| (4) To ensure that the charter district reimburses
the reserve fund and the PSF, if applicable, the commissioner will
withhold from state funds otherwise payable to the charter district
the amount that the charter district owes in reimbursement.
(5) Funds intercepted for reimbursement under paragraph
(4) of this subsection will be used to fully reimburse the PSF before
any funds reimburse the reserve fund. If the funds intercepted under
paragraph (4) of this subsection are insufficient to fully reimburse
the PSF with interest, subsequent payments into the reserve fund will
first be applied to any outstanding obligation to the PSF.
(6) Following full reimbursement to the reserve fund
and the PSF, if applicable, with interest, the comptroller will further
cancel the bond or coupon and forward it to the charter district for
which payment was made. Interest will be charged at the rate determined
under the Texas Government Code (TGC), §2251.025(b). Interest
will accrue as specified in the TGC, §2251.025(a) and (c). For
purposes of this section, the "date the payment becomes overdue" that
is referred to in the TGC, §2251.025(a), is the date that the
comptroller makes the payment to the charter district's paying agent.
(n) Bonds not accelerated on default. If a charter
district fails to pay principal or interest on a guaranteed bond when
it matures, other amounts not yet mature are not accelerated and do
not become due by virtue of the charter district's default.
(o) Reimbursement of Charter District Bond Guarantee
Reserve Fund or PSF. If payment from the Charter District Bond Guarantee
Reserve Fund or the PSF is made on behalf of a charter district, the
charter district must reimburse the amount of the payment, plus interest,
in accordance with the requirements of TEC, §45.061.
(p) Repeated failure to pay. If a total of two or more
payments are made under the BGP on the bonds of a charter district,
the commissioner may take action in accordance with the provisions
of TEC, §45.062.
(q) Report on the use of funds and confirmation of
use of funds by independent auditor. A charter district that issues
bonds approved for the guarantee must report to TEA annually in a
form prescribed by the commissioner on the use of the bond funds until
all bond proceeds have been spent. The charter district's independent
auditor must confirm in the charter district's annual financial report
that bond funds have been used in accordance with the purpose specified
in the application for the guarantee.
(r) Failure to comply with statute or this section.
An open-enrollment charter holder's failure to comply with the requirements
of TEC, Chapter 45, Subchapter C, or with the requirements of this
section, including by making any material misrepresentations in the
charter holder's application for charter district designation and
the guarantee, constitutes a material violation of the open-enrollment
charter holder's charter.
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