H.B. No. 878

AN ACT

relating to the Sweeny Hospital District.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 4, Chapter 135, Acts of the 58th Legislature, Regular Session, 1963, is amended to read as follows:

Sec. 4. The management and control of the [each hospital] district [created pursuant to the provisions of this Act] is hereby vested in the board of directors of the district who shall serve without compensation but may be reimbursed for actual expenses incurred in the performance of their official duties upon the approval of such expenses by the entire board of directors.

SECTION 2. Chapter 135, Acts of the 58th Legislature, Regular Session, 1963, is amended by adding Sections 6A and 6B to read as follows:

Sec. 6A. In addition to the authority to issue general obligation bonds and revenue bonds under this Act, the board may provide for the security and payment of district bonds from a pledge of a combination of ad valorem taxes as authorized by Section 6(a) of this Act and revenue and other sources as authorized by Section 6(e) of this Act.

Sec. 6B. The district may use the proceeds of bonds issued under this Act to pay:

(1) any expense the board determines is reasonable and necessary to issue, sell, and deliver the bonds;

(2) interest payments on the bonds during a period of acquisition or construction of a project or facility to be provided through the bonds, not to exceed five years;

(3) costs related to the operation and maintenance of a project or facility to be provided through the bonds:

(A) during an estimated period of acquisition or construction, not to exceed five years; and

(B) for one year after the project or facility is acquired or constructed;

(4) costs related to the financing of the bond funds, including debt service reserve and contingency funds;

(5) costs related to the bond issuance;

(6) costs related to the acquisition of land or interests in land for a project or facility to be provided through the bonds; and

(7) costs of construction of a project or facility to be provided through the bonds, including the payment of related professional services and expenses.

SECTION 3. Chapter 135, Acts of the 58th Legislature, Regular Session, 1963, is amended by adding Section 7B to read as follows:

Sec. 7B. (a) The board may borrow money at a rate not to exceed the maximum annual percentage rate allowed by law for district obligations at the time the loan is made.

(b) To secure a loan, the board may pledge:

(1) district revenue that is not pledged to pay the district's bonded indebtedness;

(2) a district tax to be imposed by the district during the 12-month period following the date of the pledge that is not pledged to pay the principal of or interest on district bonds; or

(3) a district bond that has been authorized but not sold.

(c) A loan for which taxes or bonds are pledged must mature not later than the first anniversary of the date the loan is made. A loan for which district revenue is pledged must mature not later than the fifth anniversary of the date the loan is made.

SECTION 4. 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, 2009.

______________________________ ______________________________

President of the Senate Speaker of the House

I certify that H.B. No. 878 was passed by the House on May 5, 2009, by the following vote: Yeas 144, Nays 0, 1 present, not voting.

______________________________ Chief Clerk of the House

I certify that H.B. No. 878 was passed by the Senate on May 26, 2009, by the following vote: Yeas 31, Nays 0.

______________________________ Secretary of the Senate APPROVED: _____________________

Date

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Governor