Texas Administrative Code › Title 30 - ENVIRONMENTAL QUALITY › Part 1 - TEXAS COMMISSION ON ENVIRONMENTAL QUALITY › Chapter 293 - WATER DISTRICTS › Subchapter E - ISSUANCE OF BONDS › Section 293.54 - Bond Anticipation Notes (BANs)

Current through Reg. 49, No. 28; July 12, 2024
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 participation.
(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
				  application.
(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 such purpose.
(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).