Texas Administrative Code › Title 19 - EDUCATION › Part 2 - TEXAS EDUCATION AGENCY › Chapter 61 - SCHOOL DISTRICTS › Subchapter CC - COMMISSIONER'S RULES CONCERNING SCHOOL FACILITIES › Section 61.1038 - School District Bond Enhancement Program

Current through Reg. 49, No. 28; July 12, 2024
(a) Statutory provision. The commissioner of
				  education must administer the intercept credit enhancement program for school
				  district bonds according to the provisions of the Texas Education Code (TEC),
				  Chapter 45, Subchapter I.
(b)
				  Definitions. The following definitions apply to the intercept credit
				  enhancement program for school district bonds.
(1) Application deadline--The last business
				  day of the month in which an application for a credit enhancement is filed.
				  Applications must be received by the Texas Education Agency (TEA) division
				  responsible for state funding by 5:00 p.m. on the last business day of the
				  month to be considered in that month's application processing.
(2) Average daily attendance (ADA)--Total
				  refined average daily attendance as defined by the TEC, §
											48.005.
(3) Bond order--The order adopted by the
				  governing body of a school district that authorizes the issuance of
				  bonds.
(4) Combination issue--An
				  issuance of bonds for which an application is filed for a credit enhancement
				  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 credit enhancement is limited by the eligibility of the new money and
				  refunding portions as defined in this subsection.
(5) 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.
(6) Financial exigency--A determination by a
				  school district board of trustees that the financial condition of the district
				  requires a reduction in personnel, as authorized by the TEC, §
											21.211.
(7) Foundation School Program (FSP)--The
				  program established under the TEC, Chapters 46, 48, and 49, or any successor
				  program of state-appropriated funding for school districts in this
				  state.
(8) 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. Eligibility for the credit enhancement for new money issues is limited
				  to the issuance of bonds authorized under the 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 the
				  TEC, Chapter 45, Subchapter E; or
(B) any other type of loan or warrant that is
				  not supported by bond taxes as defined by the TEC, §
												45.003.
(9) 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
				  credit enhancement 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 Office
				  of the Attorney General or issued in accordance with proceedings that have been
				  approved the Office of 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.
(10) Proposed annual debt service--Payments
				  of principal and interest on the outstanding bonded debt for which the
				  enhancement is sought scheduled to occur between September 1 and August 31
				  during the fiscal year in which the credit enhancement is sought and each
				  fiscal year for which the credit enhancement is or would be in effect as
				  described in the amortization schedule for the bonded debt for which the
				  enhancement is sought.
(11)
				  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 the TEC, §
											45.003. Eligibility
				  for the credit enhancement 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 the TEC, §
											45.003.
(12) School District Bond Enhancement Program
				  (SDBEP)--The intercept program to provide credit enhancement for school
				  district bonds that is described by this section and established under the TEC,
				  Chapter 45, Subchapter I.
(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 credit enhancement 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 TEA has sufficient evidence of the discharge or defeasance of such
				  debt.
(C) The debt
				  service amounts used in this calculation for variable rate bonds will be those
				  that are published in the final official statement or final maturity
				  schedule.