Texas Transportation Code 284.042 – Use of Bond Proceeds; Lien
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(a) The proceeds of bonds issued under this chapter:
(1) may be used only to pay the costs of the project described by § 284.043; and
(2) shall be disbursed under the restrictions the bond instrument provides.
(b) Project operating and maintenance costs to be paid from proceeds of bonds payable in whole or in part from project revenue may include only items expressly defined in the proceedings authorizing the bonds.
Terms Used In Texas Transportation Code 284.042
- Lien: A claim against real or personal property in satisfaction of a debt.
- Trustee: A person or institution holding and administering property in trust.
(c) Notwithstanding Subsection (a), bond proceeds that remain after the project costs are paid in full shall be used to pay interest on and retire the bonds, unless otherwise provided in the bond instrument.
(d) Unless otherwise provided in the bond instrument, if the bond proceeds are not sufficient to pay all the project costs, additional bonds may be issued up to the amount necessary to pay the remaining costs. The additional bonds are considered to be of the same issue as the original bonds and are entitled to payment from the same fund, without preference for the bonds first issued.
(e) The bondholder or a bond trustee has a lien on the bond proceeds.