CHAPTER 164. JOINT OWNERSHIP OF ELECTRIC FACILITIES BY PUBLIC ENTITIES
UTILITIES CODE
TITLE 4. DELIVERY OF UTILITY SERVICES
SUBTITLE A. UTILITY CORPORATIONS AND OTHER PROVIDERS
CHAPTER 164. JOINT OWNERSHIP OF ELECTRIC FACILITIES BY PUBLIC
ENTITIES
Sec. 164.001. JOINT OWNERSHIP OF ELECTRIC UTILITY FACILITIES
AUTHORIZED. (a) Political subdivisions may join together to
finance, construct, complete, acquire, or operate electric
utility facilities so that the facilities or an undivided
interest in the facilities is jointly owned by the political
subdivisions as cotenants or co-owners.
(b) The ownership shares in the facilities are those approved by
the governing bodies of the political subdivisions, as set forth
in an agreement authorized by the governing bodies.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 164.002. PUBLIC PURPOSE. The exercise by a political
subdivision of the authority granted by this chapter, including
the exercise of the power to issue bonds, notes, or other
obligations to accomplish the purposes of this chapter, and the
performance of an agreement entered into under this chapter are
considered to be additional public purposes of the political
subdivision, without regard to any express or implied limitation
on the authority or purposes of the political subdivision under
any other general or special law or charter provision.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 164.003. APPROVAL OF AGREEMENT BY ATTORNEY GENERAL. (a)
An agreement between political subdivisions establishing an
interest in electric utility facilities that is executed under
this chapter shall be submitted to the attorney general in
connection with any proceeding to finance the contractual
obligation by the issuance of bonds.
(b) An agreement submitted under Subsection (a) is incontestable
on approval as to legality by the attorney general.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 164.004. INCREASE IN OWNERSHIP SHARES. (a) An agreement
under this chapter may provide for a political subdivision to
increase its present or future ownership share of the electric
utility facilities by installment purchase payments and for
another political subdivision that is a party to the agreement to
transfer, in consideration of those payments, any portion of its
present or future ownership share of the facilities to the
purchasing political subdivision.
(b) A payment made by a political subdivision to acquire an
ownership interest is not treated as a maintenance and operating
expense but is treated as a capital cost as if the political
subdivision had issued bonds to construct or acquire the
ownership interest, unless otherwise specified in the agreement.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 164.005. CONTRACTUAL OBLIGATIONS AS LIEN ON SYSTEM REVENUE.
(a) If the electric utility facilities financed, acquired,
constructed, or completed are a part of a utility system of a
political subdivision, the obligation to make the contract
payments to acquire an ownership interest is a lien on the
revenue of the system on a parity with the outstanding bonds of
the system to the extent permitted in the ordinance or resolution
authorizing or the deed of trust or indenture securing the
payment of the outstanding bonds.
(b) If the ordinance or resolution authorizing or the deed of
trust or trust indenture securing the revenue bonds of a utility
system provides for the subsequent issuance of additional bonds
or the creation of a contractual obligation described by Section
164.004 and provides that the payments to be made for the
security or payment of the subsequent bonds or contractual
obligation are to be on a parity with the previously issued bonds
or bonds then to be issued, the political subdivision may,
subject to any conditions contained in that ordinance,
resolution, deed of trust, or trust indenture, authorize, issue,
and sell additional bonds or incur the contractual obligation in
a different series payable from the entire revenue of the utility
system on a parity with the previously issued bonds or bonds then
to be issued and secured by a lien on the revenue of the system
on a parity with the lien securing the previously issued bonds or
bonds then to be issued. This subsection applies without regard
to whether the previously issued bonds:
(1) were issued before August 29, 1977; or
(2) are an original issue or a refunding issue.
(c) A political subdivision may pledge the revenue of a utility
system to pay contract payments to acquire an ownership interest
in an electric utility facility under this chapter.
(d) In this section, "utility system" includes a combined
utility system.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Sec. 164.006. CONSTRUCTION WITH OTHER LAWS. To provide full
authority for the execution of an agreement under this chapter,
this chapter applies to a municipality as if this chapter were
originally contained in Chapter 1501 or 1502, Government Code, or
Chapter 552, Local Government Code. This chapter prevails over
any charter provision or general or special law.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.405, eff. Sept.
1, 2001.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
885, Sec. 3.77(30), eff. April 1, 2009.