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Texas Transportation Code - TRANSP § 228.109. Trust Agreement

Current as of January 01, 2024 | Updated by Findlaw Staff

(a) Bonds issued under this subchapter may be secured by a trust agreement between the commission and a corporate trustee that is a trust company or a bank that has the powers of a trust company.

(b) A trust agreement may pledge or assign the tolls and other revenue to be received but may not convey or mortgage any part of a toll project or system.

(c) A trust agreement may not evidence a pledge of the revenue of a toll project or system except:

(1) to pay the cost of maintaining, repairing, and operating the project or system;

(2) to pay the principal of, interest on, and any redemption premium on the bonds as they become due and payable;

(3) to create and maintain reserves for the purposes described by Subdivisions (1) and (2), as prescribed by Section 228.053;  and

(4) as otherwise provided by law.

(d) Notwithstanding Subsection (c), surplus revenue may be used for a transportation or air quality project as authorized by Section 228.006.

(e) A trust agreement may:

(1) set forth the rights and remedies of the bondholders and the trustee;

(2) restrict the individual right of action by bondholders as is customary in trust agreements or trust indentures securing corporate bonds and debentures;  and

(3) contain provisions the commission determines reasonable and proper for the security of the bondholders.

(f) The expenses incurred in carrying out a trust agreement may be treated as part of the cost of operating the toll project or system.

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Cite this article: FindLaw.com - Texas Transportation Code - TRANSP § 228.109. Trust Agreement - last updated January 01, 2024 | https://codes.findlaw.com/tx/transportation-code/transp-sect-228-109/

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