Texas Special District Local Laws Code 1014.205 – Revenue or Special Obligation Bonds
Current as of: 2024 | Check for updates
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(a) The board may issue and sell revenue or special obligation bonds for the purposes provided by Section 1014.201.
(b) Special obligation bonds must be payable from the revenue of the district’s entire hospital system, including that portion originally acquired and all past or future extensions, additions, or replacements, excluding taxes, after deducting the cost of maintaining and operating the system. For purposes of this subsection, the cost of maintaining and operating the system:
(1) may include only the items set forth and defined in the resolution authorizing the bond issuance; and
(2) may not include the cost of providing medical or hospital care for the district’s needy inhabitants.
Terms Used In Texas Special District Local Laws Code 1014.205
- Deed: The legal instrument used to transfer title in real property from one person to another.
- Lien: A claim against real or personal property in satisfaction of a debt.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Personal property: All property that is not real property.
- Property: means real and personal property. See Texas Government Code 311.005
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- Year: means 12 consecutive months. See Texas Government Code 311.005
(c) A cost described by Subsection (b)(2) is a maintenance and operating expense for budget and tax purposes.
(d) The district may issue revenue bonds without an election.
(e) Revenue bonds may be additionally secured by:
(1) a mortgage or deed of trust on real property;
(2) a chattel mortgage on the district’s personal property; or
(3) both.
(f) The board may issue bonds that are a junior lien on the district’s net revenue or property and additional parity bonds under conditions specified in the bond resolution or trust indenture.
(g) Money for the payment of not more than two years’ interest on the bonds and an amount the board estimates will be required for maintenance and operating expenses during the first year of operation may be set aside out of the proceeds from the sale of the bonds.
(h) A revenue bond issued by the district must contain the following provision: “The holder of the bond may not demand payment of this bond or appurtenant coupons out of money raised or to be raised by taxation.”