Sec. 56.242.  MAINTENANCE TAX.  (a)  The board shall have a tax assessed and collected on district property sufficient to maintain, repair, and preserve district improvements and to pay legal debts, demands, and obligations of the district, but in districts operating under Article III, Section 52, of the Texas Constitution, the tax may not be in an amount greater than one-half of one percent of the total assessed valuation of the district for that year.
(b)  Taxes collected under this section shall be placed in the construction and maintenance fund.
(c)  The board may issue negotiable notes payable from the maintenance tax authorized by Subsection (a) to meet the financial obligations of the district, as described by Subsection (a).  The notes shall be payable over a period not to exceed five years from the date of issuance.  Notes issued under this subsection are not required to be approved by the Texas Natural Resource Conservation Commission.  A district may not have outstanding, at any one time, notes in excess of $3 million under this subsection.
(d)  The board may issue negotiable notes to pay any lawful expenditure of the district, other than principal and interest on debt, including all costs to improve or repair any existing drainage canal, ditch, watercourse, or other work constructed, repaired, or improved by the district.  The notes may be payable from and secured by a lien on and pledge of any available funds of the district, including the proceeds of a maintenance tax.  Notes issued under this subsection shall be payable over a period not to exceed 20 years from the date of issuance and if issued for a term longer than one year must be treated as "debt" as defined by Section 26.012, Tax Code.  The maximum debt service on all notes issued under this subsection may not exceed in any fiscal year of a district an amount that could be paid from the proceeds of one-fourth of the maximum tax the district is authorized by law to levy on the date any notes are issued.
Acts 1971, 62nd Leg., p. 519, ch. 58, Sec. 1, eff. Aug. 30, 1971.  Amended by Acts 2001, 77th Leg., ch. 298, Sec. 14, eff. Sept. 1, 2001.