80R15145 MXM-D
 
  By: Macias H.B. No. 3125
 
Substitute the following for H.B. No. 3125:
 
  By:  Solomons C.S.H.B. No. 3125
 
A BILL TO BE ENTITLED
AN ACT
relating to the issuance of bonds or other obligations by library
districts.
       BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
       SECTION 1.  Chapter 326, Local Government Code, is amended
by adding Subchapter F to read as follows:
SUBCHAPTER F.  MONEY FOR LIBRARY SYSTEM; BONDS
       Sec. 326.151.  DEFINITIONS. In this subchapter:
             (1)  "Bond" has the meaning assigned to "public
security" by Section 1201.002, Government Code.
             (2)  "Credit agreement" has the meaning assigned by
Section 1371.001, Government Code.
       Sec. 326.152.  MONEY FOR LIBRARY SYSTEM.  (a) The board may
provide money to acquire, purchase, construct, improve, renovate,
enlarge, or equip property, buildings, structures, or related
infrastructure for a public library.
       (b)  In connection with exercising the authority to provide
money for a purpose described by Subsection (a), the board may
provide money to acquire, purchase, or otherwise obtain any
interest in property.
       Sec. 326.153.  AUTHORITY TO ISSUE BONDS.  The board may issue
bonds and incur obligations under contracts in accordance with this
chapter for a purpose described by Section 326.152.
       Sec. 326.154.  PLEDGE OF REVENUE AND SALES TAXES. (a) The
board may pledge to the payment of any bonds issued or any
obligations incurred under Section 326.153 all or any part of the
revenue of the district's library system or the district's sales and
use tax.
       (b)  The board may grant a lien on the pledged revenue.  The
lien has the priority determined by the board.
       Sec. 326.155.  GRANT OF MORTGAGE OR FRANCHISE. As
additional security for district bonds or other obligations, the
district by the terms of the encumbrance may grant a purchaser under
sale or foreclosure a mortgage or a franchise to operate the
encumbered library system for a term not to exceed 20 years from the
date of purchase, subject to all laws regulating the operation of
the library system in force at the time of the sale or foreclosure.
       Sec. 326.156.  USE AND INVESTMENT OF PROCEEDS. (a) To the
extent provided by the proceedings authorizing the issuance of
district bonds, a district may use proceeds from the sale of
district bonds to provide money for a library system under this
chapter for a purpose authorized by Section 326.152.
       (b)  A district may use proceeds from the sale of district
bonds to pay interest on the bonds during the period of the
acquisition or construction of any property to be provided through
the issuance of the bonds, and for one year after completion of the
acquisition or construction of the property.
       (c)  A district may use proceeds from the sale of district
bonds to:
             (1)  provide a reserve for the payment of debt service
on the bonds;
             (2)  provide a reserve for extraordinary repairs and
replacements; or
             (3)  obtain a credit agreement as provided by Section
326.159.
       (d)  A district may invest proceeds from the sale of district
bonds to the extent and in the manner provided in the proceedings
authorizing the issuance of the bonds.
       Sec. 326.157.  MATURITY. District bonds must mature not
later than 30 years after their date of issuance.
       Sec. 326.158.  ADDITIONAL OBLIGATIONS TO IMPROVE OR EXTEND
LIBRARY SYSTEM. (a) A district that has outstanding bonds secured
by library system revenue may issue additional bonds or incur other
obligations for a purpose described by Section 326.152.
       (b)  Except as provided by Subsection (c), district bonds
issued under Subsection (a) are a lien on the library system
revenue:
             (1)  in the order of issuance; and
             (2)  inferior to a lien securing payment of outstanding
bonds.
       (c)  A district may issue additional bonds under this section
on a parity and of equal dignity with the outstanding bonds if the
resolution, order, deed of trust, or indenture of trust authorizing
or securing the outstanding bonds provides for the subsequent
issuance of additional parity bonds, subject to that resolution,
order, deed of trust, or indenture of trust.
       (d)  To the extent of a conflict or inconsistency between
this section and another law, this section controls.
       Sec. 326.159.  CREDIT AGREEMENT FOR RESERVE FUND. (a) The
board may provide that in lieu of or in addition to providing a cash
reserve, a credit agreement may be used to provide the reserve.
       (b)  A credit agreement obtained to provide a reserve must be
submitted to the attorney general for examination and approval.
After approval by the attorney general, the credit agreement is
incontestable in any court or other forum for any reason and is a
binding obligation of the district in accordance with its terms for
all purposes.
       SECTION 2.  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, 2007.