A district may issue bond anticipation notes (BANs) for any
purpose for which bonds of the district may be issued or for the purpose
of refunding previously issued BANs. All BANs issued by a district
shall conform to the following requirements.
(1) A bond application containing all projects to be
financed by the BAN and the principal of and interest on the BAN shall
be on file with the commission.
(2) The financial advisor of the district renders a
written opinion to the district to the effect that, based on the projections
contained in the bond application report, the district can be reasonably
expected to sell its bonds, under prevailing market conditions existing
at the time of the sale of the BAN, in a principal amount at least
sufficient to redeem and pay the principal of, and accrued interest
on, the BAN on or prior to their stated maturity date.
(3) The proceeds of the BAN may be used to pay only
the district's allowable share of the costs of facilities as provided
in §293.47 of this title (relating to Thirty Percent of District
Construction Costs to be Paid by Developer) until the commission has
unconditionally determined that the district is exempt from developer
(4) The interest rate on the BAN shall be limited to
the maximum rate at which the district could have issued bonds on
the date of issuance of the BAN pursuant to applicable statute or
valid city consent.
(5) All BANs shall be sold at par.
(6) The proceedings authorizing the issuance of the
BAN shall provide that the BAN shall be redeemed at not more than
its par value within 30 days after receipt of proceeds from bonds
issued for the purpose of redeeming the BAN.
(7) No district funds shall be used to purchase bond
or BAN insurance, collateral guarantees, letters of credit, or other
forms of credit enhancement.
(8) No BAN proceeds shall be used for the purpose of
paying allowable developer interest, as provided in §293.50 of
this title (relating to Developer Interest Reimbursement).
(9) Except as hereinafter otherwise provided, BANs
shall not be used to finance facilities unless the plans and specifications
therefor have been approved by all regulatory authorities having jurisdiction
thereof and such plans and specifications have been submitted to the
executive director in connection with the district's pending bond
(10) Issuance of BANs shall not prejudice the right
of the commission to refuse to approve all or any portion of a bond
application or any cost or facility contained therein.
(11) BANs shall be payable solely from the proceeds
of the district's bonds, as approved by the commission, and no other
district funds shall be encumbered, pledged, committed or used for
(12) Prior to the issuance of the BAN, the developer
shall provide the district a letter of credit, irrevocable development
loan commitment, or other guarantee for the applicable contribution
of construction and engineering costs for each project to be financed
with BAN proceeds as required by §293.47(h) of this title.
(13) Prior to the issuance of the BANs, the developer
and district shall enter into a street and road construction agreement
as required by §293.48 of this title (relating to Street and
Water, Wastewater and Drainage Utility (Street and Utility) Construction
by Developer), unless exempted or inapplicable pursuant to §293.59(k)(11)
of this title (relating to Economic Feasibility of Project).
|Source Note: The provisions of this §293.54 adopted to be effective September 5, 1986, 11 TexReg 3736; amended to be effective June 5, 1998, 23 TexReg 5715; amended to be effective September 14, 2000, 25 TexReg 8955; amended to be effective November 13, 2014, 39 TexReg 8730