Texas Statutes
Subchapter B. Bonds for Navigational Facilities in Certain Coastal Municipalities
Section 1505.057. Encumbrance as Additional Security

Sec. 1505.057. ENCUMBRANCE AS ADDITIONAL SECURITY. (a) As additional security for the payment of the principal of and interest on bonds issued under this subchapter, a municipality may encumber any part or all of a project undertaken with funds derived from the bonds.
(b) An encumbrance entered into under this section:
(1) may provide for a grant, to a purchaser under sale or foreclosure, of a franchise to operate the encumbered project for a term not to exceed 20 years from the date of purchase, subject to all laws regulating the same then in force; and
(2) shall:
(A) provide for a trustee to enforce foreclosure; and
(B) provide the municipality with the option at any five-year period within the 20-year term after purchase to repurchase a project, other than reclaimed land acquired by an individual purchaser, under reasonable terms and at a reasonable price stated in the encumbrance.
(c) Subject to Section 1505.076, the governing body of the municipality shall manage and control a project while it is encumbered under this section.
Added by Acts 1999, 76th Leg., ch. 227, Sec. 1, eff. Sept. 1, 1999.

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