Sec. 1109.159. AUTHORITY TO BORROW MONEY; SECURITY. (a) The board may borrow money at a rate not to exceed the maximum annual percentage rate allowed by law for district obligations at the time the loan is made if the board declares that: (1) money is not available to meet authorized obligations of the district; and (2) an emergency exists. (b) To secure a loan, the board may pledge: (1) district revenue that is not pledged to pay the district's bonded indebtedness; (2) a district tax to be imposed by the district in the next 12-month period that is not pledged to pay the principal of or interest on district bonds; or (3) a district bond that has been authorized but not sold. (c) A loan for which taxes or bonds are pledged must mature not later than the first anniversary of the date the loan is made. A loan for which district revenue is pledged must mature not later than the fifth anniversary of the date the loan is made. (d) The board may not spend money obtained from a loan under this section for any purpose other than: (1) the purpose for which the board declared an emergency; and (2) if district taxes or bonds are pledged to pay the loan, the purposes for which the taxes were imposed or the bonds were authorized.
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