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A BILL TO BE ENTITLED
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AN ACT
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relating to the issuance of bonds or other obligations by library |
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districts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 326, Local Government Code, is amended |
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by adding Subchapter F to read as follows: |
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SUBCHAPTER F. MONEY FOR LIBRARY SYSTEM; BONDS |
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Sec. 326.151. DEFINITIONS. In this subchapter: |
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(1) "Bond" has the meaning assigned to "public |
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security" by Section 1201.002, Government Code. |
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(2) "Credit agreement" has the meaning assigned by |
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Section 1371.001, Government Code. |
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Sec. 326.152. MONEY FOR LIBRARY SYSTEM. (a) The board may |
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provide money to acquire, purchase, construct, improve, renovate, |
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enlarge, or equip property, buildings, structures, or related |
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infrastructure for a public library. |
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(b) In connection with exercising the authority to provide |
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money for a purpose described by Subsection (a), the board may |
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provide money to acquire, purchase, or otherwise obtain any |
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interest in property. |
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Sec. 326.153. AUTHORITY TO ISSUE BONDS. The board may issue |
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bonds and incur obligations under contracts in accordance with this |
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chapter for a purpose described by Section 326.152. |
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Sec. 326.154. PLEDGE OF REVENUE AND SALES TAXES. (a) The |
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board may pledge to the payment of any bonds issued or any |
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obligations incurred under Section 326.153 all or any part of the |
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revenue of the district's library system or the district's sales and |
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use tax. |
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(b) The board may grant a lien on the pledged revenue. The |
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lien has the priority determined by the board. |
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Sec. 326.155. GRANT OF MORTGAGE OR FRANCHISE. As |
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additional security for district bonds or other obligations, the |
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district by the terms of the encumbrance may grant a purchaser under |
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sale or foreclosure a mortgage or a franchise to operate the |
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encumbered library system for a term not to exceed 20 years from the |
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date of purchase, subject to all laws regulating the operation of |
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the library system in force at the time of the sale or foreclosure. |
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Sec. 326.156. USE AND INVESTMENT OF PROCEEDS. (a) To the |
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extent provided by the proceedings authorizing the issuance of |
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district bonds, a district may use proceeds from the sale of |
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district bonds to provide money for a library system under this |
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chapter for a purpose authorized by Section 326.152. |
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(b) A district may use proceeds from the sale of district |
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bonds to pay interest on the bonds during the period of the |
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acquisition or construction of any property to be provided through |
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the issuance of the bonds, and for one year after completion of the |
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acquisition or construction of the property. |
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(c) A district may use proceeds from the sale of district |
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bonds to: |
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(1) provide a reserve for the payment of debt service |
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on the bonds; |
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(2) provide a reserve for extraordinary repairs and |
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replacements; or |
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(3) obtain a credit agreement as provided by Section |
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326.159. |
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(d) A district may invest proceeds from the sale of district |
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bonds to the extent and in the manner provided in the proceedings |
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authorizing the issuance of the bonds. |
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Sec. 326.157. MATURITY. District bonds must mature not |
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later than 30 years after their date of issuance. |
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Sec. 326.158. ADDITIONAL OBLIGATIONS TO IMPROVE OR EXTEND |
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LIBRARY SYSTEM. (a) A district that has outstanding bonds secured |
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by library system revenue may issue additional bonds or incur other |
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obligations for a purpose described by Section 326.152. |
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(b) Except as provided by Subsection (c), district bonds |
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issued under Subsection (a) are a lien on the library system |
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revenue: |
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(1) in the order of issuance; and |
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(2) inferior to a lien securing payment of outstanding |
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bonds. |
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(c) A district may issue additional bonds under this section |
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on a parity and of equal dignity with the outstanding bonds if the |
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resolution, order, deed of trust, or indenture of trust authorizing |
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or securing the outstanding bonds provides for the subsequent |
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issuance of additional parity bonds, subject to that resolution, |
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order, deed of trust, or indenture of trust. |
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(d) To the extent of a conflict or inconsistency between |
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this section and another law, this section controls. |
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Sec. 326.159. CREDIT AGREEMENT FOR RESERVE FUND. (a) The |
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board may provide that in lieu of or in addition to providing a cash |
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reserve, a credit agreement may be used to provide the reserve. |
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(b) A credit agreement obtained to provide a reserve must be |
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submitted to the attorney general for examination and approval. |
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After approval by the attorney general, the credit agreement is |
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incontestable in any court or other forum for any reason and is a |
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binding obligation of the district in accordance with its terms for |
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all purposes. |
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SECTION 2. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2007. |