(a) A district desiring to proceed under the Federal Bankruptcy Code, Chapter 9 (11 United States Code, §§901 - 946) or any other federal bankruptcy law shall submit an application requesting authorization pursuant to Water Code, §49.456. The application shall consist of the following:
  (1) a certified copy of the resolution adopted by the board of directors or other governing body requesting such authorization;
  (2) an application fee of $100 plus the cost of required notice;
  (3) a district status report with all information current and certified within 30 days prior to the date of submittal;
  (4) a comparison of the projections or assumptions of growth, taxes, revenues and expenses submitted to the commission in connection with the approval of the bonds issued most recently by the district, or, if commission approval was not required, the projections or assumptions used by the district in connection with the bonds most recently issued by the district, to the actual growth, taxes, revenues and expenses;
  (5) a description of the reasons that, in the opinion of the governing body of the district, the projections and assumptions used in connection with the most recent issue of bonds were not realized and any other factors which have caused the district financial difficulties;
  (6) a complete analysis of the tax rate, user fees or other charges or sources of revenues that the district may lawfully impose that would be necessary in order for the district to meet its debts and obligations as they become due and the impact of such taxes and fees upon taxpayers and users within the district;
  (7) a complete analysis of the reasons that the district cannot, through the full exercise of its rights and powers under the laws of this state, reasonably expect to meet its debts and other obligations as they mature;
  (8) a statement of whether the district has complied with the commission order, approving the issuance of bonds, and this chapter;
  (9) a list of the names and addresses of all creditors of the district or a statement explaining the reasons for the inability to obtain such a list and the efforts taken to identify such creditors;
  (10) the plan of adjustment of the district's debt which it proposes to file in the bankruptcy proceeding if the commission authorizes the district to proceed; and
  (11) such other information which the commission considers material to a determination of whether authorization to proceed in bankruptcy should be granted.
(b) The chief clerk shall mail written notice to all creditors shown in the district's application, all developers and their lien-holders and the top ten taxpayers shown in the district status report, the city in whose corporate limits or extraterritorial jurisdiction the district is located, if any, and the county in which the district is located. The chief clerk shall publish notice of the application at least once a week for two consecutive weeks in a newspaper of general circulation in the county in which the district is located. The chief clerk shall also publish notice of the application once in the Texas Bond Reporter of Austin, The Daily Bond Buyer, The Weekly Bond Buyer, or The Wall Street Journal. Such notices shall be mailed or published within 30 days of the date an administratively complete application is received by the executive director. The commission shall not act on the application before 30 days after such notices are given, mailed, or published.
(c) If, after consideration of all evidence, the commission determines that the district cannot, through the full exercise of its rights and powers under the law of this state, reasonably expect to meet its debts and other obligations as they mature, the commission may authorize the district to proceed in bankruptcy.
(d) If the commission determines that the district can, through the full exercise of its rights and powers under the laws of this state, reasonably expect to meet its debt and other obligations as they mature, the commission shall deny the district's application and shall order the district to adopt specific measures to generate sufficient revenues to meet its obligations. The commission shall also require the district to submit periodic reports on the implementation of the measures required by the commission and its current financial condition.
(e) The commission may assess additional fees adequate to cover its cost in administering this section.

Source Note: The provisions of this §293.88 adopted to be effective August 5, 1988, 13 TexReg 3638; amended to be effective October 22, 1996, 21 TexReg 9905; amended to be effective September 14, 2000, 25 TexReg 8955