By Dunnam                                             H.B. No. 3310
         77R5589 KKA-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to payment sources for a school district's local share of
 1-3     debt service for which the district receives state assistance.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 46.003, Education Code, is amended by
 1-6     amending Subsections (d)-(g) and adding Subsection (h) to read as
 1-7     follows:
 1-8           (d)  A district may pay the district's share of the debt
 1-9     service using:
1-10                 (1)  bond taxes collected for the current year;
1-11                 (2)  bond taxes collected in a preceding tax year in
1-12     excess of the amount necessary to pay the bonds for which the taxes
1-13     were collected;
1-14                 (3)  maintenance and operations taxes collected in
1-15     excess of the district's enrichment tax rate, as defined by Section
1-16     42.302; or
1-17                 (4)  any other local money, including donations and
1-18     grants, not obtained from a governmental source or used to generate
1-19     state financial support for the district.
1-20           (e)  Bonds are eligible to be paid with state and local funds
1-21     under this section if:
1-22                 (1)  taxes to pay the principal of and interest on the
1-23     bonds were first levied in the 1997-1998 school year or a later
1-24     school year; and
 2-1                 (2)  the bonds do not have a weighted average maturity
 2-2     of less than eight years.
 2-3           (f) [(e)]  A district may use state funds received under this
 2-4     section only to pay the principal of and interest on the bonds for
 2-5     which the district received the funds.
 2-6           (g) [(f)]  The board of trustees and voters of a school
 2-7     district shall determine district needs concerning construction,
 2-8     acquisition, renovation, or improvement of instructional
 2-9     facilities.
2-10           (h) [(g)]  To receive state assistance under this subchapter,
2-11     a school district must apply to the commissioner in accordance with
2-12     rules adopted by the commissioner before issuing bonds that will be
2-13     paid with state assistance.  Until the bonds are fully paid or the
2-14     instructional facility is sold:
2-15                 (1)  a school district is entitled to continue
2-16     receiving state assistance without reapplying to the commissioner;
2-17     and
2-18                 (2)  the guaranteed level of state and local funds per
2-19     student per cent of tax effort applicable to the bonds may not be
2-20     reduced below the level provided for the year in which the bonds
2-21     were issued.
2-22           SECTION 2.  Section 46.032, Education Code, is amended by
2-23     adding Subsection (c) to read as follows:
2-24           (c)  A district may pay the district's share of existing debt
2-25     using:
2-26                 (1)  bond taxes collected for the current year;
2-27                 (2)  bond taxes collected in a preceding tax year in
 3-1     excess of the amount necessary to pay the bonds for which the taxes
 3-2     were collected;
 3-3                 (3)  maintenance and operations taxes collected in
 3-4     excess of the district's enrichment tax rate, as defined by Section
 3-5     42.302; or
 3-6                 (4)  any other local money, including donations and
 3-7     grants, not obtained from a governmental source or used to generate
 3-8     state financial support for the district.
 3-9           SECTION 3.  This Act takes effect September 1, 2001.