The bill, H.B. No. 302, introduces a new provision to the Education Code that prohibits school districts from issuing certain bonds if specific financial conditions are met. Specifically, it adds Subsection (i) to Section 45.003, stating that a school district's governing body or commissioners court cannot order an election to authorize the issuance of bonds if the amount required to pay the principal and interest on existing bonds exceeds 18 percent of the district's most recently adopted or amended annual budget. Additionally, the proposed bond's principal and interest combined with the existing bonds must also not exceed this 18 percent threshold.

The bill clarifies that the new regulations will only apply to elections ordered after the effective date of the Act, which is set to take effect 91 days after the end of the legislative session. Elections ordered prior to this date will continue to be governed by the previous law. This change aims to ensure that school districts maintain a manageable level of debt relative to their budgets, promoting fiscal responsibility.

Statutes affected:
Introduced: Education Code 45.003 (Education Code 45)