| (5) Reapplication. If a district does not receive approval
for the guarantee or for any reason does not receive approval of the
bonds from the attorney general within the time period specified in
subsection (g)(4) of this section, the district may reapply in a subsequent
month. Applications that were denied approval for the guarantee will
not be retained for consideration in subsequent months.
(g) Approval for the guarantee; district responsibilities
on receipt of approval.
(1) Initial and final approval provisions.
(A) If, during the monthly estimation of PSF capacity
described in subsection (e)(1) of this section, the commissioner determines
that the available capacity of the PSF is 10% or less, the commissioner
may require an applicant school district to obtain final approval
for the guarantee as described in paragraph (3) of this subsection.
(B) If the commissioner has not made such a determination:
(i) the commissioner will consider the initial approval
described in paragraph (2) of this subsection as both the initial
and final approval; and
(ii) an applicant school district that has received
notification of initial approval for the guarantee, as described in
paragraph (2) of this subsection, may consider that notification as
notification of initial and final approval for the guarantee and may
complete the sale of the applicable bonds.
(2) Initial approval.
(A) The following provisions apply to all applications
for the guarantee, regardless of whether an application is for a new
money, refunding, or combination issue. Under TEC, §45.056, the
commissioner will investigate the applicant school district's accreditation
status and financial status. A district must be accredited and financially
sound to be eligible for initial approval by the commissioner. The
commissioner's review will include the following:
(i) the purpose of the bond issue;
(ii) the district's accreditation status as defined
by §97.1055 of this title (relating to Accreditation Status)
in accordance with the following:
(I) if the district's accreditation status is Accredited,
the district will be eligible for consideration for the guarantee;
(II) if the district's accreditation status is Accredited-Warned
or Accredited-Probation, the commissioner will investigate the underlying
reason for the accreditation rating to determine whether the accreditation
rating is related to the district's financial soundness. If the accreditation
rating is related to the district's financial soundness, the district
will not be eligible for consideration for the guarantee; or
(III) if the district's accreditation status is Not
Accredited-Revoked, the district will not be eligible for consideration
for the guarantee;
(iii) the district's compliance with statutes and rules
of TEA; and
(iv) the district's financial status and stability,
regardless of the district's accreditation rating, including approval
of the bonds by the attorney general under the provisions of TEC, §45.0031
and §45.005.
(B) The following limitation applies to applications
for new money issues of bonds for which the election authorizing the
issuance of the bonds was called after July 15, 2004. The commissioner
will limit approval for the guarantee to a district that has, at the
time of the application for the guarantee, less than 90% of the annual
debt service of the district with the highest annual debt service
per ADA, as determined by the commissioner annually, or less than
90% of the total debt service of the district with the highest total
debt service per ADA, as determined by the commissioner annually.
The limitation will not apply to school districts that have enrollment
growth, as defined in subsection (b)(8) of this section, of at least
25%, based on PEIMS data on enrollment available at the time of application.
The annual debt service amount is the amount defined by subsection
(b)(1) of this section. The total debt service amount is the amount
defined by subsection (b)(13) of this section.
(C) The commissioner will grant or deny initial approval
for the guarantee based on the review described in subparagraph (A)
of this paragraph and the limitation described in subparagraph (B)
of this paragraph and will provide an applicant district whose application
has received initial approval for the guarantee written notice of
initial approval.
(3) Final approval. The provisions of this paragraph
apply only as described in paragraph (1) of this subsection. A district
must receive final approval before completing the sale of the bonds
for which the district has received notification of initial approval.
(A) A district that has received initial approval must
provide a written notice to TEA two business days before issuing a
preliminary official statement (POS) for the bonds that are eligible
for the guarantee or two business days before soliciting investment
offers, if the bonds will be privately placed without the use of a
POS.
(i) The district must receive written confirmation
from TEA that the capacity continues to be available before proceeding
with the public or private offer to sell bonds.
(ii) TEA will provide this notification within one
business day of receiving the notice of the POS or notice of other
solicitation offers to sell the bonds.
(B) A district that received confirmation from TEA
in accordance with subparagraph (A) of this paragraph must provide
written notice to TEA of the placement of an item to approve the bond
sale on the agenda of a meeting of the school board of trustees no
later than two business days before the meeting. If the bond sale
is completed pursuant to a delegation by the board to a pricing officer
or committee, notice must be given to TEA no later than two business
days before the execution of a bond purchase agreement by such pricing
officer or committee.
(i) The district must receive written confirmation
from TEA that the capacity continues to be available for the bond
sale before the approval of the sale by the school board of trustees
or by the pricing officer or committee.
(ii) TEA will provide this notification within one
business day before the date that the district expects to complete
the sale by official action of the board or of a pricing officer or
committee.
(C) TEA will process requests for final approval from
districts that have received initial approval on a first come, first
served basis. Requests for final approval must be received before
the expiration of the initial approval.
(D) A district may provide written notification as
required by this paragraph by facsimile transmission or by email in
a manner prescribed by the commissioner.
(4) District responsibilities on receipt of approval.
(A) Once a district is awarded initial approval for
the guarantee, each issuance of the bonds must be approved by the
attorney general within 180 days of the date of the letter granting
the approval for the guarantee. The initial approval for the guarantee
will expire at the end of the 180-day period. The commissioner may
extend the 180-day period, based on extraordinary circumstances, on
receiving a written request from the district or the attorney general
before the expiration of the 180-day period.
(B) If the bonds are not approved by the attorney general
within 180 days of the date of the letter granting the approval for
the guarantee, the commissioner will consider the application withdrawn,
and the district must reapply for a guarantee.
(C) If applicable, the district must comply with the
provisions for final approval described in paragraph (3) of this subsection
to maintain approval for the guarantee.
(D) A district may not represent bonds as guaranteed
for the purpose of pricing or marketing the bonds before the date
of the letter granting approval for the guarantee.
(h) Financial exigency. The following provisions describe
how a declaration of financial exigency under §109.2001 of this
title (relating to Financial Exigency) affects a district's application
for guarantee approval or a district's previously granted approval.
(1) Application for guarantee of new money issue. The
commissioner will deny approval of an application for the guarantee
of a new money issue if the applicant school district has declared
a state of financial exigency for the district's current fiscal year.
The denial of approval will be in effect for the duration of the applicable
fiscal year unless the district can demonstrate financial stability.
(2) Approval granted before declaration. If in a given
district's fiscal year the commissioner grants approval for the guarantee
of a new money issue and the school district subsequently declares
a state of financial exigency for that same fiscal year, the district
must immediately notify the commissioner and may not offer the bonds
for sale unless the commissioner determines that the district may
proceed.
Cont'd... |
