional bridge; or
767-13               (3)  for one or more of those purposes.
767-14         (b)  The municipality shall issue the bonds or warrants:
767-15               (1)  in the manner prescribed by this subchapter; and
767-16               (2)  subject to any restriction in an ordinance
767-17   authorizing or a deed of indenture securing the original or a
767-18   subsequent issue of toll bridge bonds or warrants.  (V.A.C.S.
767-19   Art. 1015g, Secs. 13(b), 13(c) (part).)
767-20         Sec. 367.066.  TAX EXEMPTIONS.  Bonds issued under this
767-21   subchapter are exempt from taxation by this state or a municipality
767-22   or other political subdivision of this state. (V.A.C.S. Art. 1015g,
767-23   Sec. 12 (part).)
767-24         Sec. 367.067.  LIMITATIONS ON MUNICIPAL AUTHORITY.  This
767-25   subchapter does not authorize a municipality to:
767-26               (1)  impose or collect a tax or assessment or pledge
767-27   the credit of this state; or
 768-1               (2)  issue, sell, or deliver a bond, create an
 768-2   obligation, incur a liability, or enter an agreement to be paid,
 768-3   performed, met, or discharged using any tax or assessment.
 768-4   (V.A.C.S. Art. 1015g, Sec. 14.)
 768-5         Sec. 367.068.  APPLICABILITY OF AND CONFLICTS WITH OTHER LAW.
 768-6   (a)  Sections 252.046, 252.047, and 252.048, Local Government Code,
 768-7   Chapter 1253, Government Code, and Subchapter B, Chapter 1502,
 768-8   Government Code, apply, except as provided by Section 367.051,
 768-9   Section 367.059, or another provision of this subchapter, to:
768-10               (1)  the purchase of a toll bridge under this
768-11   subchapter;
768-12               (2)  the issuance, sale, or delivery of bonds under
768-13   this subchapter;
768-14               (3)  the manner of securing payment of the bonds;
768-15               (4)  the enforcement of the obligations relating to the
768-16   bonds;
768-17               (5)  the rights and remedies of the owners or holders
768-18   of the bonds or of any person acting on their behalf;
768-19               (6)  the maintenance or operation of property acquired
768-20   under this subchapter; and
768-21               (7)  the accomplishment of any other purpose of this
768-22   subchapter.
768-23         (b)  To the extent of a conflict between this subchapter and
768-24   another law, this subchapter controls. (V.A.C.S. Art. 1015g, Sec.
768-25   13 (part).)
768-26            (Sections 367.069-367.100 reserved for expansion
768-27      SUBCHAPTER C.  BONDS FOR REPAIR OR IMPROVEMENT OF TOLL BRIDGE
 769-1         Sec. 367.101.  APPLICABILITY OF SUBCHAPTER.  This subchapter
 769-2   applies only to a municipality that owns that portion of an
 769-3   international toll bridge over the Rio Grande that is located in
 769-4   the United States.  (V.A.C.S.  Art. 717h, Sec. 1 (part).)
 769-5         Sec. 367.102.  AUTHORITY TO ISSUE REVENUE BONDS.  The
 769-6   municipality may, in compliance with Subtitles A, C, D, and E,
 769-7   Title 9, Government Code, issue bonds payable from the net revenue
 769-8   derived from the operation of the bridge to:
 769-9               (1)  repair or improve the bridge;
769-10               (2)  acquire an approach to the bridge; or
769-11               (3)  construct a building to be used in connection with
769-12   the bridge.  (V.A.C.S. Art. 717h, Sec. 1 (part).)
769-13         Sec. 367.103.  ADDITIONAL BONDS.  (a)  The municipality may
769-14   issue additional revenue bonds to the extent permitted or
769-15   authorized by the provisions of or the proceedings relating to
769-16   outstanding bonds that are payable from the net revenue from the
769-17   operation of the bridge, including any trust indenture securing the
769-18   outstanding bonds.
769-19         (b)  As permitted or authorized by those provisions and
769-20   proceedings, the additional bonds may be secured by a pledge of and
769-21   lien on the net revenue that are:
769-22               (1)  junior to the pledge and lien securing the
769-23   outstanding bonds; or
769-24               (2)  on a parity with the outstanding bonds.  (V.A.C.S.
769-25   Art. 717h, Sec.  2.)
769-26         SECTION 26.  CONFORMING AMENDMENT.  Title 5, Water Code, is
769-27   amended by adding Chapter 152 to read as follows:
 770-1               CHAPTER 152.  RIVER AUTHORITIES ENGAGED IN
 770-2                DISTRIBUTION AND SALE OF ELECTRIC ENERGY
 770-3                    SUBCHAPTER A.  GENERAL PROVISIONS
 770-4         Sec. 152.001.  APPLICABILITY.  (a)  This chapter applies only
 770-5   to a river authority that is engaged in the distribution and sale
 770-6   of electric energy to the public.
 770-7         (b)  This chapter does not apply to any litigation instituted
 770-8   before May 28, 1981, that questions the legality of an act taken or
 770-9   a proceeding conducted by a river authority before that date.
770-10   (V.A.C.S. Art. 717p, Secs. 1 (part), 2(a) (part), 3(a) (part),
770-11   4A(a) (part), 4B(a) (part), 5.)
770-12         Sec. 152.002.  APPLICATION OF OTHER LAW.  (a)  Unless this
770-13   chapter expressly provides otherwise, a law that limits, restricts,
770-14   or imposes an additional requirement on a matter authorized by this
770-15   chapter does not apply to an action or proceeding under this
770-16   chapter.
770-17         (b)  Chapters 1202 and 1204, Government Code, apply to
770-18   revenue bonds, notes, or other obligations issued under this
770-19   chapter.  (V.A.C.S. Art. 717p, Secs. 1 (part), 4 (part), 4A(g)
770-20   (part).)
770-21            (Sections 152.003-152.050 reserved for expansion
770-22          SUBCHAPTER B.  NONPROFIT CORPORATION ACTING ON BEHALF
770-23                           OF RIVER AUTHORITY
770-24         Sec. 152.051.  CREATION OF NONPROFIT CORPORATION.  (a)  The
770-25   board of directors of a river authority by order may create one or
770-26   more nonprofit corporations to act on behalf of the river authority
770-27   as its authority and instrumentality.
 771-1         (b)  The Texas Non-Profit Corporation Act (Article 1396-1.01
 771-2   et seq., Vernon's Texas Civil Statutes) applies to a corporation
 771-3   created under this section.
 771-4         (c)  Sections 5-20 and 33-36, Development Corporation Act of
 771-5   1979 (Article 5190.6, Vernon's Texas Civil Statutes), apply to a
 771-6   corporation created under this section, except that in those
 771-7   sections:
 771-8               (1)  a reference to that Act includes this chapter; and
 771-9               (2)  a reference to a unit includes a river authority
771-10   to which this chapter applies.  (V.A.C.S. Art. 717p, Secs. 4A(a)
771-11   (part), (e).)
771-12         Sec. 152.052.  POWERS OF NONPROFIT CORPORATION.  (a)  A
771-13   corporation created under Section 152.051 may exercise any power of
771-14   the creating river authority except a power relating to solid waste
771-15   management activities or activities as an exempt wholesale
771-16   generator, but including the authority to acquire, develop,
771-17   operate, and sell fuel, fuel reserves, and mineral interests.  In
771-18   this subsection, "exempt wholesale generator" has the meaning
771-19   assigned by Section 32(a), Public Utility Holding Company Act of
771-20   1935 (15 U.S.C. Section 79z-5a(a)).
771-21         (b)  When exercising a power under this chapter, a
771-22   corporation created under Section 152.051 and the board of
771-23   directors of the corporation have the same powers as the creating
771-24   river authority and the authority's board, including the power to
771-25   issue bonds or other obligations or otherwise borrow money on
771-26   behalf of the river authority to accomplish any purpose of the
771-27   corporation.
 772-1         (c)  With regard to the issuance of an obligation, the board
 772-2   of directors of a corporation created under Section 152.051 may
 772-3   exercise the powers granted to the governing body of:
 772-4               (1)  an issuer under Chapters 1201 and 1371, Government
 772-5   Code; and
 772-6               (2)  a public agency under Chapter 1204, Government
 772-7   Code.  (V.A.C.S. Art. 717p, Secs. 4A(a) (part), (b), (g) (part),
 772-8   (h).)
 772-9         Sec. 152.053.  BOARD OF DIRECTORS.  (a)  The board of
772-10   directors of the river authority shall appoint the directors of a
772-11   corporation created under Section 152.051.
772-12         (b)  A member of the river authority's board of directors may
772-13   serve as a member of the corporation's board of directors.
772-14         (c)  The directors of the corporation serve at the will of
772-15   the river authority's board of directors.  (V.A.C.S. Art. 717p,
772-16   Sec. 4A(c).)
772-17         Sec. 152.054.  SUPERVISION BY BOARD OF DIRECTORS OF RIVER
772-18   AUTHORITY.  (a)  The budget of a corporation created under Section
772-19   152.051 must be approved by the board of directors of the river
772-20   authority.
772-21         (b)  The activities of the corporation are subject to the
772-22   continuing review and supervision of the river authority's board of
772-23   directors.
772-24         (c)  The issuance of bonds or other obligations under this
772-25   chapter by a corporation created under Section 152.051 must be
772-26   approved by the board of directors of the river authority.
772-27   (V.A.C.S.  Art. 717p, Secs. 4A(d), (g) (part).)
 773-1         Sec. 152.055.  LIABILITY OF CORPORATE PROPERTY FOR TAXES AND
 773-2   SPECIAL ASSESSMENTS.  The property of a corporation created under
 773-3   Section 152.051 is not exempt from taxes or special assessments
 773-4   imposed by this state or a municipality or other political
 773-5   subdivision of this state.  (V.A.C.S. Art. 717p, Sec. 4A(f).)
 773-6            (Sections 152.056-152.100 reserved for expansion
 773-7          SUBCHAPTER C.  ENERGY OR WATER CONSERVATION PROGRAMS
 773-8         Sec. 152.101.  AUTHORITY TO PARTICIPATE IN ENERGY OR WATER
 773-9   CONSERVATION PROGRAM.  (a)  A river authority may undertake,
773-10   sponsor, initiate, coordinate, or otherwise participate in a
773-11   program intended to conserve electric energy or water, including a
773-12   program that:
773-13               (1)  encourages the more efficient use of electric
773-14   energy or water;
773-15               (2)  reduces the total use of electric energy or water;
773-16   or
773-17               (3)  reduces maximum total electric generating capacity
773-18   requirements through load management techniques.
773-19         (b)  A determination by the board of directors of a river
773-20   authority that a program described by Subsection (a)  is intended
773-21   and expected to accomplish a purpose described by that subsection
773-22   is conclusive with respect to whether the program serves the stated
773-23   purpose.  (V.A.C.S. Art. 717p, Sec. 2(a) (part).)
773-24         Sec. 152.102.  PARTICIPATION IN CONSERVATION PROGRAM BY
773-25   PERSON OTHER THAN RIVER AUTHORITY.  (a)  A conservation program may
773-26   involve a grant or loan of money, services, or equipment to a
773-27   person or entity other than the river authority engaged in the
 774-1   program.
 774-2         (b)  Any person, including an individual or any public or
 774-3   private entity, may enter into an agreement with a river authority
 774-4   with respect to a conservation program.
 774-5         (c)  A person participating in or receiving a benefit from a
 774-6   conservation program shall comply with the requirements of the
 774-7   program.  (V.A.C.S. Art. 717p, Sec. 2(b).)
 774-8         Sec. 152.103.  PUBLIC PURPOSE AND GOVERNMENTAL FUNCTION.
 774-9   Each conservation program is a public purpose and governmental
774-10   function of a river authority to conserve the natural resources of
774-11   this state, including the air and the waters of the rivers and
774-12   streams of this state, electricity, and fuels used in the
774-13   generation of electricity, in accordance with Section 59(a),
774-14   Article XVI, Texas Constitution.  (V.A.C.S. Art. 717p, Sec. 2(c).)
774-15            (Sections 152.104-152.150 reserved for expansion
774-16              SUBCHAPTER D.  ECONOMIC DEVELOPMENT PROGRAMS
774-17         Sec. 152.151.  DEFINITION.  In this subchapter, "economic
774-18   development program":
774-19               (1)  includes a program designed to:
774-20                     (A)  encourage economic diversification;
774-21                     (B)  contribute to the health and development of
774-22   a community to improve the attractiveness of the community to
774-23   public and private enterprises; or
774-24                     (C)  improve the quality or quantity of services
774-25   essential for the development of viable communities and economic
774-26   growth, including services related to education,  transportation,
774-27   public safety, recreation, health care, training, community
 775-1   planning, or employment; and
 775-2               (2)  does not include the promotion of retail wheeling
 775-3   of electric power and energy.  (V.A.C.S. Art. 717p, Secs. 3(k),
 775-4   (l).)
 775-5         Sec. 152.152.  APPLICABILITY.  This subchapter applies only
 775-6   to a river authority that generates at least an annual average of
 775-7   55 million kilowatt hours of electric energy.  (V.A.C.S.
 775-8   Art. 717p, Sec. 3(a) (part).)
 775-9         Sec. 152.153.  AUTHORITY FOR ECONOMIC DEVELOPMENT PROGRAM.
775-10   (a)  A river authority may sponsor and participate in an economic
775-11   development program intended to strengthen the economic base and
775-12   further the economic development of this state.
775-13         (b)  A determination by the board of directors of a river
775-14   authority that an economic development program is intended and
775-15   expected to accomplish the program's stated purposes is conclusive
775-16   with respect to whether the program serves the purposes of this
775-17   subchapter.  (V.A.C.S. Art. 717p, Secs. 3(b) (part), (h).)
775-18         Sec. 152.154.  PROGRAM AREA.  An economic development program
775-19   must be within:
775-20               (1)  the territorial boundaries of the sponsoring or
775-21   participating river authority; or
775-22               (2)  the river authority's electric or water service
775-23   area.  (V.A.C.S.  Art. 717p, Sec. 3(b) (part).)
775-24         Sec. 152.155.  ESTABLISHMENT OF PROGRAM.  (a)  An economic
775-25   development program may be established only by formal action of the
775-26   board of directors of a river authority.
775-27         (b)  The board of directors shall:
 776-1               (1)  establish the goals of the program;
 776-2               (2)  impose requirements on persons participating in or
 776-3   receiving a benefit from the program; and
 776-4               (3)  provide restrictions, procedures, and budget
 776-5   limits the board of directors determines are necessary to ensure
 776-6   that the governmental purposes of this subchapter and the program
 776-7   are achieved.  (V.A.C.S. Art. 717p, Sec. 3(c).)
 776-8         Sec. 152.156.  PARTICIPATION IN PROGRAM BY PERSON OTHER THAN
 776-9   RIVER AUTHORITY.  An economic development program may involve the
776-10   granting or lending of money, services, or property to a person
776-11   engaged in an economic development activity, including:
776-12               (1)  a public fire-fighting organization;
776-13               (2)  a governmental body;
776-14               (3)  a nonprofit corporation;
776-15               (4)  a local or regional development council; or
776-16               (5)  any other nonprofit or noncommercial organization.
776-17   (V.A.C.S.  Art. 717p, Sec. 3(d).)
776-18         Sec. 152.157.  STAFFING AND FUNDING OF PROGRAM.  (a)  A river
776-19   authority may employ staff and spend its resources, other than
776-20   money received from an ad valorem tax or a general appropriation,
776-21   to further an economic development program.
776-22         (b)  A river authority may apply for and receive money,
776-23   grants, or other assistance from any source to implement an
776-24   economic development program.  (V.A.C.S. Art. 717p, Sec. 3(e).)
776-25         Sec. 152.158.  AGREEMENT.  A river authority and any public
776-26   or private person may enter into an agreement with respect to an
776-27   economic development program.  (V.A.C.S. Art. 717p, Sec. 3(f).)
 777-1         Sec. 152.159.  GUIDELINES FOR ASSISTANCE TO PUBLIC
 777-2   FIRE-FIGHTING ORGANIZATIONS.  A river authority that proposes to
 777-3   provide scholarships, grants, loans, or financial assistance to a
 777-4   public fire-fighting organization shall adopt guidelines for
 777-5   determining:
 777-6               (1)  eligibility for the assistance;
 777-7               (2)  the amount of any loan, grant, or other assistance
 777-8   the river authority may provide; and
 777-9               (3)  the types of equipment, facilities, education, or
777-10   training for which the assistance may be used.  (V.A.C.S.
777-11   Art. 717p, Sec. 3(g).)
777-12         Sec. 152.160.  RECEIPT OF ELECTRIC SERVICE AS CONDITION FOR
777-13   PARTICIPATION IN PROGRAM.  A river authority may not condition
777-14   participation in or the receipt of a benefit from an economic
777-15   development program on the receipt of electric service from the
777-16   authority.  (V.A.C.S. Art. 717p, Secs. 3(b) (part), (i) (part).)
777-17         Sec. 152.161.  LIMITATIONS ON USE OF PROGRAM.  (a)  A river
777-18   authority may not use an economic development program to:
777-19               (1)  promote fuel switching or the substitution of
777-20   electric power for another fuel or energy source; or
777-21               (2)  provide an economic or other incentive to use
777-22   electric power to preferentially market the use of electric power
777-23   over another fuel or energy source.
777-24         (b)  This section does not limit a power granted to a river
777-25   authority by other law.  (V.A.C.S. Art. 717p, Secs. 3(i) (part),
777-26   (j).)
777-27            (Sections 152.162-152.200 reserved for expansion
 778-1           SUBCHAPTER E.  DEBT OBLIGATIONS OF RIVER AUTHORITY
 778-2         Sec. 152.201.  AUTHORITY TO ISSUE OBLIGATIONS.  A river
 778-3   authority may issue revenue bonds, notes, or other obligations for
 778-4   a purpose authorized by:
 778-5               (1)  this chapter; or
 778-6               (2)  another law, if the purpose relates to the
 778-7   generation, transmission, or distribution of electricity.
 778-8   (V.A.C.S.  Art. 717p, Sec. 1 (part).)
 778-9         Sec. 152.202.  SALE OR EXCHANGE OF OBLIGATIONS.  Revenue
778-10   bonds, notes, or other obligations issued under this subchapter may
778-11   be:
778-12               (1)  sold for cash at a public or private sale;
778-13               (2)  issued on terms determined by the board of
778-14   directors of the river authority in exchange for property or an
778-15   interest in property the board of directors considers necessary or
778-16   convenient for a purpose described by Section 152.201;
778-17               (3)  issued in exchange for other matured or unmatured
778-18   obligations of the river authority in the same principal amounts;
778-19   or
778-20               (4)  sold for cash in the amount equal to the principal
778-21   amount of the obligations to:
778-22                     (A)  this state or an agency of this state;
778-23                     (B)  the United States; or
778-24                     (C)  an agency or corporation created or
778-25   designated by this state or the United States.  (V.A.C.S.
778-26   Art. 717p, Sec. 1 (part).)
778-27         Sec. 152.203.  INDEPENDENT APPRAISAL.  (a)  Before a river
 779-1   authority may acquire property under Section 152.202(2) through the
 779-2   exchange of revenue bonds, notes, or other obligations, the
 779-3   authority must obtain a written appraisal of the property by an
 779-4   independent appraiser certifying that the property has a value
 779-5   equal to or greater than the par value of the bonds, notes, or
 779-6   other obligations.
 779-7         (b)  The river authority shall:
 779-8               (1)  maintain the appraisal on file as a public record;
 779-9   and
779-10               (2)  file a copy of the appraisal with the state
779-11   auditor.  (V.A.C.S.  Art. 717p, Sec. 1 (part).)
779-12            (Sections 152.204-152.250 reserved for expansion
779-13                   SUBCHAPTER F.  HEDGING TRANSACTIONS
779-14         Sec. 152.251.  DEFINITION.  In this subchapter, "hedging"
779-15   means buying or selling crude oil, fuel oil, natural gas, or
779-16   electric energy futures or options, or similar contracts on those
779-17   commodity futures, as a protection against loss due to price
779-18   fluctuations.  (V.A.C.S. Art. 717p, Sec. 4B(e).)
779-19         Sec. 152.252.  AUTHORITY TO ENTER INTO HEDGING CONTRACT.
779-20   (a)  A river authority or a corporation created under Section
779-21   152.051 may enter into a hedging contract and related security and
779-22   insurance agreements.
779-23         (b)  A hedging transaction must comply with the regulations
779-24   of the Commodity Futures Trading Commission and the Securities and
779-25   Exchange Commission.  (V.A.C.S. Art. 717p, Sec. 4B(a) (part).)
779-26         Sec. 152.253.  PAYMENT CONSIDERED FUEL EXPENSE.  A payment by
779-27   a river authority or a corporation created under Section 152.051
 780-1   under a hedging contract or related agreement in relation to fuel
 780-2   supplies or fuel reserves is a fuel expense.  The authority or
 780-3   corporation may credit any amount it receives under the contract or
 780-4   agreement against fuel expenses.  (V.A.C.S. Art. 717p, Sec. 4B(b).)
 780-5         Sec. 152.254.  INVESTMENT OF MONEY IN HEDGING TRANSACTION.
 780-6   (a)  Except as provided by Subsection (b), the board of directors
 780-7   of a river authority may determine and designate the amount of
 780-8   money to be invested in a hedging transaction.
 780-9         (b)  The board of directors of the river authority by formal
780-10   policy shall regulate the investment of money in hedging contracts.
780-11   An investment may be made only for hedging purposes.  The policy
780-12   must provide restrictions and procedures for making an investment
780-13   that a person of ordinary prudence, discretion, and intelligence,
780-14   exercising the judgment and care under the circumstances then
780-15   prevailing, would follow in the management of the person's own
780-16   affairs, not in regard to speculation but in regard to the
780-17   permanent disposition of the person's money, considering:
780-18               (1)  the probable income; and
780-19               (2)  the probable safety of the person's capital.
780-20   (V.A.C.S.  Art. 717p, Secs. 4B(c), (d).)
780-21         Sec. 152.255.  RECOVERABILITY OF COSTS FROM RATEPAYERS.  This
780-22   subchapter does not limit the authority of the Public Utility
780-23   Commission of Texas to determine the recoverability of costs from
780-24   ratepayers.  (V.A.C.S. Art. 717p, Sec. 4B(f).)
780-25         SECTION 27.  CONFORMING AMENDMENT.  Article 1175, Revised
780-26   Statutes, is amended to read as follows:
780-27         Art. 1175.  ENUMERATED POWERS.  A home-rule municipality has
 781-1   the following powers:
 781-2               1.  [The power to issue bonds upon the credit of the
 781-3   city for the purpose of making permanent public improvements or for
 781-4   other public purposes in the amount and to the extent provided by
 781-5   such charter, and consistent with the Constitution of this State;
 781-6   provided, that said bonds shall have first been authorized by a
 781-7   majority vote by the duly qualified property tax-paying voters
 781-8   voting at an election held for that purpose.  Thereafter all such
 781-9   bonds shall be submitted to the Attorney General for his approval,
781-10   and the Comptroller for registration, as provided by law, provided
781-11   that any such bonds after approval, may be issued by the city,
781-12   either optional or serial or otherwise as may be deemed advisable
781-13   by the governing authority.  Whenever any city has heretofore been
781-14   authorized, under any special charter, creating such city, to issue
781-15   any bonds by the terms of such charter, the provisions of this
781-16   chapter shall not be construed to interfere with the issuance of
781-17   any such bonds under the provisions of any charter under which such
781-18   bonds were authorized.]
781-19               [2.]  To prohibit the use of any street, alley, highway
781-20   or grounds of the city by any telegraph, telephone, electric light,
781-21   street railway, interurban railway, steam railway, gas company, or
781-22   any other character of public utility without first obtaining the
781-23   consent of the governing authorities expressed by ordinance and
781-24   upon paying such compensation as may be prescribed and upon such
781-25   condition as may be provided by any such ordinance.  To determine,
781-26   fix and regulate the charges, fares or rates of any person, firm or
781-27   corporation enjoying or that may enjoy the franchise or exercising
 782-1   any other public privilege in said city and to prescribe the kind
 782-2   of service to be furnished by such person, firm or corporation, and
 782-3   the manner in which it shall be rendered, and from time to time
 782-4   alter or change such rules, regulations and compensation;  provided
 782-5   that in adopting such regulations and in fixing or changing such
 782-6   compensation, or determining the reasonableness thereof, no stock
 782-7   or bonds authorized or issued by any corporation enjoying the
 782-8   franchise shall be considered unless proof that the same have been
 782-9   actually issued by the corporation for money paid and used for the
782-10   development of the corporate property, labor done or property
782-11   actually received in accordance with the laws and Constitution of
782-12   this State applicable thereto.  In order to ascertain all facts
782-13   necessary for a proper understanding of what is or should be a
782-14   reasonable rate or regulation, the governing authority shall have
782-15   full power to inspect the books and compel the attendance of
782-16   witnesses for such purpose.
782-17               2. [3.]  Provided that in all cities of over
782-18   twenty-five thousand inhabitants, the governing body of such city,
782-19   when the public service of such city may require the same, shall
782-20   have the right and power to compel any street railway or other
782-21   public utility corporation to extend its lines of service into any
782-22   section of said city not to exceed two miles, all told, in any one
782-23   year.
782-24               3. [4.]  Whenever any city may determine to acquire any
782-25   public utility using and occupying its streets, alleys, and avenues
782-26   as hereinbefore provided, and it shall be necessary to condemn the
782-27   said public utility, the city may obtain funds for the purpose of
 783-1   acquiring the said public utility and paying the compensation
 783-2   therefor, by issuing bonds, notes or other evidence of indebtedness
 783-3   and shall secure the same by fixing a lien upon the said properties
 783-4   constituting the said public utility so acquired by condemnation or
 783-5   purchase or otherwise;  said security shall apply alone to said
 783-6   properties so pledged; and such further regulations may be provided
 783-7   by any charter for the proper financing or raising the revenue
 783-8   necessary for obtaining any public utilities and providing for the
 783-9   fixing of said security.
783-10         SECTION 28.  REPEALER.  (a)  The following Acts and articles
783-11   as compiled in Vernon's Texas Civil Statutes are repealed:  601d,
783-12   601d-1, 601d-3, 701, 702, 703, 703a, 703b, 704, 705, 705a, 706,
783-13   707, 708, 708a, 708b, 708b-1, 709, 709a, 709b, 709c, 709d, 710,
783-14   711, 712, 713, 714, 715, 715a, 715b, 715c, 716, 716a, 716b, 717,
783-15   717a, 717a-1, 717b, 717c, 717d, 717e, 717f, 717g, 717h, 717i,
783-16   717j-1, 717k, 717k-1, 717k-2, 717k-3, 717k-4, 717k-5, 717k-6,
783-17   717k-7, 717k-8, 717k-9, 717l, 717l-1, 717m-1, 717n, 717n-1, 717o,
783-18   717p, 717q, 717s, 717t, 717u, 717v, 717w, 718, 719, 720, 721, 722,
783-19   723, 724, 725, 725a, 725b, 725c, 725d, 726, 785, 786, 787, 788,
783-20   789, 790, 791, 792, 793, 794, 795, 795a, 796, 797, 798, 799, 800,
783-21   801, 802, 802a, 802b-1, 802b-2, 802b-3, 802b-4, 802b-5, 802c, 802d,
783-22   802e, 802f, 802g, 802h, 803, 804, 805, 806, 807, 808, 809, 810,
783-23   811, 812, 813, 814, 815, 816, 817, 818, 819, 820, 821, 822a, 822b,
783-24   822c, 822d, 822e, 822f, 823, 824, 825, 826, 827, 827a, 828, 829,
783-25   830, 831, 832, 833, 834, 835, 835c, 835e, 835e-1, 835e-2, 835f,
783-26   835g, 835h, 835i, 835j, 835k, 835k-1, 835l, 835m, 835n, 835o, 835p,
783-27   835q, 835r, 835s, 836, 837, 837a, 839, 840, 841, 969a-2, 1015c,
 784-1   1015c-2, 1015d, 1015g, 1015g-1, 1015g-2, 1015g-3, 1015g-4, 1015g-5,
 784-2   1015h, 1066g, 1105c, 1106, 1108a, 1108b, 1109a, 1109a-1, 1109a-2,
 784-3   1109h, 1110a, 1110d, 1110f, 1111, 1111a, 1111b, 1111c, 1111d, 1112,
 784-4   1113, 1113a, 1113b, 1114, 1114a, 1114b, 1114c, 1114d, 1115, 1115a,
 784-5   1115b, 1116, 1117, 1118, 1118a, 1118b, 1118c, 1118d, 1118e, 1118f,
 784-6   1118g, 1118h, 1118i, 1118j, 1118j-1, 1118j-2, 1118k, 1118l, 1118m,
 784-7   1118m-1, 1118m-2, 1118n, 1118n-1, 1118n-2, 1118n-3, 1118n-4,
 784-8   1118n-5, 1118n-6, 1118n-7, 1118n-8, 1118n-9, 1118n-10, 1118n-11,
 784-9   1118n-12, 1118o-1, 1118p, 1118q, 1118r, 1118s, 1118t, 1118u, 1118v,
784-10   1175e, 1176b-3, 1180b, 1182e, 1182h, 1182j, 1182n, 1187a, 1187a-1,
784-11   1187a-2, 1187b, 1187c, 1187d, 1187e, 1187f, 1264, 1269h-1, 1269h-2,
784-12   1269i, 1269j, 1269j-1, 1269j-4, 1269j-4.1, 1269j-4.15, 1269j-4.3,
784-13   1269j-4.4, 1269j-4.7, 1269j-4.8, 1269j-4.9, 1269j-5, 1269j-5.1,
784-14   1269j-5.2, 1269j-5.3, 1269j-5.4, 1269j-6, 1269j-7, 1269j-8,
784-15   1269j-9, 1269j-11, 1644c, 1644c-1, 1676c, 1696a, 1696b, 2351a-4,
784-16   2351a-7, 2352e, 2368a, 2368a-13, 2368a-14, 2368b, 2368b-1, 2368c,
784-17   2368d, 2368f, 2370, 2370b, 2370c, 2370c-1, 2370d, 2372d-1, 2372d-2,
784-18   2372d-4, 2372d-8, 2372q, 2372s, 2606a, 4398, 4477-7b, 5190.1,
784-19   5190.9a, 6081h, 6081i, 6081j, 6830, 6831, 6832, 6833, 6834, 6835,
784-20   6836, 6837, 6838, 6839, 6839b, 6839c, 6839d, 6839e, and 6839g.
784-21         (b)  The following are repealed:
784-22               (1)  Section 2256.056, Government Code;
784-23               (2)  Section 5, Chapter 423, Acts of the 73rd
784-24   Legislature, Regular Session, 1993;
784-25               (3)  Section 3, Chapter 1058, Acts of the 74th
784-26   Legislature, Regular Session, 1995.
784-27         SECTION 29.  LEGISLATIVE INTENT OF NO SUBSTANTIVE CHANGE.
 785-1   (a)  This Act is enacted under Section 43, Article III, Texas
 785-2   Constitution.  This Act is intended as a recodification only, and
 785-3   no substantive change in the law is intended by this Act.
 785-4         (b)  This Act does not impair any obligation created by the
 785-5   issuance of bonds, notes, or other obligations in accordance with
 785-6   prior law, and all bonds, notes, or other obligations validly
 785-7   issued under provisions revised or repealed remain valid,
 785-8   enforceable, and binding according to their terms and shall be paid
 785-9   from the sources pledged to their payment.  Bonds, notes, or other
785-10   obligations authorized but unissued on the effective date of this
785-11   Act may be issued in compliance with and subject to the provisions
785-12   of the prior law.
785-13         SECTION 30.  EFFECTIVE DATE.  This Act takes effect September
785-14   1, 1999.
785-15         SECTION 31.  EMERGENCY.  The importance of this legislation
785-16   and the crowded condition of the calendars in both houses create an
785-17   emergency and an imperative public necessity that the
785-18   constitutional rule requiring bills to be read on three several
785-19   days in each house be suspended, and this rule is hereby suspended.