Texas Special District Local Laws Code 8501.263 – Additional Security for Obligation: Mortgage and Encumbrance
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(a) As additional security for the payment of an obligation issued under this chapter, the board may have executed in favor of the holders of the obligations an indenture mortgaging and encumbering:
(1) the improvements, facilities, and other property acquired with the proceeds of the sale of the obligation; or
(2) all the improvements, facilities, and other property of the authority.
(b) In the encumbrance, the board may provide for granting to any purchaser at a foreclosure sale under the encumbrance a franchise to operate the improvements, facilities, and other property for a term not to exceed 50 years after the date of the purchase, subject to the laws regulating the matter.
Terms Used In Texas Special District Local Laws Code 8501.263
- Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
- 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.
- Property: means real and personal property. See Texas Government Code 311.005
(c) The indenture:
(1) may contain the provisions the board considers proper; and
(2) is enforceable in the manner provided by the laws of this state for the enforcement of other mortgages and encumbrances.