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Texas Education Code - Section 65.46. Powers Related To Issuance Of Bonds And Notes

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§ 65.46. POWERS RELATED TO ISSUANCE OF BONDS AND 
NOTES.  (a) In this section:
		(1)  "Bond" or "note" means a bond or note that the 
board is authorized to issue according to law, including Article 
VII, Section 18, of the Texas Constitution, Chapter 55 or 66 of this 
code, or other applicable law.
		(2)  "Credit agreement" means a loan agreement, 
revolving credit agreement, agreement establishing a line of 
credit, letter of credit, reimbursement agreement, insurance 
contract, commitment to purchase bonds or notes, purchase or sale 
agreement, or another commitment, contract, or agreement 
authorized and approved by the board in connection with the 
authorization, issuance, security, exchange, payment, purchase, or 
redemption of bonds or notes or interest on bonds or notes.
	(b)  To enhance the security for, or provide for the 
purchase, payment, redemption, or remarketing of, bonds or notes 
and the interest on bonds or notes, or to reduce the cost of 
interest payable on bonds or notes, the board may enter into credit 
agreements in relation to bonds or notes, and may secure its 
obligations under the credit agreements by pledging, encumbering, 
or granting liens on or security interests in revenues, funds, or 
other property or security that may be pledged or encumbered or made 
subject to a lien or security interest to secure the bonds or notes 
that are secured by the credit agreement.  The cost to the board of 
the credit agreement and the obligations of the board under the 
credit agreement may be paid from proceeds of the sale of bonds or 
notes to which the credit agreement relates or from any other source 
that is available for the purpose of paying the bonds or notes and 
the interest on the bonds or notes or that may otherwise be legally 
available to make those payments.  The credit agreement shall be 
submitted, together with the bonds or notes, to the attorney 
general for review.  If the attorney general finds that the credit 
agreement conforms to applicable law, the attorney general shall 
approve the credit agreement with the bonds or notes.  On approval 
and delivery, the credit agreement is incontestable for any cause.
	(c)  The board may authorize bonds or notes to bear interest 
at a rate or rates (either fixed, variable, floating, adjustable, 
or otherwise, all as determined in accordance with the resolution 
authorizing the issuance of the bonds or notes, which may provide a 
formula, index, or contractual arrangement for the periodic 
determination of interest rates without the requirement of specific 
approval, by the board, of each determination) not to exceed the 
maximum net effective interest rate allowed by law.  The resolution 
under which the bonds or notes are issued may delegate to one or 
more designated officers, employees, or agents of the board the 
authority to act on behalf of the board, while the bonds or notes 
remain outstanding, in fixing dates, prices, interest rates, 
interest payment periods, and other procedures specified in the 
resolution so that, among other things, the interest on the bonds or 
notes may be adjusted from time to time by the officer, employee, or 
agent to permit the bonds or notes to be sold or resold at par in 
conjunction with secondary market transactions.
	(d)  The board may enter into financing programs under which 
the board may issue notes for any lawful purpose for which bonds or 
notes may be issued and may make provision for the notes initially 
issued under the programs to be refinanced, renewed, or refunded 
throughout the period of the programs by the issuance, sale, and 
delivery of additional notes.  The notes may be secured in any 
manner provided by law for securing notes or bonds, and also may be 
secured by the proceeds of the sale of notes, the proceeds of the 
sale of bonds, or credit agreements, all as the board provides in 
the resolution authorizing the financing program and the issuance 
of notes under the program.  The board may:
		(1)  provide in the resolution authorizing the 
financing program for the maximum principal amount of notes to be 
outstanding at any time under the financing program;
		(2)  provide for the authorization of one or more 
officers or employees of the board to act on behalf of the board in 
selling and delivering notes and fixing their dates, prices, 
interest rates, terms of payment, and other procedures relating to 
the notes as specified in the resolution;
		(3)  contract for the future sale of notes under which 
designated purchasers are committed to purchase notes from time to 
time on the terms and conditions stated in the contract, including a 
credit agreement executed in connection with the notes;
		(4)  provide for the payment of consideration that the 
board considers proper for the purchase commitments, and provide 
for the payment of the consideration out of proceeds from the sale 
of notes or from any other source that is available for the purpose 
of paying the notes or that may otherwise be legally available to 
make the payments;  and
		(5)  exercise any other rights and powers that are 
granted to issuers of obligations under Chapter 1371, Government 
Code, which also governs the approval by the attorney general of the 
notes, related credit agreements, and other contracts or 
instruments and the registration of the notes by the comptroller.
	(e)  This section shall be construed liberally to effect the 
legislative intent and purposes of this section, and all powers 
granted by this section shall be broadly interpreted to effect that 
intent and those purposes and not as a limitation of powers.

Added by Acts 1985, 69th Leg., ch. 919, § 1, eff. June 15, 1985.  
Amended by Acts 2001, 77th Leg., ch. 1420, § 8.223, eff. Sept. 1, 
2001.

Last modified: August 11, 2007