AI-assisted research summary: A public utility agency may issue and finance obligations, pledge certain revenues and funds, set aside proceeds for specified funds and expenses, invest proceeds while awaiting use, and it may not use an agency-owned facility as collateral for a new facility without required approval.
Sec. 572.062. OBLIGATIONS. (a) A public utility agency may: (1) issue obligations, including anticipation notes, to accomplish the purposes of the agency; and (2) finance or refund the acquisition, construction, expansion, and improvement of all or a portion of a facility relating to an agency purpose. (b) Except as provided by Subsection (b-1), the public utility agency may pledge to the payment of the obligations: (1) the revenue of all or part of its facilities, including facilities acquired after the obligations are issued; (2) revenues received from a public entity by contract as authorized by a concurrent ordinance; (3) special assessments imposed by a public entity and provided by contract to the agency; or (4) any other funds of the agency. (b-1) Operation and maintenance expenses, including salaries and labor, materials, and repairs of facilities necessary to render efficient service, are a first lien on and charge against the pledged revenue. (b-2) A public utility agency may not use a facility owned by the agency to secure or collateralize a new facility without the approval by resolution of each participating public entity participating in the joint financing of the new facility. This subsection does not apply to the use of revenue from a facility owned by the agency to secure or collateralize a new facility. (c) The public utility agency may set aside from the proceeds of the sale of the obligations amounts for payment into the interest and sinking fund and reserve fund, and for interest and operating expenses during construction and development, as specified in the proceedings authorizing the obligations. (d) Obligation proceeds may be invested, pending their use, in securities, interest-bearing certificates, or time deposits as specified in the proceedings authorizing the obligations. Added by Acts 1999, 76th Leg., ch. 227, Sec. 19, eff. Sept. 1, 1999. Renumbered from Local Government Code, Section 422.062 by Acts 2007, 80th Leg., R.S., Ch. 885 (H.B. 2278), Sec. 3.76(c)(2), eff. April 1, 2009. Amended by: Acts 2025, 89th Leg., R.S., Ch. 90 (S.B. 1169), Sec. 9, eff. May 20, 2025.