Sec. 51.438.  REFUNDING BONDS.  (a)  A district may issue bonds to refund all or any part of its outstanding bonds, notes, or other obligations including matured but unpaid interest coupons.
(b)  Refunding bonds shall mature serially or otherwise not more than 40 years from their date and shall bear interest at any rate or rates permitted by the constitution and laws of this state.
(c)  Refunding bonds may be made payable from the same source as the bonds, notes, or other obligations being refunded or from other additional sources.
(d)  The refunding bonds must be approved by the attorney general in the manner provided by law for other bonds of the district and shall be registered by the comptroller on the surrender and cancellation of the bonds being refunded.
(e)  The orders or resolutions authorizing the issuance of the refunding bonds may provide that the refunding bonds will be sold and the proceeds deposited in the place or places at which the bonds being refunded are payable, in which case the refunding bonds may be issued before the cancellation of the bonds being refunded.  If refunding bonds are issued before cancellation of the other bonds, an amount which, when added to the earnings and profits from the investment of such amount, is sufficient to pay the interest on and principal of the bonds being refunded to their maturity dates, or to their option dates if the bonds have been duly called for payment prior to maturity according to their terms, shall be deposited in the place or places at which the bonds being refunded are payable.
(f)  The comptroller shall register refunding bonds without the surrender and cancellation of bonds being refunded.
(g)  A refunding may be accomplished in one or in several installment deliveries.
(h)  Refunding bonds are investment securities under Chapter 8, Business & Commerce Code.
(i)  In lieu of the method provided by this section, a district may refund bonds, notes, or other obligations as provided by the general law of the state.
Acts 1971, 62nd Leg., p. 344, ch. 58, Sec. 1, eff. Aug. 30, 1971.  Amended by Acts 1985, 69th Leg., ch. 215, Sec. 1, eff. Sept. 1, 1985.