The bill amends Chapter 1253 of the Government Code to clarify the authority of political subdivisions in Texas to issue public securities for the purchase or lease of tangible personal property and for improvements to real property. The heading of the chapter is changed to "PUBLIC SECURITIES ISSUED BY POLITICAL SUBDIVISIONS," and definitions are updated to include "public security" as defined in Section 1201.002. A new section, 1253.0015, is added to impose limitations on the issuance of public securities for tangible personal property, stating that a political subdivision cannot issue such securities if the expected useful life of the property ends before the maturity date of the security. However, this limitation does not apply to financing related to critical infrastructure facilities.

Additionally, Section 1253.002 is amended to specify that political subdivisions may not issue certain public securities, including certificates of obligation and anticipation notes, for improvements to real property if the weighted average maturity of the securities exceeds 120 percent of the reasonably expected weighted average economic life of the improvements. The bill aims to ensure responsible financial practices by political subdivisions when issuing public securities, thereby protecting public funds. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Government Code 1253.001, Government Code 1253.002 (Government Code 1253)
House Committee Report: Government Code 1253.001, Government Code 1253.002 (Government Code 1253)