1-1     By:  Duncan                                           S.B. No. 1089
 1-2           (In the Senate - Filed March 9, 1999; March 11, 1999, read
 1-3     first time and referred to Committee on Education; April 23, 1999,
 1-4     reported favorably by the following vote:  Yeas 6, Nays 0;
 1-5     April 23, 1999, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the investment of debt service funds by school
 1-9     districts, junior college districts, and community college
1-10     districts.
1-11           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12           SECTION 1.  Subchapter E, Chapter 45, Education Code, is
1-13     amended by adding Section 45.112 to read as follows:
1-14           Sec. 45.112.  CONTRACTS FOR INVESTMENT OF DEBT SERVICE FUNDS.
1-15     (a)  A school district, including a junior college district or
1-16     community college district, may enter into a contract with a term
1-17     not to exceed seven years to purchase investments with the proceeds
1-18     of taxes levied or to be levied by the district for the purpose of
1-19     paying debt service on bonds issued by the district.
1-20           (b)  A contract under this section may provide for the
1-21     purchase of investments at a stated yield or yields.
1-22           (c)  Before entering a contract under this section, a school
1-23     district must solicit and receive bids from at least three separate
1-24     providers.  The district must accept the qualifying bid that
1-25     provides for the highest yield investments over the term of the
1-26     contract.
1-27           (d)  A contract under this section may provide only for the
1-28     purchase of an obligation described by Section 2256.009(a)(1),
1-29     Government Code, other than an obligation described by Section
1-30     2256.009(b) of that code.
1-31           SECTION 2.  The importance of this legislation and the
1-32     crowded condition of the calendars in both houses create an
1-33     emergency and an imperative public necessity that the
1-34     constitutional rule requiring bills to be read on three several
1-35     days in each house be suspended, and this rule is hereby suspended,
1-36     and that this Act take effect and be in force from and after its
1-37     passage, and it is so enacted.
1-38                                  * * * * *