Beginning in 2024, school districts must provide information regarding bond projects to the Texas Attorney General's office who will now determine if Section 45.003(g),TEC’s requirements have been satisfied with respect to special facilities. This is a very different standard than has been applied in the past.
Because the Texas Attorney General’s Office (the “Texas AG”) must approve most bond issues, the Texas AG has significant authority over the interpretation and implementation of the many laws that impact bond issues. On December 29,2023, the Texas AG released an All Bond Counsel Letter (the “ABC Letter”) that has important implications for school bond elections. Important takeaways from the ABC Letter include the following:
Since Section 45.003(g), TEC took effect, the Texas AG has generally relied upon school district certifications to ensure compliance with this statute. Essentially, the Texas AG has deferred to school districts on their interpretation of this statute. The ABC Letter marks a sea change in this regard. School districts must now provide information regarding bond projects to the Texas AG so that the Texas AG can make its own assessment as to whether Section 45.003(g),TEC’s requirements have been satisfied.
In view of this new landscape, school districts should proceed cautiously on projects that may be difficult to categorize pursuant to Section 45.003(g), TEC. School districts should also consider having bond counsel review and comment on all online bond project information, as it appears that this information will now be heavily scrutinized by the Texas AG.
Leon | Alcala is one of the most active law firms serving as bond counsel to school districts on bond elections and resulting bond issues. In 2023, Leon| Alcala participated in over thirty (30) bond transactions involving nearly$1.3 billion in bonds and served as counsel on twenty (20) separate bond elections involving over $3.3 billion in bonds. Our firm also assisted five (5)school districts on voter-approval tax rate elections (or VATREs). If you have any questions regarding this School Bond Brief or anything else related to school bond elections or bond issues, please do not hesitate to reach out to your Leon| Alcala attorney.