| 1 | 1 | | 89R15749 JCG-F |
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| 2 | 2 | | By: Miles S.B. No. 2904 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | |
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| 6 | 6 | | |
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| 7 | 7 | | A BILL TO BE ENTITLED |
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| 8 | 8 | | AN ACT |
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| 9 | 9 | | relating to the issuance of obligations by certain counties to pay |
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| 10 | 10 | | the unfunded liabilities of the county to a public retirement |
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| 11 | 11 | | system. |
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| 12 | 12 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 13 | 13 | | SECTION 1. Subtitle I, Title 9, Government Code, is amended |
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| 14 | 14 | | by adding Chapter 1480 to read as follows: |
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| 15 | 15 | | CHAPTER 1480. OBLIGATIONS FOR UNFUNDED LIABILITIES OF CERTAIN |
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| 16 | 16 | | COUNTIES TO PUBLIC RETIREMENT SYSTEMS |
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| 17 | 17 | | Sec. 1480.001. DEFINITIONS. In this chapter: |
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| 18 | 18 | | (1) "Obligation" includes a bond, certificate, note, |
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| 19 | 19 | | or book entry obligation. |
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| 20 | 20 | | (2) "Public retirement system" has the meaning |
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| 21 | 21 | | assigned by Section 802.001. |
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| 22 | 22 | | (3) "Unfunded liability" means an unfunded, accrued |
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| 23 | 23 | | liability of a county to a public retirement system as determined by |
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| 24 | 24 | | actuarial analysis. |
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| 25 | 25 | | Sec. 1480.002. APPLICABILITY. This chapter applies only to |
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| 26 | 26 | | a county with a population of 800,000 or more that is located |
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| 27 | 27 | | adjacent to a county with a population of four million or more. |
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| 28 | 28 | | Sec. 1480.003. OBLIGATIONS AUTHORIZED. (a) A county may |
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| 29 | 29 | | issue obligations to fund all or any part of an unfunded liability. |
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| 30 | 30 | | (b) Before authorizing issuance and delivery of an |
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| 31 | 31 | | obligation under this section, the commissioners court of the |
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| 32 | 32 | | county must enter into a written agreement with the governing body |
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| 33 | 33 | | of the public retirement system that: |
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| 34 | 34 | | (1) has fiduciary responsibility for assets of the |
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| 35 | 35 | | trust fund that is to receive the net proceeds of the obligations to |
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| 36 | 36 | | be issued; and |
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| 37 | 37 | | (2) has the duty to oversee the investment and |
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| 38 | 38 | | expenditure of the assets of the fund. |
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| 39 | 39 | | (c) The written agreement must state the amount of the |
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| 40 | 40 | | unfunded liability and the date or dates on which the public |
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| 41 | 41 | | retirement system will accept the net proceeds of the obligations |
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| 42 | 42 | | to be issued in payment of all or a portion of the unfunded |
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| 43 | 43 | | liability. |
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| 44 | 44 | | Sec. 1480.004. VOTER APPROVAL REQUIRED. A county may issue |
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| 45 | 45 | | an obligation under this chapter to fund all or any part of the |
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| 46 | 46 | | unfunded liability of a public retirement system associated with |
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| 47 | 47 | | the county to which this chapter applies only if the issuance is |
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| 48 | 48 | | approved by a majority of the qualified voters of the county voting |
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| 49 | 49 | | at an election held for that purpose. |
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| 50 | 50 | | Sec. 1480.005. PROCEEDS OF OBLIGATIONS ISSUED. The county |
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| 51 | 51 | | shall deposit the net proceeds of obligations issued under this |
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| 52 | 52 | | chapter to the credit of the public retirement system. The amount |
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| 53 | 53 | | deposited under this section becomes part of the public retirement |
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| 54 | 54 | | system's assets. |
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| 55 | 55 | | Sec. 1480.006. PAYMENT OF OBLIGATIONS. (a) An obligation |
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| 56 | 56 | | issued under this chapter may be made payable by the county from: |
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| 57 | 57 | | (1) the fund from which compensation is paid to its |
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| 58 | 58 | | officers and employees; |
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| 59 | 59 | | (2) its general fund; or |
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| 60 | 60 | | (3) except as provided by Subsection (b), taxes, |
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| 61 | 61 | | revenues, both taxes and revenues, or any other source or |
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| 62 | 62 | | combination of sources of money that the county may use under state |
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| 63 | 63 | | law to secure or pay any kind of bond or obligation. |
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| 64 | 64 | | (b) An obligation issued under this chapter may not be made |
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| 65 | 65 | | payable by the county from ad valorem taxes. |
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| 66 | 66 | | (c) Notwithstanding any provision of the Tax Code, a county |
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| 67 | 67 | | may pledge anticipated revenue from the imposition of sales and use |
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| 68 | 68 | | taxes to secure the payment of an obligation authorized by this |
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| 69 | 69 | | chapter for a period not longer than 30 years. |
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| 70 | 70 | | Sec. 1480.007. OBLIGATION AS REFINANCING. An obligation |
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| 71 | 71 | | issued under this chapter is a complete or partial refinancing of a |
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| 72 | 72 | | commitment of the county to fund its unfunded liability. |
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| 73 | 73 | | Sec. 1480.008. SALE OF OBLIGATIONS; MATURITY. Obligations |
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| 74 | 74 | | issued under this chapter may be sold at private or public sale and |
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| 75 | 75 | | must mature not later than the 30th anniversary of the date of |
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| 76 | 76 | | issuance. |
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| 77 | 77 | | Sec. 1480.009. CREDIT AGREEMENTS. (a) In this section, |
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| 78 | 78 | | "credit agreement" and "obligation" have the meanings assigned by |
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| 79 | 79 | | Section 1371.001, Government Code. |
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| 80 | 80 | | (b) The governing body of a county that issues obligations |
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| 81 | 81 | | under this chapter may exercise any of the rights or powers of the |
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| 82 | 82 | | governing body of an issuer under Chapter 1371, Government Code, |
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| 83 | 83 | | and may enter into a credit agreement under that chapter. An |
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| 84 | 84 | | obligation issued under this chapter is an obligation under Chapter |
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| 85 | 85 | | 1371, Government Code, but is not required to be rated as required |
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| 86 | 86 | | by that chapter. |
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| 87 | 87 | | Sec. 1480.010. CHAPTER CONTROLLING. To the extent of any |
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| 88 | 88 | | conflict between this chapter and another law, this chapter |
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| 89 | 89 | | prevails. |
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| 90 | 90 | | SECTION 2. This Act takes effect immediately if it receives |
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| 91 | 91 | | a vote of two-thirds of all the members elected to each house, as |
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| 92 | 92 | | provided by Section 39, Article III, Texas Constitution. If this |
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| 93 | 93 | | Act does not receive the vote necessary for immediate effect, this |
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| 94 | 94 | | Act takes effect September 1, 2025. |
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