Sec. 454.025. ENCUMBRANCE OF TRANSPORTATION SYSTEM. (a) To secure the payment of bonds or notes issued under this chapter, a municipality may encumber:
(1) all or any part of the mass transportation system;
(2) the property of the system, including a bus or other vehicle, machinery, and equipment of any kind used in the operation of the system;
(3) the revenue of the system;
(4) the franchise of the system; or
(5) any other thing relating to the system that is acquired or is to be acquired.
(b) A municipality may:
(1) encumber separately any property, including a bus or other vehicle, machinery, or equipment of any kind; or
(2) acquire, hold, use, or contract for any property, including a bus or other vehicle, machinery, or equipment of any kind, under a lease arrangement, chattel mortgage, or conditional sale, including an equipment trust transaction.
(c) This chapter does not prohibit a municipality from encumbering a transportation system for the purposes of purchasing, building, mortgaging, extending, or repairing, or reconstructing another system and purchasing necessary property in connection with the system.
Acts 1995, 74th Leg., ch. 165, Sec. 1, eff. Sept. 1, 1995.
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