CHAPTER 6903. EASTLAND COUNTY WATER SUPPLY DISTRICT - Texas Statutes

SPECIAL DISTRICT LOCAL LAWS CODE

TITLE 6. WATER AND WASTEWATER

SUBTITLE B. FRESH WATER SUPPLY DISTRICTS

CHAPTER 6903. EASTLAND COUNTY WATER SUPPLY DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 6903.001. DEFINITIONS. In this chapter:

(1) "Board" means the board of directors of the district.

(2) "Commissioners court" means the Commissioners Court of

Eastland County.

(3) "Director" means a member of the board.

(4) "District" means the Eastland County Water Supply District.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.002. NATURE OF DISTRICT. The district is created

under Section 59, Article XVI, Texas Constitution.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.003. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) All

land in the district will benefit from the improvement to be

acquired and constructed by the district.

(b) The accomplishment of the purposes stated in this chapter is

for the benefit of the people of this state and for the

improvement of their property and industries. The district, in

carrying out the purposes of this chapter, will be performing an

essential public function under the Texas Constitution.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER B. DISTRICT TERRITORY AND ANNEXATIONS TO DISTRICT

TERRITORY

Sec. 6903.051. DISTRICT TERRITORY. The district is composed of

the territory in the city of Ranger on May 26, 1949, and the

territory in the city of Eastland that was added to the district

before June 8, 1953. The district's territory may have been

modified under:

(1) this subchapter or its predecessor statute, Section 5,

Chapter 465, Acts of the 51st Legislature, Regular Session, 1949;

(2) Subchapter J, Chapter 49, Water Code; or

(3) other law.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.052. AUTHORITY TO ANNEX TERRITORY. Territory, whether

contiguous to the district or not, and inside or outside Eastland

County, may be annexed to the district in the manner provided by

this subchapter.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.053. PETITION FOR ANNEXATION; BOARD FINDINGS AND

RESOLUTION. (a) The board may annex territory under this

subchapter if a petition requesting annexation is signed by 50

registered voters of the territory to be annexed who own taxable

property in that territory, or a majority of the registered

voters of that territory who own taxable property in that

territory, and is filed with the board. The petition must

describe the territory to be annexed by metes and bounds, or

otherwise, except that if the territory is the same as that

contained in a municipality, the petition is sufficient if it

states that the territory to be annexed is the territory

contained in the municipality.

(b) If the board determines that the petition complies with

Subsection (a), that the annexation would be in the interest of

the district, and that the district will be able to supply water

to the territory, the board shall adopt a resolution:

(1) stating the conditions, if any, under which the territory

may be annexed to the district; and

(2) requesting the commissioners court to annex the territory to

the district.

(c) A certified copy of the resolution and petition shall be

filed with the commissioners court.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.054. COMMISSIONERS COURT RESOLUTION; HEARING. The

commissioners court shall:

(1) adopt a resolution declaring its intention to call an

election in the territory to submit the proposition of whether

the territory is to be annexed to the district; and

(2) set a time and place to hold a commissioners court hearing

on the question of whether the territory to be annexed will

benefit from the improvements, works, and facilities then owned

or operated or contemplated to be owned or operated by the

district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.055. ANNEXATION HEARING. (a) At least 10 days before

the date of the annexation hearing, notice of the adoption of the

resolution stating the time and place of the hearing and

addressed to the citizens and owners of property in the territory

to be annexed shall be published one time in a newspaper

designated by the commissioners court. The notice must describe

the territory in the same manner in which Section 6903.053(a)

requires the petition to describe the territory.

(b) If a newspaper is not published in the territory to be

annexed, the notice shall be posted in three public places in the

territory.

(c) Any interested person may appear at the hearing and offer

evidence for or against the annexation.

(d) The hearing may proceed in the order and under the rules

prescribed by the commissioners court and may be recessed from

time to time.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.056. COMMISSIONERS COURT FINDINGS AND RESOLUTION;

ELECTION. If, at the conclusion of the annexation hearing, the

commissioners court finds that all land in the territory to be

annexed will benefit from the present or contemplated

improvements, works, or facilities of the district, the court

shall adopt a resolution that:

(1) calls an election in the territory to be annexed; and

(2) states the date of the election and the place or places of

holding the election.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.057. NOTICE OF ANNEXATION ELECTION. In addition to

complying with Section 4.004, Election Code, notice of the

annexation election must:

(1) state the conditions under which the territory may be

annexed; or

(2) refer to the resolution of the board for that purpose.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.058. ELECTION RESULTS. (a) The commissioners court

shall issue an order declaring the results of the annexation

election.

(b) If the order shows that a majority of the votes cast are in

favor of annexation, the commissioners court shall annex the

proposed territory to the district. The annexation is

incontestable except within the time for contesting elections

under the general election law.

(c) A certified copy of the order shall be recorded in the deed

records of the county in which the territory is located.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.059. ASSUMPTION OF DEBT; TAXES. (a) In calling the

election on the proposition for annexation of territory, the

commissioners court may include, as a part of the same

proposition, a proposition for:

(1) the territory to assume its part of the tax-supported bonds

of the district then outstanding and those bonds previously voted

but not yet sold; and

(2) an ad valorem tax to be imposed on taxable property in the

territory along with the tax in the rest of the district for the

payment of the bonds.

(b) After territory is annexed to the district, the board may

hold an election in the district as enlarged to determine whether

the district as enlarged shall assume any tax-supported bonds

then outstanding and those previously voted but not yet sold and

impose an ad valorem tax on all taxable property in the district

as enlarged to pay the bonds, unless the proposition is submitted

as provided by Subsection (a) and becomes binding on the

territory annexed.

(c) An election held under Subsection (b) shall be held in the

same manner as an election under this chapter for the issuance of

bonds.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.060. RESTRICTION ON ANNEXATION OF RAILROAD

RIGHT-OF-WAY. (a) A railroad right-of-way may not be annexed to

the district unless the right-of-way is contained in the limits

of a municipality annexed at the same time or previously annexed

to the district.

(b) A railroad right-of-way that is not in the defined limits of

a municipality will not benefit from improvements, works, and

facilities the district is authorized to construct.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER C. BOARD OF DIRECTORS

Sec. 6903.101. COMPOSITION OF BOARD; TERMS. (a) The board

consists of eight directors.

(b) Voters of the city of Ranger who reside in the district

elect four directors. Voters of the city of Eastland who reside

in the district elect four directors.

(c) Directors serve staggered terms, with the terms of two

directors elected from each city expiring at the same time.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.102. QUALIFICATIONS FOR OFFICE. (a) A director must

reside in the municipality from which elected and own taxable

property in the district.

(b) A member of a municipality's governing body or an employee

of a municipality may not be a director.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.103. LOCATION AND NOTICE FOR DIRECTORS ELECTION;

RESULTS. (a) For a regular directors election, there shall be

at least one voting place in each municipality in the district.

(b) Notice of a directors election shall be published in a

newspaper published in each municipality in the district one time

not later than the 10th day before the date of the election.

(c) The board shall adopt a resolution declaring the election

results.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.104. BALLOT PROCEDURE FOR CANDIDATES. (a) A person

who wants to have the person's name printed on the ballot as a

candidate for director must present a petition requesting that

action.

(b) The petition must be:

(1) signed by at least 50 residents of the district who are

registered to vote at the election; and

(2) presented to the board's secretary not later than the 16th

day before the date of the election.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.105. APPOINTMENT OF SECRETARY AND TREASURER. The

board shall appoint a secretary and a treasurer, who are not

required to be directors. The board may combine the offices of

secretary and treasurer.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.106. VOTE BY BOARD PRESIDENT. The president has the

same right to vote as any other director.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.107. DIRECTOR'S AND TREASURER'S BOND. (a) Each

director shall give bond in the amount of $5,000 conditioned on

the faithful performance of the director's duties.

(b) The treasurer shall give bond in the amount required by the

board. The treasurer's bond shall be conditioned on the

treasurer's faithful accounting for all money that comes into the

treasurer's custody as treasurer of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.108. COMPENSATION. Unless the board by resolution

increases the fee to an amount authorized by Section 49.060,

Water Code, each director:

(1) shall receive a fee of $5 for attending each board meeting;

and

(2) is also entitled to receive $5 for each day devoted to the

business of the district if the service is expressly approved by

the board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER D. GENERAL POWERS AND DUTIES

Sec. 6903.151. CONSTRUCTION OF DAM. (a) The district may

impound storm and flood waters and the unappropriated flow waters

at one or more places and in an amount approved by the Texas

Commission on Environmental Quality by constructing one or more

dams inside or outside the district. In exercising its powers

under this subsection, the district shall comply with Subchapters

A-D, Chapter 11, and Subchapter B, Chapter 12, Water Code.

(b) A dam or other works for the impounding of water from a

river under this section may not be constructed until the plans

for the dam or other works are approved by the Texas Commission

on Environmental Quality.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.152. UNDERGROUND SOURCES OF WATER. The district may

develop or otherwise acquire underground sources of water.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.153. CONSTRUCTION OR ACQUISITION OF PROPERTY. The

district may construct or otherwise acquire all works, plants,

and other facilities necessary or useful for the purpose of

processing water impounded, developed, or otherwise acquired and

transporting it to municipalities and others for municipal,

domestic, and industrial purposes.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.154. WATER APPROPRIATION PERMITS. The district may

acquire water appropriation permits directly from the Texas

Commission on Environmental Quality or from owners of permits.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.155. PURCHASE OF WATER. The district may purchase

water or a water supply from any person, including a public

agency.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.156. SURPLUS PROPERTY. The district may sell any

property that, in the opinion of the board, will not be needed

for the conduct of the affairs or business of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.157. EMINENT DOMAIN. (a) To carry out a power

provided by this chapter, the district may exercise the power of

eminent domain to acquire land and easements inside or outside

the district, including land above the probable high water line

around the reservoirs.

(b) The district must exercise the power of eminent domain in

the manner provided by Chapter 21, Property Code.

(c) The board shall determine the amount and the type of

interest in land and easements to be acquired under this section.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.158. PARKS AND RECREATION FACILITIES. (a) The

district may establish or otherwise provide for public parks and

recreation facilities and may acquire land adjacent to any of its

reservoirs for those purposes.

(b) The district may not use money received from taxation or

from bonds payable wholly or partly from taxation for a purpose

described by Subsection (a).

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.159. CONSTRUCTION CONTRACTS. (a) This section

applies only to a construction contract or a contract for the

purchase of material, equipment, or supplies requiring an

expenditure of more than $25,000.

(b) The district shall award a contract to the lowest and best

bidder after publishing notice to bidders once a week for two

weeks in a newspaper published in the district that is designated

by the board.

(c) The notice is sufficient if it states:

(1) the time and place for opening the bids;

(2) the general nature of the work to be done or the material,

equipment, or supplies to be purchased; and

(3) the place where and the terms on which copies of the plans

and specifications may be obtained.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.160. CONTRACTS TO SUPPLY WATER. (a) The district may

contract with municipalities and others to supply water to those

entities.

(b) The district may contract with a municipality for the rental

or leasing of or for the operation of the water production, water

supply, and water supply facilities of the municipality on the

consideration agreed to by the district and the municipality.

(c) The contract may be on terms and for the time agreed to by

the parties.

(d) The contract may provide that it will continue in effect

until bonds specified in it and refunding bonds issued in lieu of

the bonds are paid.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.161. CONTRACTS FOR TOLL BRIDGES OR FERRY SERVICE. (a)

The board may contract with a responsible person for:

(1) the construction and operation of a toll bridge over the

district's water; or

(2) ferry service on or over the district's water.

(b) The period of a contract under Subsection (a) may not

exceed:

(1) 20 years under Subsection (a)(1); or

(2) 10 years under Subsection (a)(2).

(c) The contract under Subsection (a) may:

(1) set reasonable compensation to be charged for service by the

facility;

(2) require from the contracting person an adequate bond payable

to the district in an amount and conditioned as the board

considers to be required; and

(3) provide for forfeiture of the particular franchise if the

license holder fails to render adequate public service.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER E. REGULATORY POWERS

Sec. 6903.201. ADOPTION OF RULES. The board may adopt

reasonable rules to:

(1) secure, maintain, and preserve the sanitary condition of

water in and water that flows into any reservoir owned by the

district;

(2) prevent waste of or the unauthorized use of water; and

(3) regulate residence, hunting, fishing, boating, camping, and

any other recreational or business privilege along or around any

district reservoir and the stream leading into the reservoir, and

its tributaries, or any body of land, or easement owned or

controlled by the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.202. ENFORCEMENT OF RULES; PENALTY. (a) The district

by rule may prescribe reasonable penalties for the violation of a

district rule.

(b) A penalty may consist of:

(1) a fine not to exceed $200;

(2) confinement in jail for a term not to exceed 30 days; or

(3) both the fine and confinement.

(c) A penalty adopted under this section is in addition to any

other penalty provided by Texas law.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.203. NOTICE OF RULE PROVIDING PENALTY. (a) If the

district adopts a rule that provides a penalty, the district must

publish a substantive statement of the rule and the penalty once

a week for two consecutive weeks in Eastland County.

(b) The statement must be as condensed as possible so that the

act prohibited by the rule can be easily understood.

(c) The statement may include notice of any number of rules.

(d) The notice must state that:

(1) a person who violates the rule is subject to a penalty; and

(2) the rule is on file in the principal office of the district,

where it may be read by any interested person.

(e) A rule takes effect five days after the date of the second

publication of the statement under this section.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.204. JUDICIAL NOTICE OF RULES. A court shall take

judicial notice of a rule adopted under this subchapter and

published as required by Section 6903.203, and the court shall

consider the rule to be similar in nature to a penal ordinance of

a municipality.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.205. ENFORCEMENT BY PEACE OFFICERS. (a) A peace

officer employed by the district or a county peace officer may

make an arrest when necessary to prevent or abate the commission

of an offense:

(1) in violation of a district rule or a law of this state that

occurs or threatens to occur on any land, water, or easement

owned or controlled by the district; or

(2) involving damage to any property owned or controlled by the

district.

(b) A peace officer described by Subsection (a) may make an

arrest under Subsection (a)(2) at any location.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER F. GENERAL FINANCIAL PROVISIONS

Sec. 6903.251. DEPOSITORY. (a) Except as provided by

Subsection (i), the board shall designate one or more banks in

the district to serve as depository for the district's money.

(b) District money shall be deposited with a designated

depository bank or banks, except that:

(1) money pledged to pay bonds may be deposited with the trustee

bank named in the trust agreement; and

(2) money shall be remitted to the bank of payment for the

payment of principal of and interest on bonds.

(c) To the extent that money in a depository bank or a trustee

bank is not insured by the Federal Deposit Insurance Corporation,

the money must be secured in the manner provided by law for the

security of county funds.

(d) The board shall prescribe the terms of service for

depositories.

(e) Before designating a depository bank, the board shall issue

a notice that:

(1) states the time and place at which the board will meet to

designate a depository bank or banks; and

(2) invites the banks in the district to submit an application

to be designated as a depository.

(f) The notice must be published one time in a newspaper

published in the district and specified by the board.

(g) At the time stated in the notice, the board shall:

(1) consider the application and the management and condition of

each bank that applies; and

(2) designate as a depository the bank or banks that:

(A) offer the most favorable terms for handling the money; and

(B) the board finds have proper management and are in condition

to handle the money.

(h) Membership on the board of an officer or director of a bank

does not disqualify the bank from being designated as a

depository.

(i) If the board does not receive any applications before the

time stated in the notice, or if the board rejects all

applications, the board shall designate one or more banks located

inside or outside the district on terms that the board finds

advantageous to the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.252. TAX ASSESSOR AND COLLECTOR. The board shall

appoint a tax assessor and collector.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.253. PROJECTS EXEMPT FROM ASSESSMENT OR TAXATION. The

district is not required to pay a tax or assessment on a project

or any part of a project.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

SUBCHAPTER G. BONDS

Sec. 6903.301. AUTHORITY TO ISSUE BONDS. (a) The district may

issue bonds to:

(1) provide a source of water supply for municipalities and

other users for municipal, domestic, and industrial purposes; or

(2) carry out any other power conferred by this chapter.

(b) The bonds must be authorized by a board resolution.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.302. FORM OF BONDS. District bonds must be:

(1) issued in the district's name;

(2) signed by the president or vice president; and

(3) attested by the secretary.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.303. MATURITY. District bonds must mature not later

than 40 years after the date of their issuance.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.304. ELECTION FOR BONDS PAYABLE FROM AD VALOREM TAXES.

(a) Bonds, other than refunding bonds, payable wholly or partly

from ad valorem taxes may not be issued unless authorized by a

district election at which a majority of the votes cast in each

municipality in the district favor the bond issuance.

(b) The board may order an election under this section without a

petition. The order must specify:

(1) the time and places at which the election will be held;

(2) the purpose for which the bonds will be issued;

(3) the maximum amount of the bonds;

(4) the maximum maturity of the bonds;

(5) the form of the ballot; and

(6) the presiding judge for each voting place.

(c) Notice of the election must be given by publishing a

substantial copy of the order calling the election in a newspaper

published in the district for two consecutive weeks. The first

publication must be not later than the 21st day before the date

of the election.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.305. BONDS PAYABLE FROM REVENUE. (a) In this

section, "net revenue" means the gross revenue of the district

less the amount necessary to pay the cost of maintaining and

operating the district and its property.

(b) Bonds issued under this subchapter may be secured under

board resolution by a pledge of:

(1) all or part of the district's net revenue;

(2) the net revenue of one or more contracts made before or

after the issuance of the bonds; or

(3) other revenue specified by board resolution.

(c) The pledge may reserve the right to issue additional bonds

on a parity with or subordinate to the bonds being issued,

subject to conditions specified by the pledge.

(d) Bonds not payable wholly or partly from ad valorem taxes may

be issued without an election.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.306. BONDS PAYABLE FROM AD VALOREM TAXES. The

district may issue bonds payable from:

(1) ad valorem taxes imposed on taxable property in the

district; or

(2) ad valorem taxes and revenue of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.307. TAX AND RATE REQUIREMENTS. (a) If the district

issues bonds payable wholly or partly from ad valorem taxes, the

board shall impose a tax sufficient to pay the bonds and the

interest on the bonds as the bonds and interest become due. The

board may adopt the rate of the tax after considering the money

received from the pledged revenue available for payment of

principal and interest to the extent and in the manner permitted

by the resolution authorizing the issuance of the bonds.

(b) If the district issues bonds payable wholly or partly from

revenue, the board shall set and revise the rates of compensation

for water sold and services rendered by the district.

(c) For bonds payable wholly from revenue, the rates of

compensation must be sufficient to:

(1) pay the expense of operating and maintaining the facilities

of the district;

(2) pay the bonds as they mature and the interest as it accrues;

and

(3) maintain the reserve and other funds as provided by the

resolution authorizing the issuance of the bonds.

(d) For bonds payable partly from revenue, the rates of

compensation must be sufficient to assure compliance with the

resolution authorizing the issuance of the bonds.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.308. ADDITIONAL SECURITY. (a) Bonds, including

refunding bonds, authorized by this subchapter that are not

payable wholly from ad valorem taxes may be additionally secured

by a deed of trust lien on physical property of the district and

all franchises, easements, water rights and appropriation

permits, leases, contracts, and all rights appurtenant to the

property, vesting in the trustee power to:

(1) sell the property for payment of the debt;

(2) operate the property; and

(3) take other action to further secure the bonds.

(b) The deed of trust may:

(1) contain any provision the board prescribes to secure the

bonds and preserve the trust estate;

(2) provide for amendment or modification of the deed of trust;

and

(3) provide for the issuance of bonds to replace lost or

mutilated bonds.

(c) A purchaser under a sale under the deed of trust:

(1) is the owner of the dam or dams and the other property,

including facilities, purchased; and

(2) is entitled to maintain and operate the property, including

facilities.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.309. USE OF BOND PROCEEDS. (a) The district may set

aside an amount of proceeds from the sale of bonds issued under

this subchapter for the payment of interest expected to accrue

during construction and a reserve interest and sinking fund. The

resolution authorizing the bonds may provide for setting aside

and using the proceeds.

(b) The district may use proceeds from the sale of the bonds to

pay any expense necessarily incurred in accomplishing the

purposes of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.310. APPOINTMENT OF RECEIVER. (a) On default or

threatened default in the payment of principal of or interest on

bonds issued under this subchapter that are payable wholly or

partly from revenue, a court may, on petition of the holders of

25 percent of the outstanding bonds of the issue in default or

threatened with default, appoint a receiver for the district.

(b) The receiver may collect and receive all district income

except taxes, employ and discharge district agents and employees,

take charge of money on hand, except money received from taxes,

unless commingled, and manage the district's proprietary affairs

without consent or hindrance by the board.

(c) The receiver may be authorized to sell or contract for the

sale of water or to renew those contracts with the approval of

the court that appointed the receiver.

(d) The court may vest the receiver with any other power or duty

the court finds necessary to protect the bondholders.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.311. REFUNDING BONDS. (a) The district may issue

refunding bonds to refund outstanding bonds issued under this

subchapter and interest on those bonds.

(b) Refunding bonds may:

(1) be issued to refund bonds of more than one series;

(2) combine the pledges for the outstanding bonds for the

security of the refunding bonds; or

(3) be secured by a pledge of other or additional revenue.

(c) The provisions of this subchapter regarding the issuance of

other bonds and the remedies of the holders apply to refunding

bonds.

(d) The comptroller shall register the refunding bonds on

surrender and cancellation of the bonds to be refunded.

(e) Instead of issuing bonds to be registered on the surrender

and cancellation of the bonds to be refunded, the district, in

the resolution authorizing the issuance of the refunding bonds,

may provide for the sale of the refunding bonds and the deposit

of the proceeds in a bank at which the bonds to be refunded are

payable. In that case, the refunding bonds may be issued in an

amount sufficient to pay the interest on the bonds to be refunded

to their option date or maturity date, and the comptroller shall

register the refunding bonds without the surrender and

cancellation of the bonds to be refunded.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.

Sec. 6903.312. BONDS EXEMPT FROM TAXATION. A bond issued under

this subchapter, the transfer of the bond, and income from the

bond, including profits made on the sale of the bond, are exempt

from taxation in this state.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.06, eff. April 1, 2009.