78R4771 JJT-F
By: Capelo H.B. No. 1934
A BILL TO BE ENTITLED
AN ACT
relating to security and payment for, and the use of the proceeds
of, certain public securities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 1201.042, Government Code, is amended by
amending Subsection (a) and adding Subsections (d) and (e) to read
as follows:
(a) An [If an issuer is authorized by law to secure and pay
any portion of a public security with revenue derived from the
ownership or operation of a project or facility, the] issuer may use
the proceeds of a [the] public security issued to finance the
acquisition, construction, or improvement of a project or facility
to:
(1) pay interest on the public security while the
project or facility is being acquired, [or] constructed, or
improved and for the year after it is acquired, [or] constructed, or
improved;
(2) operate and maintain the project or facility
during the estimated period of acquisition, [or] construction, or
improvement of the project or facility and for one year after it is
acquired, [or] constructed, or improved;
(3) finance other funds relating to the public
security, including debt service reserve and contingency; and
(4) pay the cost or expense of the issuance of the
public security.
(d) An issuer may spend a premium received by the issuer as
part of the purchase price of public securities sold at a public or
private sale:
(1) to provide for payment of debt service on the
public securities sold;
(2) to contribute to an escrow established to provide
for payment of debt service on obligations being refunded through
the sale of the public securities;
(3) to pay the cost or expense of issuing the public
securities; or
(4) to pay any other cost related to the purpose for
which the public securities were issued, as specified in the public
security authorization.
(e) Subsection (d)(4) does not authorize an issuer to spend
money in an amount that exceeds limitations provided by other law or
by the public security authorization.
SECTION 2. Section 1431.007(a), Government Code, is amended
to read as follows:
(a) Except as provided by Subsection (b), a governing body
may:
(1) provide that anticipation notes be paid from and
secured by revenue, taxes, a combination of revenue and taxes, or
the proceeds of bonds to be issued by the issuer; and
(2) pledge to the payment of anticipation notes
revenue, taxes, a combination of revenue and taxes, or the proceeds
of bonds to be issued by the issuer.
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2003.