Sec. 202.031. POWER TO BORROW MONEY

(a) Subject to the requirements of Subsection (b) of this section, a district may:

(1) borrow money for the corporate purposes of the district;

(2) pledge certificates, obligations, or securities held by the district as security for a loan; and

(3) pledge and assign revenue or income to secure repayment of a loan.

(b) An obligation, bond, warrant, debenture, or other evidence of indebtedness must:

(1) bear interest not to exceed five percent a year;

(2) mature within 10 years;

(3) be payable out of and secured by the revenue and income of the district; and

(4) not be paid out of money received from ad valorem taxes.

Acts 1981, 67th Leg., p. 1485, ch. 388, Sec. 1, eff. Sept. 1, 1981.