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A BILL TO BE ENTITLED
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AN ACT
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relating to limitations on issuance by school districts of |
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tax-supported bonds. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter A, Chapter 45, Education Code, is |
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amended by adding Section 45.0035 to read as follows: |
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Sec. 45.0035. LIMITATIONS ON ISSUANCE OF TAX-SUPPORTED |
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BONDS. (a) Except as otherwise provided by this subsection, a |
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school district's local bonded indebtedness limit is an amount |
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equal to 10 percent of the assessed valuation of taxable property in |
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the district according to the most recent certified ad valorem tax |
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rolls of the district. For a district with a student enrollment of |
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less than 4,000, the district's local bonded indebtedness limit is |
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an amount equal to 12 percent of the assessed valuation of taxable |
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property in the district according to the most recent certified ad |
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valorem tax rolls of the district. For a district that has had a |
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student enrollment growth of at least 15 percent over the |
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three-year period preceding the year in which bonds are issued, the |
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district's local bonded indebtedness limit is the otherwise |
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applicable limit computed under this subsection plus an amount |
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equal to the product of 10 percent of the student enrollment growth |
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rate for that three-year period multiplied by the assessed |
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valuation of taxable property in the district. |
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(b) A school district's state funding percentage is the |
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quotient of the amount of state assistance received by the district |
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under Chapter 46 for the payment of debt service for the preceding |
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school year divided by the aggregate amount of debt service paid on |
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the district's bonded indebtedness for the preceding school year, |
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expressed as a percentage. |
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(c) A school district's adjusted local bonded indebtedness |
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limit is an amount equal to the sum of: |
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(1) the district's applicable local bonded |
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indebtedness limit as computed under Subsection (a); and |
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(2) an amount equal to the product of 20 percent of the |
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district's state funding percentage as computed under Subsection |
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(b) multiplied by the assessed valuation of taxable property in the |
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district. |
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(d) A school district may issue bonds described by Section |
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45.001 only if: |
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(1) after the issuance of those bonds, the aggregate |
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principal amount of the district's outstanding bonded indebtedness |
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would not exceed the district's adjusted local bonded indebtedness |
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limit as determined under Subsection (c); and |
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(2) the district has adopted: |
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(A) a debt management policy as provided by |
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Subsection (e); and |
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(B) a capital improvement plan as provided by |
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Subsection (f). |
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(e) A school district's debt management policy as required |
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by Subsection (d)(2)(A) must: |
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(1) address the district's ability to: |
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(A) maintain financial stability; |
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(B) provide debt management flexibility; |
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(C) meet future facility needs; |
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(D) maintain public trust; |
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(E) minimize costs to taxpayers; |
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(F) maintain access to capital markets; and |
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(G) receive the highest ratings on district bonds |
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from independent credit rating agencies; and |
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(2) demonstrate to taxpayers administrative oversight |
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of bond programs. |
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(f) A school district's capital improvement plan as |
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required under Subsection (d)(2)(B) must: |
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(1) address the location, timing, and financing of |
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district capital improvements over a multiyear period of not less |
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than five years; |
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(2) describe: |
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(A) significant, nonrecurring expenditures for |
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real property, improvements to real property, and equipment for the |
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improvements; and |
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(B) intended financing sources and development |
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schedules for capital improvement projects; and |
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(3) be reviewed at an annual public hearing provided |
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by the district. |
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(g) In addition to the limitation imposed by Subsection (d), |
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a school district may not issue bonds described by Section 45.001 |
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for the construction, acquisition, or equipping of an athletic |
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facility designed to be used primarily for a purpose other than for |
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teaching the curriculum required under Section 28.002 if, after the |
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issuance of those bonds, the aggregate principal amount of |
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outstanding bonds issued after September 1, 2011, for such a |
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purpose would exceed an amount equal to 10 percent of the district's |
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adjusted local bonded indebtedness limit as computed under |
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Subsection (c). |
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(h) For purposes of this section, the amount of a school |
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district's bonded indebtedness does not include the amount of any |
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bonded indebtedness resulting from the issuance of bonds for the |
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construction, acquisition, or equipping of a school building to |
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replace a school building lost due to fire or a natural disaster, |
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less any amount paid by insurance covering the loss. |
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SECTION 2. Section 45.0031, Education Code, is repealed. |
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SECTION 3. Section 45.0035, Education Code, as added by |
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this Act, applies to school district bonds issued on or after the |
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effective date of this Act, regardless of whether the bonds were |
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approved by voters before, on, or after the effective date of this |
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Act. School district bonds approved by voters and issued before the |
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effective date of this Act are governed by the law in effect on the |
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date the bonds were issued, and that law is continued in effect for |
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that purpose. |
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SECTION 4. This Act takes effect September 1, 2011. |