| 1 | 1 | | By: Campbell S.B. No. 573 |
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| 2 | 2 | | (In the Senate - Filed February 13, 2015; February 23, 2015, |
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| 3 | 3 | | read first time and referred to Committee on Intergovernmental |
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| 4 | 4 | | Relations; May 20, 2015, reported favorably by the following vote: |
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| 5 | 5 | | Yeas 4, Nays 3; May 20, 2015, sent to printer.) |
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| 6 | 6 | | Click here to see the committee vote |
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| 7 | 7 | | |
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| 8 | 8 | | |
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| 9 | 9 | | A BILL TO BE ENTITLED |
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| 10 | 10 | | AN ACT |
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| 11 | 11 | | relating to the issuance of certain capital appreciation bonds by |
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| 12 | 12 | | political subdivisions. |
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| 13 | 13 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 14 | 14 | | SECTION 1. Subchapter B, Chapter 1201, Government Code, is |
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| 15 | 15 | | amended by adding Section 1201.0245 to read as follows: |
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| 16 | 16 | | Sec. 1201.0245. ISSUANCE OF CAPITAL APPRECIATION BONDS BY |
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| 17 | 17 | | LOCAL GOVERNMENTS. (a) In this section, "capital appreciation |
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| 18 | 18 | | bond" means a bond that accrues and compounds interest from its date |
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| 19 | 19 | | of delivery, the interest on which by its terms is payable only upon |
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| 20 | 20 | | maturity or prior redemption. |
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| 21 | 21 | | (b) The total amount of capital appreciation bonds issued by |
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| 22 | 22 | | a county, municipality, special district, school district, junior |
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| 23 | 23 | | college district, or other political subdivision that are secured |
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| 24 | 24 | | by ad valorem taxes may not exceed 25 percent of the political |
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| 25 | 25 | | subdivision's total outstanding bonded indebtedness at the time of |
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| 26 | 26 | | the issuance, including the amount of principal and interest to be |
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| 27 | 27 | | paid on the outstanding bonds until maturity. |
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| 28 | 28 | | (c) Subsection (b) does not apply to the issuance of: |
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| 29 | 29 | | (1) refunding bonds under Chapter 1207; or |
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| 30 | 30 | | (2) capital appreciation bonds for financing |
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| 31 | 31 | | transportation projects. |
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| 32 | 32 | | SECTION 2. The change in law made by this Act does not |
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| 33 | 33 | | affect the validity of capital appreciation bonds issued before the |
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| 34 | 34 | | effective date of this Act. |
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| 35 | 35 | | SECTION 3. This Act takes effect September 1, 2015. |
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| 36 | 36 | | * * * * * |
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