1-1 By: Duncan S.B. No. 1091
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 issuance and sale of bonds and time warrants by
1-9 school districts and the issuance of obligations and execution of
1-10 credit agreements by certain school districts and junior college
1-11 districts.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 45.001, Education Code, is amended to
1-14 read as follows:
1-15 Sec. 45.001. BONDS AND BOND TAXES. (a) The governing board
1-16 of an independent school district, including the city council or
1-17 commission that has jurisdiction over a municipally controlled
1-18 independent school district, the governing board of a rural high
1-19 school district, and the commissioners court of a county, on behalf
1-20 of each common school district under its jurisdiction, may:
1-21 (1) issue negotiable coupon bonds for:
1-22 (A) the construction, acquisition, and equipment
1-23 of school buildings in the district;
1-24 (B) the acquisition of property or the
1-25 refinancing of property financed under a contract entered under
1-26 Subchapter A, Chapter 271, Local Government Code, regardless of
1-27 whether payment obligations under the contract are due in the
1-28 current year or a future year; and
1-29 (C) the purchase of the necessary sites for
1-30 school buildings;[,] and
1-31 (2) may levy, pledge, assess, and collect annual ad
1-32 valorem taxes sufficient to pay the principal of and interest on
1-33 the bonds as the principal and interest become due, subject to
1-34 Section 45.003.
1-35 (b) The bonds must mature serially or otherwise not more
1-36 than 40 years from their date. The bonds may be made redeemable
1-37 before maturity.
1-38 (c) Bonds may be sold at public or private sale as
1-39 determined by the governing board of the district [All bonds must
1-40 be sold to the highest bidder for not less than their par value and
1-41 accrued interest].
1-42 SECTION 2. Subchapter A, Chapter 45, Education Code, is
1-43 amended by adding Section 45.0011 to read as follows:
1-44 Sec. 45.0011. CREDIT AGREEMENTS IN CERTAIN SCHOOL DISTRICTS.
1-45 (a) This section applies only to an independent school district
1-46 that, at the time of the issuance of obligations and execution of
1-47 credit agreements under this section, has:
1-48 (1) at least 2,000 students in average daily
1-49 attendance, as determined under Section 42.005; or
1-50 (2) a combined aggregate principal amount of at least
1-51 $50 million of outstanding bonds and voted but unissued bonds.
1-52 (b) A district to which this section applies may, in the
1-53 issuance of bonds as provided by Sections 45.001 and 45.003(b)(1),
1-54 exercise the powers granted to the governing body of an issuer with
1-55 regard to the issuance of obligations and execution of credit
1-56 agreements under Chapter 656, Acts of the 68th Legislature, Regular
1-57 Session, 1983 (Article 717q, Vernon's Texas Civil Statutes).
1-58 (c) A proposition to issue bonds to which this section
1-59 applies must, in addition to meeting the requirements of Section
1-60 45.003(b)(1), include the question of whether the governing board
1-61 or commissioners court may levy, pledge, assess, and collect annual
1-62 ad valorem taxes, on all taxable property in the district,
1-63 sufficient, without limit as to rate or amount, to pay the
1-64 principal of and interest on the bonds and the costs of any credit
2-1 agreements executed in connection with the bonds.
2-2 (d) Section 6, Chapter 656, Acts of the 68th Legislature,
2-3 Regular Session, 1983 (Article 717q, Vernon's Texas Civil
2-4 Statutes), governs approval by the attorney general of obligations
2-5 issued under the authority of this section.
2-6 SECTION 3. Subsections (a) and (b), Section 45.103,
2-7 Education Code, are amended to read as follows:
2-8 (a) Any school district in need of funds to construct,
2-9 repair, or renovate school buildings, purchase school buildings and
2-10 school equipment, or equip school properties with necessary
2-11 heating, water, sanitation, lunchroom, or electric facilities or in
2-12 need of funds with which to employ a person who has special skill
2-13 and experience to compile taxation data and that is financially
2-14 unable out of available funds to construct, repair, renovate, or
2-15 [make the repairs or renovations of school buildings,] purchase
2-16 school buildings, purchase school equipment, or equip school
2-17 properties with necessary heating, water, sanitation, lunchroom, or
2-18 electric facilities or is unable to pay the person for compiling
2-19 taxation data, may, subject to this section, issue interest-bearing
2-20 time warrants, in amounts sufficient to construct, [make the]
2-21 purchase, equip, or improve school buildings and facilities
2-22 [improvements] or to pay all or part of the compensation of the
2-23 person to compile taxation data, any law to the contrary
2-24 notwithstanding. The warrants shall mature in serial installments
2-25 of not more than five years from their date of issue. The warrants
2-26 on maturity may be payable out of any available funds of the school
2-27 district in the order of their maturity dates. Any
2-28 interest-bearing time warrants may be issued and sold by the
2-29 district for not less than their face value, and the proceeds used
2-30 to provide funds required for the purpose for which they are
2-31 issued. The warrants shall be entitled to first payment out of any
2-32 available funds of the district as they become due. Included in
2-33 the purposes for which interest-bearing time warrants may be issued
2-34 is the payment of any amounts owed by the school district that was
2-35 incurred in carrying out any of those purposes.
2-36 (b) Interest-bearing time warrants may not be issued or sold
2-37 by a common school district or rural high school district until
2-38 they are approved by the county board of school trustees. The
2-39 board shall, on application of the school district, inquire into
2-40 the financial conditions and needs of the district, and may not
2-41 approve the issuance of interest-bearing time warrants unless in
2-42 its opinion the district:
2-43 (1) is in need of constructing, purchasing, repairing,
2-44 or renovating a school building, obtaining the school equipment, or
2-45 equipping school properties with necessary heating, water,
2-46 sanitation, lunchroom, or electric facilities; and
2-47 (2) will be able with the resources in prospect to
2-48 liquidate the warrants at their maturity.
2-49 SECTION 4. Subchapter G, Chapter 130, Education Code, is
2-50 amended by adding Section 130.1221 to read as follows:
2-51 Sec. 130.1221. CREDIT AGREEMENTS IN CERTAIN JUNIOR COLLEGE
2-52 DISTRICTS. (a) This section applies only to a junior college
2-53 district that, at the time of the issuance of obligations and
2-54 execution of credit agreements under this section, has:
2-55 (1) at least 2,000 full-time students or the
2-56 equivalent; or
2-57 (2) a combined aggregate principal amount of at least
2-58 $50 million of outstanding bonds and voted but unissued bonds.
2-59 (b) A district to which this section applies may, in the
2-60 issuance of bonds as provided by Section 130.122, exercise the
2-61 powers granted to the governing body of an issuer with regard to
2-62 the issuance of obligations and execution of credit agreements
2-63 under Chapter 656, Acts of the 68th Legislature, Regular Session,
2-64 1983 (Article 717q, Vernon's Texas Civil Statutes).
2-65 (c) A proposition to issue bonds to which this section
2-66 applies must include the question of whether the governing board
2-67 may levy, pledge, assess, and collect annual ad valorem taxes
2-68 sufficient to pay the principal of and interest on the bonds and
2-69 the costs of any credit agreements executed in connection with the
3-1 bonds.
3-2 (d) Section 6, Chapter 656, Acts of the 68th Legislature,
3-3 Regular Session, 1983 (Article 717q, Vernon's Texas Civil
3-4 Statutes), governs approval by the attorney general of obligations
3-5 issued under the authority of this section.
3-6 SECTION 5. The importance of this legislation and the
3-7 crowded condition of the calendars in both houses create an
3-8 emergency and an imperative public necessity that the
3-9 constitutional rule requiring bills to be read on three several
3-10 days in each house be suspended, and this rule is hereby suspended,
3-11 and that this Act take effect and be in force from and after its
3-12 passage, and it is so enacted.
3-13 * * * * *