By Capelo H.B. No. 3224
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the substantive changes in connection with the
1-3 codification of various statutes into the public securities title
1-4 of the Government Code.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subchapter A, Chapter 1207, Government Code, is
1-7 hereby amended by adding a new Section 1207.007, and renumbering
1-8 Section 1207.007 as Section 1207.008, to read as follows:
1-9 *Sec. 1207.007. DELEGATION OF AUTHORITY. (a) In connection
1-10 with the issuance of refunding bonds, an issuer may authorize:
1-11 (1) the maximum principal amount of refunding bonds
1-12 that shall be issued; and
1-13 (2) any officer or employee of the issuer to:
1-14 (A) select any specific maturities or series of
1-15 bonds, notes, or other general or special obligations to be
1-16 refunded; and
1-17 (B) effect the sale of the refunding bonds.
1-18 (b) In exercising the authority delegated by the issuer, any
1-19 officer or employee may establish the terms, conditions, and
1-20 details related to the issuance and sale of the refunding bonds,
1-21 including without limitation:
2-1 (1) the form and designation of the refunding bonds:
2-2 (2) the principal amount of the refunding bonds:
2-3 (3) the dates, price, interest rates, interest payment
2-4 dates, principal payment dates and redemption features of the
2-5 refunding bonds;
2-6 (4) the form of escrow agreement described in Section
2-7 1207.062; and
2-8 (5) such other details relating to the issuance and
2-9 sale of the refunding bonds as specified by the issuer in the
2-10 resolution, order, or ordinance authorizing the issuance of the
2-11 refunding bonds.
2-12 (c) Refunding bonds may not be issued if the aggregate
2-13 amount of payments to be made under the refunding bonds exceeds the
2-14 aggregate principal amount of payments that would have been made
2-15 under the terms of the obligations being refunded, unless the
2-16 governing body of the issuer finds in the resolution, order or
2-17 ordinance authorizing the issuance of the refunding bonds that
2-18 (1) the issuance is in the best interests of the
2-19 issuer; and
2-20 (2) a maximum level of loss is specified therein.
2-21 (d) Any finding or determination made by the governing body
2-22 of an issuer in the resolution, order or ordinance authorizing the
2-23 issuance of refunding bonds shall be binding and conclusive, and
2-24 any person shall be entitled to rely upon a certification from the
2-25 issuer to the effect, including, without limitation, the attorney
3-1 general in the performance of the duties of the attorney general
3-2 specified in Chapter 1202.
3-3 SECTION 2. Section 1207.062(b), Government Code, is hereby
3-4 amended to read as follows:
3-5 "(b) An escrow agreement under Subsection (a) must provide
3-6 that the deposit may be invested only in
3-7 (1) direct noncallable obligations of the United
3-8 States, including obligations the principal of and interest on
3-9 which are unconditionally guaranteed by the United States:
3-10 (2) noncallable obligations of an agency or
3-11 instrumentality of the United States, including obligations the
3-12 principal of and interest of which are unconditionally guaranteed
3-13 or insured by the agency or instrumentality of the United States
3-14 and which are rated as to investment quality by a nationally
3-15 recognized investment rating firm not less than AA or its
3-16 equivalent; and
3-17 (3) noncallable obligations of states, agencies,
3-18 counties, cities, and other political subdivisions of any state
3-19 which have been refunded and which are rated as to investment
3-20 quality by a nationally recognized investment rating firm not less
3-21 than AAA or its equivalent. and which mature and bear interest
3-22 payable at times and in amounts sufficient to provide for the
3-23 scheduled payment of redemption of the obligation to be refunded.
3-24 The obligations may be in book-entry form."
3-25 SECTION 3. Section 1231.044(b), Government Code, is hereby
4-1 amended to read as follows:
4-2 Sec. 1231.044. STATE AUDITOR REVIEW OF STATE SECURITY
4-3 PROCEEDS; REPORT.
4-4 "(b) The state auditor shall prepare a report of the review
4-5 and file a copy of the report with the board and with:
4-6 (1) the governor;
4-7 (2) the lieutenant governor;
4-8 (3) the speaker of the house of representatives;
4-9 (4) the secretary of state; and
4-10 (5) member of the legislature."
4-11 SECTION 4. Section 1331.001, Government Code, is hereby
4-12 amended to read as follows:
4-13 "Sec. 1331.001. AUTHORITY OF MUNICIPALITY TO ISSUE BONDS. A
4-14 municipality may issue bonds [with one or more interest coupons] in
4-15 the amount it considers expedient to:
4-16 (1) construct or purchase permanent improvements
4-17 inside the municipal boundaries, including public buildings,
4-18 waterworks, or sewers;
4-19 (2) construct or improve the streets and bridges of
4-20 the municipality; or
4-21 (3) construct or purchase building sites or buildings
4-22 for the public schools and other institutions of learning inside
4-23 the municipality, if the municipality has assumed exclusive control
4-24 of those schools and institutions."
4-25 SECTION 5. Section 1332.002, Government Code, is hereby
5-1 amended to read as follows:
5-2 "Sec. 1331.002. SIGNATURES [OF MAYOR AND MUNICIPAL
5-3 SECRETARY]. A bond issued by a municipality under Section 1331.001
5-4 [must] shall be signed [by the mayor and countersigned by the
5-5 municipal secretary] in the manner provided in the ordinance, order
5-6 or resolution authorizing the issuance of the bonds."
5-7 SECTION 6. Subsection (4) and (5) of Section 1371.001,
5-8 Government Code, are hereby amended to read as follows:
5-9 "(4) "Issuer" means:
5-10 (A) a home-rule municipality that:
5-11 (i) adopted its charter under Section 5,
5-12 Article XI, Texas Constitution;
5-13 (ii) has a population of [90,000] 50,000
5-14 or more; and
5-15 (iii) has outstanding long-term
5-16 indebtedness [secured by the revenue of the public works for which
5-17 an obligation is being issued] that is rated by a nationally
5-18 recognized rating agency for municipal securities in on of the four
5-19 highest rating categories for a long-term obligation;
5-20 (5) "Obligation" means a [note, warrant, or other
5-21 special obligation authorized to be issued by an issuer under this
5-22 chapter or a] public security as defined by Section 1201.002 or
5-23 other special obligation authorized to be issued by an issuer that,
5-24 before delivery, is rated by a nationally recognized rating agency
5-25 for municipal securities in one of the three highest rating
6-1 categories for a short-term debt instrument or one of the four
6-2 highest rating categories for a long-term debt instrument."
6-3 SECTION 7. Section 1321.003, Government Code, is hereby
6-4 amended by adding new subsection (d), to read as follows:
6-5 "(d) Any finding or determination made by the governing body
6-6 of an issuer under authority of this chapter shall be binding and
6-7 conclusive, and any person shall be entitled to rely upon a
6-8 certification from the issuer to that effect, including, without
6-9 limitation, the attorney general in the performance of the duties
6-10 of the attorney general specified in Chapter 1202."
6-11 SECTION 8. Section 1371.053, Government Code, is hereby
6-12 amended to read as follows:
6-13 "(a) An obligation authorization must be approved by a
6-14 governing body before an obligation may be issued. [The issuance
6-15 of an obligation must be authorized by an obligation
6-16 authorization.]
6-17 SECTION 9. Subsection (b) of Section 1371.056, Government
6-18 Code, is hereby amended to read as follows:
6-19 "(b) In connection with the issuance of an obligation, or in
6-20 conjunction with the payment, sale, resale, or exchange of the
6-21 obligation, a governing body may enter into a credit agreement:
6-22 (1) to enhance the security of an obligation:
6-23 (2) to provide for the payment, redemption, or
6-24 remarketing of an obligation and interest on the obligation in
6-25 order to reduce the interest payable on the obligation; or
7-1 (3) in conjunction with the interim financing of an
7-2 eligible project.
7-3 [To enhance the security for or provide for the payment,
7-4 redemption, or remarketing of an obligation and interest on the
7-5 obligation in order to reduce the interest payable on the
7-6 obligation or in conjunction with the interim financing of an
7-7 eligible project of an issuer, a governing body may enter into a
7-8 credit agreement:]
7-9 [(1) at or after the issuance of the obligation, or]
7-10 [(2) in conjunction with the payment, sale, resale, or
7-11 exchange of the obligation.]
7-12 SECTION 10. Section 1371.056, Government Code, is hereby
7-13 amended by adding a new subsection (g), to read as follows:
7-14 "(g) The governing body of an issuer may delegate to any
7-15 officer or employees the authority to enter into transactions under
7-16 a credit agreement authorized by the governing body and to execute
7-17 any instruments in connection with the transactions."
7-18 SECTION 11. Section 1371.057, Government Code, is hereby
7-19 amended by adding a new subsection (d), to read as follows:
7-20 "The comptroller shall register the record of the proceedings
7-21 relating to the issuance of obligations or the execution of a
7-22 credit agreement."
7-23 SECTION 12. Subsection (b) of Section 1371.103, Government
7-24 Code, is hereby amended to read as follows:
7-25 (b) A governing body may secure an obligation and pay the
8-1 cost of a credit agreement executed and delivered in connection
8-2 with the financing of a project cost for an eligible project
8-3 described in Section 1371.001(2)(D) with ad valorem taxes or with
8-4 other sources permitted by this chapter."
8-5 SECTION 13. Subsections (2) and (3) of Section 1431.001,
8-6 Government Code, are hereby amended to read as follows:
8-7 "(2) "Governing body" means the commissioners court of
8-8 a county or the governing body of a municipality, junior college
8-9 district, independent school district or county issuing an
8-10 anticipation note."
8-11 SECTION 14. Section 1431.002, Government Code, is hereby
8-12 amended by adding new subsections (c) and (d), to read as follows:
8-13 "(c) The governing body of a junior college district by
8-14 order or resolution may authorize the issuance of anticipation
8-15 notes.
8-16 (d) The governing body of an independent school district by
8-17 order may authorize the issuance of an anticipation note."
8-18 SECTION 15. Section 1431.003, Government Code, is hereby
8-19 amended to read as follows:
8-20 "Sec. 1431.003. ADDITIONAL AUTHORITY OF COUNTIES, JUNIOR
8-21 COLLEGE DISTRICTS, AND CERTAIN MUNICIPALITIES AND INDEPENDENT
8-22 SCHOOL DISTRICTS. (a) This section applies only to an issuer that
8-23 is:
8-24 (1) a county; [or]
8-25 (2) a junior college district;
9-1 (3) an independent school district that at any time on
9-2 or after September 1, 1999, has
9-3 (A) outstanding bonds in the aggregate principal
9-4 amount of at least $50 million; or
9-5 (B) a student population in excess of 2,000
9-6 students; and
9-7 (4) a municipality with a population of [80,000]
9-8 50,000 or more."
9-9 SECTION 16. Subsection (1) of Section 1431.006, Government
9-10 Code, is hereby amended to read as follows:
9-11 Sec. 1431.006. LIMITATION ON NOTES TO PAY EXPENSES.
9-12 Anticipation notes issued under Section 1431.004(a)(2) may not, in
9-13 the fiscal year in which the attorney general approves the notes:
9-14 (1) [a municipality] an issuer other than a county,
9-15 exceed 75 percent of the revenue or taxes anticipated to be
9-16 collected in that year; or"
9-17 SECTION 17. Section 1504.001, Government Code, and
9-18 subsections (3) and (4) thereof, are hereby amended to read as
9-19 follows:
9-20 "Sec. 1504.001. AUTHORITY FOR CULTURAL OR ATHLETIC
9-21 FACILITIES. A municipality may establish, acquire lease as lessee
9-22 or lessor, construct, improve, enlarge, equip, repair, operate, or
9-23 maintain a cultural ore athletic facility, including:
9-24 (3) a hotel owned by a municipality or a non profit
9-25 municipally owned local government corporation created under
10-1 Chapter 431, Transportation Code, that is located not more than
10-2 1,000 feet from a convention center owned by a municipality with a
10-3 population of 450,000 [1,500,000] or more;
10-4 (4) a historic hotel owned by a municipality or a
10-5 nonprofit municipality owned local government corporation created
10-6 under Chapter 431, Transportation Code, that is located not more
10-7 than one mile from a convention center owned by a municipality with
10-8 a population of 450,000 [1,500,000] or more; or"
10-9 SECTION 18. Section 1504.003, Government Code, is hereby
10-10 amended by adding a new subsection (d) to read as follows:
10-11 "(d) A municipality may pledge to the payment of bonds
10-12 issued under this subchapter, alone or in combination with the
10-13 revenue from the facility for which bonds are issued, hotel
10-14 occupancy taxes that are pledged under and in accordance with the
10-15 provisions of Section 351.102, Tax Code."
10-16 SECTION 19. Section 1504.008, Government Code, is hereby
10-17 amended to read as follows:
10-18 "Sec. 1504.008. SIGNATURES. A bond issued under this
10-19 subchapter may [must] be signed in the manner provided in the
10-20 ordinance [by the mayor of the municipality and countersigned by
10-21 the secretary or clerk of the municipality]."
10-22 SECTION 20. Section 1504.010, Government Code, and
10-23 subsection (1) thereof, are hereby amended to read as follows:
10-24 "Sec. 1504.010. TERM OF CERTAIN LEASES. In a municipality
10-25 with a population of 450,000 [1.5 million] or more, a lease entered
11-1 into under Section 1504.001 may have a term of not to exceed 60
11-2 years if:
11-3 (1) the lessee proposes to invest more than $10 [20]
11-4 million to renovate . . . ;"
11-5 SECTION 21. Subsection (b) of Section 1504.105, Government
11-6 Code, is hereby amended to read as follows:
11-7 (f) Each contract, bond, note, or other evidence of
11-8 indebtedness issued or included under this subchapter must contain
11-9 substantially the following provision: "The holder of this
11-10 obligation is not entitled to demand payment of this obligation out
11-11 of any money raised by taxation."
11-12 SECTION 22. Subsection (b) of Section 1504.154, Government
11-13 Code, is hereby amended to read as follows:
11-14 "(b) The face of each bond issued under this subchapter must
11-15 contain substantially the following provision: "The holder of this
11-16 obligation is not entitled to demand payment of this obligation out
11-17 of any money raised by taxation."
11-18 SECTION 23. Section 1504.157, Government Code, is hereby
11-19 amended to read as follows:
11-20 "Sec. 1504.157. SIGNATURES. A bond issued under this
11-21 subchapter may [must] be signed in the manner provided in the
11-22 ordinance [by the mayor of the municipality and countersigned by
11-23 the secretary of the municipality]."
11-24 SECTION 24. Subsection (b) of Section 1504.154, Government
11-25 Code, is hereby amended to read as follows:
12-1 "(b) Each contract, bond, or note issued or executed under
12-2 this subchapter must contain substantially the following provision:
12-3 "The holder of this obligation is not entitled to demand payment of
12-4 this obligation out of any money raised by taxation."
12-5 SECTION 25. Section 1504.251, Government Code, is hereby
12-6 amended to read as follows:
12-7 "Sec. 1504.251. APPLICABILITY OF SUBCHAPTER. This
12-8 subchapter applies only to a home-rule municipality with a
12-9 population of 450,000 [1.2 million] or more."
12-10 SECTION 26. Section 1504.243, Government Code, is hereby
12-11 amended to read as follows:
12-12 Sec. 1504.253. AUTHORITY TO ISSUE REVENUE BONDS. The
12-13 governing body of a municipality by ordinance may issue revenue
12-14 bonds to provide all or part of the money to effect any purpose
12-15 [establish, acquire, construct, improve, equip, repair, operate, or
12-16 maintain a cultural or parking facility] described by Section
12-17 1504.252.
12-18 SECTION 27. Section 1504.261, Government Code, is hereby
12-19 amended to read as follows:
12-20 "Sec. 1504.261. SIGNATURES. A bond issued under this
12-21 subchapter may [must] be signed in the manner provided in the
12-22 ordinance [by the mayor of the municipality and countersigned by
12-23 the secretary or clerk of the municipality]."
12-24 SECTION 28. The following provisions are hereby repealed:
12-25 (a) Chapter 1253;
13-1 (b) Subchapter C, Chapter 1331;
13-2 (c) Subchapter B, Chapter 1504;
13-3 (d) Subchapter D, Chapter 1504;
13-4 (e) Subchapter B, Chapter 1509;
13-5 (f) Subchapter F, Chapter 1509.
13-6 SECTION 29. The importance of this legislation and the
13-7 crowded condition of the calendars in both houses create an
13-8 emergency and an imperative public necessity that the
13-9 constitutional rule requiring bills to be read on three several
13-10 days in each house be suspended, and this rule is hereby suspended,
13-11 and that this Act take effect and be in force from and after its
13-12 passage, and it is so enacted.