| (a) Statutory provision. The commissioner of education
must administer the guarantee program for school district bonds according
to the provisions of Texas Education Code (TEC), Chapter 45, Subchapter
C.
(b) Definitions. The following definitions apply to
the guarantee program for school district bonds.
(1) Annual debt service--payments of principal and
interest on outstanding bonded debt scheduled to occur between September
1 and August 31 during the fiscal year in which the guarantee is sought
as reported by the Municipal Advisory Council (MAC) of Texas or its
successor, if the district has outstanding bonded indebtedness.
(A) The annual debt service will be determined by the
current report of the bonded indebtedness of the district as reported
by the MAC of Texas or its successor as of the date of the application
deadline.
(B) The annual debt service does not include:
(i) the amount of debt service to be paid on the bonds
for which the reservation is sought; or
(ii) the amount of debt service attributable to any
debt that is no longer outstanding at the application deadline, provided
that the Texas Education Agency (TEA) has sufficient evidence of the
discharge or defeasance of such debt.
(C) Solely for the purpose of this calculation, the
debt service amounts for variable rate bonds will be those that are
published in the final official statement, or if there is no official
statement, debt service amounts based on the maximum rate permitted
by the bond order or other bond proceeding that establishes a maximum
interest rate for the bonds.
(2) Application deadline--the last business day of
the month in which an application for a guarantee is filed. Applications
must be submitted electronically through the website of the MAC of
Texas or its successor by 5:00 p.m. on the last business day of the
month to be considered in that month's application processing.
(3) Average daily attendance (ADA)--total refined average
daily attendance as defined by TEC, §42.005.
(4) Bond--a debt security issuance approved by the
attorney general, issued under TEC, §45.003 or §45.004,
to provide long-term financing with a maturity schedule of at least
three years.
(5) Bond Guarantee Program (BGP)--the guarantee program
that is described by this section and established under TEC, Chapter
45, Subchapter C.
(6) Bond order--the order adopted by the governing
body of a school district that authorizes the issuance of bonds and
the pricing certificate, if any, establishing the terms of the bonds
executed pursuant to such order.
(7) Combination issue--an issuance of bonds for which
an application for a guarantee is filed that includes both a new money
portion and a refunding portion, as permitted by the Texas Government
Code, Chapter 1207. The eligibility of combination issues for the
guarantee is limited by the eligibility of the new money and refunding
portions as defined in this subsection.
(8) Enrollment growth--growth in student enrollment,
as defined by §129.1025 of this title (relating to Adoption by
Reference: Student Attendance Accounting Handbook), that has occurred
over the previous five school years.
(9) Nationally recognized investment rating firm--an
investment rating firm that is designated by the United States Securities
and Exchange Commission as a nationally recognized statistical rating
organization (NRSRO) and is demonstrating that it has:
(A) had its current NRSRO designation for at least
three consecutive years;
(B) provided credit ratings to each of the following:
(i) fifteen or more fixed income securities denominated
in United States dollars and issued during the immediately preceding
three years; and
(ii) ten or more school districts in the United States;
and
(C) a documented separation of duties between employees
involved in credit analysis and employees involved in business relationships
with clients.
(10) New money issue--an issuance of bonds for the
purposes of constructing, renovating, acquiring, and equipping school
buildings; the purchase of property; or the purchase of school buses.
An issuance of bonds for the purpose of constructing teacher or student
housing is eligible for the guarantee for new money only if it is
an integral part of the educational mission of the school district
as determined by the commissioner. Eligibility for the guarantee for
new money issues is limited to the issuance of bonds authorized under
TEC, §45.003. A new money issue does not include the issuance
of bonds to purchase a facility from a public facility corporation
created by the school district or to purchase any property that is
currently under a lease-purchase contract under the Local Government
Code, Chapter 271, Subchapter A. A new money issue does not include
an issuance of bonds to refinance any type of maintenance tax-supported
debt. Maintenance tax-supported debt includes, but is not limited
to:
(A) time warrants or loans entered under TEC, Chapter
45, Subchapter E; or
(B) any other type of loan or warrant that is not supported
by bond taxes as defined by TEC, §45.003.
(11) Notes issued to provide interim financing--an
issuance of notes, including commercial paper notes, designed to provide
short-term financing for the purposes of constructing, renovating,
acquiring, and equipping school buildings; the purchase of property;
or the purchase of school buses. For notes to be eligible for the
guarantee under this section, the notes must be:
(A) issued to pay costs for which bonds have been authorized
at an election occurring before the issuance of the notes;
(B) approved by the attorney general or issued in accordance
with proceedings that have been approved by the attorney general;
and
(C) refunded by bonds issued to provide long-term financing
no more than three years from the date of issuance of such notes,
provided that the date of issuance of notes will be determined by
reference to the date on which the notes were issued for capital expenditures
and the intervening date or dates of issuance of any notes issued
to refinance outstanding notes will be disregarded.
(12) Refunding issue--an issuance of bonds for the
purpose of refunding bonds, including notes issued to provide interim
financing, that are supported by bond taxes as defined by TEC, §45.003.
Eligibility for the guarantee for refunding issues is limited to refunding
issues that refund bonds, including notes issued to provide interim
financing, that were authorized by a bond election under TEC, §45.003.
(13) Total debt service--total outstanding principal
and interest on bonded debt.
(A) The total debt service will be determined by the
current report of the bonded indebtedness of the district as reported
by the MAC of Texas or its successor as of the date of the application
deadline, if the district has outstanding bonded indebtedness.
(B) The total debt service does not include:
(i) the amount of debt service to be paid on the bonds
for which the reservation is sought; or
(ii) the amount of debt service attributable to any
debt that is no longer outstanding at the application deadline, provided
that TEA has sufficient evidence of the discharge or defeasance of
such debt.
(C) Solely for the purpose of this calculation, the
debt service amounts for variable rate bonds will be those that are
published in the final official statement, or if there is no official
statement, debt service amounts based on the maximum rate permitted
by the bond order or other bond proceeding that establishes a maximum
interest rate for the bonds.
(c) Data sources.
(1) The following data sources will be used for purposes
of prioritization:
(A) projected ADA for the current school year as adopted
by the legislature for appropriations purposes;
(B) final property values certified by the comptroller
of public accounts, as described in the Texas Government Code, Chapter
403, Subchapter M, for the tax year preceding the year in which the
bonds will be issued. If final property values are unavailable, the
most recent projection of property values by the comptroller, as described
in the Texas Government Code, Chapter 403, Subchapter M, will be used;
(C) debt service information reported by the MAC of
Texas or its successor as of the date of the application deadline;
and
(D) enrollment information reported to the Public Education
Information Management System (PEIMS) for the five-year time period
ending in the year before the application date.
(2) The commissioner may consider adjustments to data
values determined to be erroneous or not reflective of current conditions
before the deadline for receipt of applications for that application
cycle.
(d) Bond eligibility.
Cont'd... |
