Bill Text: TX HB440 | 2019-2020 | 86th Legislature | Enrolled

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Bill Title: Relating to general obligation bonds issued by political subdivisions.

Sponsorship: Slight Partisan Bill (Republican 4-2)

Status: (Passed) 2019-06-10 - Effective on 9/1/19 [HB440 Detail]

Download: Texas-2019-HB440-Enrolled.html

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H.B. No. 440

AN ACT
relating to general obligation bonds issued by political
subdivisions.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter E, Chapter 45, Education Code, is
amended by adding Section 45.1105 to read as follows:
Sec. 45.1105. USE OF UNSPENT GENERAL OBLIGATION BOND
PROCEEDS. (a) A school district may use the unspent proceeds of
issued general obligation bonds only:
(1) for the specific purposes for which the bonds were
authorized;
(2) to retire the bonds; or
(3) for a purpose other than the specific purposes for
which the bonds were authorized if:
(A) the specific purposes are accomplished or
abandoned; and
(B) the board of trustees at a public meeting
held only for the purpose of considering the use of the unspent bond
proceeds approves in separate votes the use of the proceeds for:
(i) a purpose other than to retire the
bonds; and
(ii) the purpose specified at the time the
vote is taken.
(b) In addition to other requirements of law, notice of a
public meeting held under this section must include a statement
that the board of trustees will consider the use of unspent bond
proceeds for a purpose other than the specific purposes for which
the bonds were authorized.
(c) A public meeting held under this section must provide
the public an opportunity to address the board of trustees on the
question of using the unspent bond proceeds for a purpose other than
the specific purposes for which the bonds were authorized.
SECTION 2. Section 4.003(f), Election Code, is amended to
read as follows:
(f) A debt obligation election order required under Section
3.009 shall be posted:
(1) on election day and during early voting by
personal appearance, in a prominent location at each polling place;
(2) not later than the 21st day before the election, in
three public places in the boundaries of the political subdivision
holding the election; and
(3) during the 21 days before the election, on the
political subdivision's Internet website, prominently and together
with the notice of the election, [and] the contents of the
proposition, and any sample ballot prepared for the election, if
the political subdivision maintains an Internet website.
SECTION 3. Subtitle C, Title 9, Government Code, is amended
by adding Chapter 1253 to read as follows:
CHAPTER 1253. GENERAL OBLIGATION BONDS ISSUED BY POLITICAL
SUBDIVISIONS
Sec. 1253.001. DEFINITION. In this chapter, "political
subdivision" means a county, municipality, school district, junior
college district, other special district, or other subdivision of
state government.
Sec. 1253.002. LIMITATION ON AUTHORITY TO ISSUE GENERAL
OBLIGATION BONDS. (a) In this section, "personal property" has the
meaning assigned by Section 1.04, Tax Code.
(b) Notwithstanding any other provision of law, a political
subdivision may not issue general obligation bonds to purchase,
improve, or construct one or more improvements to real property, to
purchase one or more items of personal property, or to do both, if
the weighted average maturity of the issue of bonds exceeds 120
percent of the reasonably expected weighted average economic life
of the improvements and personal property financed with the issue
of bonds.
Sec. 1253.003. USE OF UNSPENT GENERAL OBLIGATION BOND
PROCEEDS. (a) A political subdivision other than a school district
may use the unspent proceeds of issued general obligation bonds
only:
(1) for the specific purposes for which the bonds were
authorized;
(2) to retire the bonds; or
(3) for a purpose other than the specific purposes for
which the bonds were authorized if:
(A) the specific purposes are accomplished or
abandoned; and
(B) a majority of the votes cast in an election
held in the political subdivision approve the use of the proceeds
for the proposed purpose.
(b) The election order and the notice of election for an
election described by Subsection (a)(3)(B) must state the proposed
purpose for which the bond proceeds are to be used.
(c) A political subdivision must hold an election described
by Subsection (a)(3)(B) in the same manner as an election to issue
bonds in the political subdivision.
SECTION 4. Chapter 1332, Government Code, is repealed.
SECTION 5. Section 1253.002, Government Code, as added by
this Act, applies only to a general obligation bond authorized to be
issued at an election held on or after the effective date of this
Act.
SECTION 6. This Act takes effect September 1, 2019.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 440 was passed by the House on
April
2, 2019, by the following vote: Yeas 146, Nays 1, 1 present,
not voting; and that the House concurred in Senate amendments to
H.B. No. 440 on May 22, 2019, by the following vote: Yeas 144, Nays
0, 1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 440 was passed by the Senate, with
amendments, on May 14, 2019, by the following vote: Yeas 31, Nays
0.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor