89R9895 AMF-D
By: Harrison H.B. No. 5035
A BILL TO BE ENTITLED
AN ACT
relating to a prohibition on the guarantee of public school bonds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. GUARANTEE OF PUBLIC SCHOOL BONDS PROHIBITED
SECTION 1.001. The heading to Subchapter C, Chapter 45,
Education Code, is amended to read as follows:
SUBCHAPTER C. GUARANTEE OF [GUARANTEED] BONDS PROHIBITED
SECTION 1.002. Section 45.052, Education Code, is amended
to read as follows:
Sec. 45.052. GUARANTEE OF BONDS PROHIBITED. (a) Bonds [On
approval by the commissioner, bonds] issued under Subchapter A by a
school district or Chapter 53 for a charter district, including
refunding and refinanced bonds, may not be [are] guaranteed or
otherwise underwritten by the corpus and income of the permanent
school fund.
(b) A [Notwithstanding any amendment of this subchapter or
other law, the] guarantee of or credit enhancement provided for a
[under this subchapter of] school district or charter district bond
approved before September 1, 2025, [bonds] remains in effect until
the date those bonds mature or are defeased in accordance with state
law.
ARTICLE 2. CONFORMING CHANGES
SECTION 2.001. Section 12.141(c), Education Code, is
amended to read as follows:
(c) The agency shall annually review the amount of funds in
the charter school liquidation fund and transfer any funds
exceeding $2 million[:
[(1)] for use in funding a grant program established
by the agency to:
(1) [(A)] encourage high school students to enter the
teaching profession; and
(2) [(B)] assist current paraprofessionals and
instructional aides in pursuing the necessary credentials to become
full-time teachers[; or
[(2) to the comptroller to deposit in the charter
district bond guarantee reserve fund under Section 45.0571].
SECTION 2.002. Section 43.052(a), Education Code, is
amended to read as follows:
(a) The State Board of Education may incorporate the Texas
Permanent School Fund Corporation and delegate to the corporation
the board's authority to manage and invest[:
[(1)] the permanent school fund under Section 43.003[;
and
[(2) the charter district bond guarantee reserve fund
under Section 45.0571].
SECTION 2.003. Section 45.051(1-a), Education Code, is
amended to read as follows:
(1-a) "Charter district" means an open-enrollment
charter school designated as a charter district under Section
12.135 as that section existed immediately before September 1,
2025.
SECTION 2.004. Section 53.02(10), Education Code, is
amended to read as follows:
(10) "Authorized charter school" means an
open-enrollment charter school that holds a charter granted under
Subchapter D, Chapter 12[, and includes an open-enrollment charter
school designated as a charter district as provided by Section
12.135].
SECTION 2.005. Section 1201.0245(i), Government Code, is
amended to read as follows:
(i) A political subdivision may extend the maturity date of
an issued capital appreciation bond only if:
(1) the extension of the maturity date will decrease
the total amount of projected principal and interest to maturity;
or
(2) the political subdivision is a school district and
[:
[(A)] the maximum legally allowable tax rate for
indebtedness has been adopted[; and
[(B) the Texas Education Agency certifies in
writing that the solvency of the permanent school fund's bond
guarantee program would be threatened without the extension].
SECTION 2.006. The following provisions of the Education
Code are repealed:
(1) Section 7.055(b)(38);
(2) Section 7.102(c)(33);
(3) Section 12.135;
(4) Section 43.067;
(5) Sections 45.051(1) and (2);
(6) Sections 45.053, 45.0531, 45.0532, 45.0533,
45.054, 45.0541, 45.055, 45.056, 45.057, 45.0571, 45.058, 45.059,
45.0591, 45.060, 45.061, 45.062, and 45.063;
(7) Subchapter I, Chapter 45;
(8) Section 48.273(g); and
(9) Section 53.351(f-1).
ARTICLE 3. TRANSITION; EFFECTIVE DATE
SECTION 3.001. The change in law made by this Act applies
only to a guarantee of or credit enhancement provided for a school
district or charter district bond approved on or after the
effective date of this Act. A guarantee of or credit enhancement
provided for a school district or charter district bond approved
before the effective date of this Act remains in effect until the
date those bonds mature or are defeased in accordance with state
law, and the former law is continued for that purpose.
SECTION 3.002. This Act takes effect September 1, 2025.