The bill, S.B. No. 2519, introduces new restrictions on the use of ad valorem tax revenue for the payment of public securities. It amends Section 26.07 of the Tax Code by adding a new subsection (h), which states that any increase in a taxing unit's maintenance and operations tax revenue from an election cannot be used or transferred to a local government corporation for repaying public securities. Additionally, the bill modifies the heading of Chapter 1253 in the Government Code to reflect a focus on "Public Securities" rather than "General Obligation Bonds."

Furthermore, the bill adds Section 1253.004 to the Government Code, which establishes limitations on the authority of municipalities, counties, or local government corporations to use ad valorem tax revenue for public securities. Specifically, it prohibits the dedication, pledge, or use of revenue derived from ad valorem taxes for public security payments, including any revenue transferred to local government corporations for this purpose. The provisions of this section apply only to public securities issued on or after the effective date of the Act. The bill is set to take effect immediately upon receiving a two-thirds vote from both houses or on September 1, 2025, if that vote is not achieved.

Statutes affected:
Introduced: Tax Code 26.012, Tax Code 26.05, Tax Code 26.07 (Tax Code 26)
Senate Committee Report: Tax Code 26.012, Tax Code 26.05, Tax Code 26.07 (Tax Code 26)
Engrossed: Tax Code 26.07 (Tax Code 26)
House Committee Report: Tax Code 26.07 (Tax Code 26)