The bill amends the Government Code and Local Government Code regarding the issuance of anticipation notes and certificates of obligation by governing bodies of issuers. A new provision is added to Section 1431.002, stating that an issuer may not authorize an anticipation note to pay a contractual obligation if a bond proposition for the same purpose was submitted to voters in the past five years and was not approved. However, exceptions are made for specific circumstances, including cases related to natural disasters, compliance with federal court orders, and adherence to state or federal laws following official notification of noncompliance.

Additionally, Section 1431.003(b) is amended to clarify that the governing body may exercise authority regarding the issuance of obligations, with the exception of the prohibition on repayment with ad valorem taxes. In Section 271.047(d), the timeframe for bond propositions is extended from three to five years, and the language is updated to reflect the new provisions. The changes will apply only to anticipation notes or certificates of obligation authorized after the effective date of the Act, which is set for September 1, 2025.

Statutes affected:
Introduced: Government Code 1431.002, Government Code 1431.003, Local Government Code 271.047 (Government Code 1431, Local Government Code 271)