89R9895 AMF-D     By: Harrison H.B. No. 5035       A BILL TO BE ENTITLED   AN ACT   relating to a prohibition on the guarantee of public school bonds.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:   ARTICLE 1. GUARANTEE OF PUBLIC SCHOOL BONDS PROHIBITED          SECTION 1.001.  The heading to Subchapter C, Chapter 45,   Education Code, is amended to read as follows:   SUBCHAPTER C. GUARANTEE OF [GUARANTEED] BONDS PROHIBITED          SECTION 1.002.  Section 45.052, Education Code, is amended   to read as follows:          Sec. 45.052.  GUARANTEE OF BONDS PROHIBITED.  (a) Bonds [On   approval by the commissioner, bonds] issued under Subchapter A by a   school district or Chapter 53 for a charter district, including   refunding and refinanced bonds, may not be [are] guaranteed or   otherwise underwritten by the corpus and income of the permanent   school fund.          (b)  A [Notwithstanding any amendment of this subchapter or   other law, the] guarantee of or credit enhancement provided for a   [under this subchapter of] school district or charter district bond   approved before September 1, 2025, [bonds] remains in effect until   the date those bonds mature or are defeased in accordance with state   law.   ARTICLE 2. CONFORMING CHANGES          SECTION 2.001.  Section 12.141(c), Education Code, is   amended to read as follows:          (c)  The agency shall annually review the amount of funds in   the charter school liquidation fund and transfer any funds   exceeding $2 million[:                [(1)]  for use in funding a grant program established   by the agency to:                (1) [(A)]  encourage high school students to enter the   teaching profession; and                (2) [(B)]  assist current paraprofessionals and   instructional aides in pursuing the necessary credentials to become   full-time teachers[; or                [(2)  to the comptroller to deposit in the charter   district bond guarantee reserve fund under Section 45.0571].          SECTION 2.002.  Section 43.052(a), Education Code, is   amended to read as follows:          (a)  The State Board of Education may incorporate the Texas   Permanent School Fund Corporation and delegate to the corporation   the board's authority to manage and invest[:                [(1)]  the permanent school fund under Section 43.003[;   and                [(2)  the charter district bond guarantee reserve fund   under Section 45.0571].          SECTION 2.003.  Section 45.051(1-a), Education Code, is   amended to read as follows:                (1-a)  "Charter district" means an open-enrollment   charter school designated as a charter district under Section   12.135 as that section existed immediately before September 1,   2025.          SECTION 2.004.  Section 53.02(10), Education Code, is   amended to read as follows:                (10)  "Authorized charter school" means an   open-enrollment charter school that holds a charter granted under   Subchapter D, Chapter 12[, and includes an open-enrollment charter   school designated as a charter district as provided by Section   12.135].          SECTION 2.005.  Section 1201.0245(i), Government Code, is   amended to read as follows:          (i)  A political subdivision may extend the maturity date of   an issued capital appreciation bond only if:                (1)  the extension of the maturity date will decrease   the total amount of projected principal and interest to maturity;   or                (2)  the political subdivision is a school district and   [:                      [(A)]  the maximum legally allowable tax rate for   indebtedness has been adopted[; and                      [(B)  the Texas Education Agency certifies in   writing that the solvency of the permanent school fund's bond   guarantee program would be threatened without the extension].          SECTION 2.006.  The following provisions of the Education   Code are repealed:                (1)  Section 7.055(b)(38);                (2)  Section 7.102(c)(33);                (3)  Section 12.135;                (4)  Section 43.067;                (5)  Sections 45.051(1) and (2);                (6)  Sections 45.053, 45.0531, 45.0532, 45.0533,   45.054, 45.0541, 45.055, 45.056, 45.057, 45.0571, 45.058, 45.059,   45.0591, 45.060, 45.061, 45.062, and 45.063;                (7)  Subchapter I, Chapter 45;                (8)  Section 48.273(g); and                (9)  Section 53.351(f-1).   ARTICLE 3. TRANSITION; EFFECTIVE DATE          SECTION 3.001.  The change in law made by this Act applies   only to a guarantee of or credit enhancement provided for a school   district or charter district bond approved on or after the   effective date of this Act.  A guarantee of or credit enhancement   provided for a school district or charter district bond approved   before the effective date of this Act remains in effect until the   date those bonds mature or are defeased in accordance with state   law, and the former law is continued for that purpose.          SECTION 3.002.  This Act takes effect September 1, 2025.