By: Bettencourt, Birdwell S.B. No. 1329
A BILL TO BE ENTITLED
AN ACT
relating to bonds issued by and the dissolution of municipal
management districts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter M, Chapter 375, Local Government
Code, is amended by adding Section 375.2621 to read as follows:
Sec. 375.2621. PROHIBITION ON ISSUANCE OF BONDS AFTER
PETITION. The district may not issue bonds after the date a
petition for dissolution under Section 375.262 is filed with the
board.
SECTION 2. Section 375.264, Local Government Code, is
amended to read as follows:
Sec. 375.264. LIMITATIONS [LIMITATION] ON DISSOLUTION BY
BOARD OF DISTRICT WITH DEBT. (a) A district may not be dissolved
by its board under Section 375.261 or after a petition is filed
under Section 375.262 if the district has [any] outstanding bonded
indebtedness until that bonded indebtedness has been repaid or
defeased in accordance with the order or resolution authorizing the
issuance of the bonds.
(b) After a petition is filed under Section 375.262 with the
board of a district that has outstanding bonded indebtedness:
(1) the district shall remain in existence solely for
the purpose of discharging its bonded indebtedness; and
(2) the board shall use all district money that is
available for the purpose to repay or defease all bonded
indebtedness as soon as practicable in accordance with the order or
resolution authorizing the issuance of the bonds.
SECTION 3. The changes in law made by this Act apply only to
a municipal management district that is the subject of a petition
described by Section 375.262, Local Government Code, filed with the
board on or after the effective date of this Act. A district that is
the subject of such a petition filed with the board before the
effective date of this Act is governed by the law in effect on the
date the petition was filed, and the former law is continued in
effect for that purpose.
SECTION 4. The changes in law made by this Act may not be
construed to impair an obligation under a contract entered into
before the effective date of this Act. A political subdivision may
fulfill the subdivision's obligations under a contract entered into
before that date but may not extend such a contract beyond the
contract's original term.
SECTION 5. This Act takes effect September 1, 2019.