TRANSPORTATION CODE
CHAPTER 222. FUNDING AND FEDERAL AID
SUBCHAPTER A. GENERAL PROVISIONS
§ 222.001. USE OF STATE HIGHWAY FUND. Money that is
required to be used for public roadways by the Texas Constitution or
federal law and that is deposited in the state treasury to the
credit of the state highway fund, including money deposited to the
credit of the state highway fund under Title 23, United States Code,
may be used only:
(1) to improve the state highway system;
(2) to mitigate adverse environmental effects that
result directly from construction or maintenance of a state highway
by the department; or
(3) by the Department of Public Safety to police the
state highway system and to administer state laws relating to
traffic and safety on public roads.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.002. USE OF STATE HIGHWAY FUND FOR DEPARTMENT
FUNCTIONS. Money in the state highway fund that is not required to
be spent for public roadways by the Texas Constitution or federal
law may be used for any function performed by the department.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.003. ISSUANCE OF BONDS SECURED BY STATE HIGHWAY
FUND. (a) The commission may issue bonds and other public
securities secured by a pledge of and payable from revenue
deposited to the credit of the state highway fund.
(b) The aggregate principal amount of the bonds and other
public securities that are issued may not exceed $3 billion. The
commission may only issue bonds or other public securities in an
aggregate principal amount of not more than $1 billion each year.
(c) Proceeds from the sale of bonds and other public
securities issued under this section shall be used to fund state
highway improvement projects.
(d) Of the aggregate principal amount of bonds and other
public securities that may be issued under this section, the
commission shall issue bonds or other public securities in an
aggregate principal amount of $600 million to fund projects that
reduce accidents or correct or improve hazardous locations on the
state highway system. The commission by rule shall prescribe
criteria for selecting projects eligible for funding under this
section. In establishing criteria for the projects, the commission
shall consider accident data, traffic volume, pavement geometry,
and other conditions that can create or exacerbate hazardous
roadway conditions.
(e) The proceeds of bonds and other public securities issued
under this section may not be used for any purpose other than any
costs related to the bonds and other public securities and the
purposes for which revenues are dedicated under Section 7-a,
Article VIII, Texas Constitution. The proceeds of bonds and other
public securities issued under this section may not be used for the
construction of a state highway or other facility on the
Trans-Texas Corridor. For purposes of this section, the
"Trans-Texas Corridor" means the statewide system of multimodal
facilities under the jurisdiction of the department that is
designated by the commission, notwithstanding the name given to
that corridor.
(f) The commission may enter into credit agreements, as
defined by Chapter 1371, Government Code, relating to the bonds and
other public securities authorized by this section. The agreements
may be secured by and payable from the same sources as the bonds and
other public securities.
(g) All laws affecting the issuance of bonds and other
public securities by governmental entities, including Chapters
1201, 1202, 1204, 1207, 1231, and 1371, Government Code, apply to
the issuing of bonds and other public securities and the entering
into of credit agreements under this section.
(h) The proceeds of bonds and other public securities issued
under this section may be used to:
(1) finance other funds relating to the public
security, including debt service reserve and contingency; and
(2) pay the cost or expense of the issuance of the
public security.
(i) Bonds and other public securities and credit agreements
authorized by this section may not have a principal amount or terms
that, at the time the bonds or other public securities are issued or
the agreements entered into, are expected by the commission to
cause annual expenditures with respect to the obligations to exceed
10 percent of the amount deposited to the credit of the state
highway fund in the immediately preceding year.
(j) Bonds and other public securities issued under this
section may be sold in such manner and subject to such terms and
provisions as set forth in the order authorizing their issuance,
and such bonds and other public securities must mature not later
than 20 years after their dates of issuance, subject to any
refundings or renewals.
(k) The comptroller shall withdraw from the state highway
fund and forward at the direction of the commission to another
person the amounts as determined by the commission to permit timely
payment of:
(1) the principal of and interest on the bonds and
other public securities that mature or become due; and
(2) any cost related to the bonds and other public
securities that become due, including payments under credit
agreements.
Added by Acts 2003, 78th Leg., ch. 1325, § 5.01.
SUBCHAPTER B. FEDERAL AID
§ 222.031. USE OF FEDERAL AID FOR ROAD
CONSTRUCTION. Money appropriated by the United States for public
road construction in this state may be spent only by and under the
supervision of the department.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995; Acts
1997, 75th Leg., ch. 165, § 30.12, eff. Sept. 1, 1997.
§ 222.032. USE OF FEDERAL AID FOR TOLL BRIDGE
CONSTRUCTION. (a) The department may:
(1) cooperate with the United States Secretary of
Transportation in the construction of a toll bridge under 23 U.S.C.
Section 129;
(2) spend state highway funds for the purpose
described in Subdivision (1);
(3) impose tolls in accordance with 23 U.S.C. Section
129; and
(4) take other necessary or proper action to give
effect to the purpose and intent of this section.
(b) The department shall impose tolls in accordance with
this section with the goal that the tolls be eliminated, as
contemplated or required by 23 U.S.C. Section 129.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.033. INTERSTATE TOLL BRIDGES. (a) Section
222.032 applies to a bridge over a stream forming the boundary of
this state and an adjoining state.
(b) If the bridge is constructed jointly by this state and
the adjoining state, the commission may cooperate with the
appropriate authorities of the adjoining state in imposing tolls in
accordance with this section.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.034. DISTRIBUTION OF FEDERAL FUNDS. (a) Federal
aid for transportation purposes that is administered by the
commission shall be distributed to the various parts of the state
for a funding cycle through the selection of highway projects in the
state in a manner that is consistent with federal formulas that
determine the amount of federal aid for transportation purposes
received by the state. A distribution under this subsection does
not include deductions made for the state infrastructure bank or
other federal funds reallocated by the federal government.
(b) The commission may vary from the distribution procedure
provided by Subsection (a) if it issues a ruling or minute order
identifying the variance and providing a particular justification
for the variance.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.17, eff. Sept. 1,
1997.
SUBCHAPTER C. FUNDING FROM OTHER POLITICAL SUBDIVISIONS
§ 222.051. LOCAL FINANCING AND REIMBURSEMENT. (a) A
governmental unit that has the authority to build roads may finance
the construction of an approved project for the state highway
system.
(b) If funds become available, the department may contract
to reimburse the governmental unit that provided financing for the
project.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.052. LOCAL CONTRIBUTIONS. (a) The governing
body of a political subdivision of this state may contribute funds
to be spent by the commission in the development and construction of
the public roads and state highway system within the political
subdivision.
(b) The commission may accept a contribution made under
Subsection (a).
(c) In this section, "political subdivision" includes a
county or a political subdivision of a county.
Acts 1995, 74th Leg., ch. 165, § 1, eff. Sept. 1, 1995.
§ 222.053. RELIEF FROM LOCAL MATCHING FUNDS
REQUIREMENT. (a) In this section, "economically disadvantaged
county" means a county that has, in comparison to other counties in
the state:
(1) below average per capita taxable property value;
(2) below average per capita income; and
(3) above average unemployment.
(b) Except as provided by Subsection (c), the commission may
require, request, or accept from a political subdivision matching
or other local funds, rights-of-way, utility adjustments,
additional participation, planning, documents, or any other local
incentives to make the most efficient use of its highway funding.
(c) In evaluating a proposal to construct, maintain, or
extend a highway or for another type of highway project in a
political subdivision that consists of all or a portion of an
economically disadvantaged county, the commission:
(1) may not consider the absence or value of local
incentives provided under Subsection (b) or the value of a benefit
received by the state in an agreement under Section 791.031,
Government Code, beyond the minimum required local matching funds;
and
(2) shall adjust the minimum local matching funds
requirement after evaluating the political subdivision's effort
and ability to meet the requirement.
(d) In making an adjustment under Subsection (c)(2), the
commission may use its in-kind resources and any other available
resources to help satisfy a federal requirement.
(e) The commission shall report annually to the governor,
the lieutenant governor, and the speaker of the house of
representatives on the use of matching funds and local incentives
and the ability of the commission to ensure that political
subdivisions located in economically disadvantaged counties have
equal ability to compete for highway funding with political
subdivisions in counties that are not economically disadvantaged.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.18, eff. Sept. 1,
1997.
SUBCHAPTER D. STATE INFRASTRUCTURE BANK
§ 222.071. DEFINITIONS. In this subchapter:
(1) "Bank" means the state infrastructure bank
account.
(2) "Construction" has the meaning assigned by 23
U.S.C. Section 101.
(3) "Federal act" means Section 350 of the National
Highway System Designation Act of 1995 (Pub. L. No. 104-59).
(4) "Federal-aid highway" has the meaning assigned by
23 U.S.C. Section 101.
(5) "Qualified project" includes:
(A) the construction of a federal-aid highway;
(B) a transit project under 49 U.S.C. Sections
5307, 5309, and 5311; or
(C) for the expenditure of secondary funds, a
project eligible for assistance under Title 23 or Title 49, United
States Code.
(6) "Secondary funds" includes:
(A) the repayment of a loan or other assistance
that is provided with money deposited to the credit of the bank;
and
(B) investment income generated by secondary
funds deposited to the credit of the bank.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
§ 222.072. STATE INFRASTRUCTURE BANK. (a) The state
infrastructure bank is an account in the state highway fund. The
bank is administered by the commission.
(b) Federal funds received by the state under the federal
act, matching state funds in an amount required by that act,
proceeds from bonds issued under Section 222.075, money saved as a
result of contracting with a private entity for maintenance and
repair services for department vehicles, secondary funds, and other
money received by the state that is eligible for deposit in the bank
may be deposited into the bank and used only for the purposes
described in this subchapter.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
§ 222.073. PURPOSES OF INFRASTRUCTURE BANK. The
commission shall use money deposited in the bank to:
(1) encourage public and private investment in
transportation facilities, including facilities that contribute to
the multimodal and intermodal transportation capabilities of the
state; and
(2) develop financing techniques designed to:
(A) expand the availability of funding for
transportation projects and to reduce direct state costs;
(B) maximize private and local participation in
financing projects; and
(C) improve the efficiency of the state
transportation system.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
§ 222.074. FORM OF ASSISTANCE. (a) To further a
purpose described by Section 222.073, the commission may use money
deposited to the credit of the bank to provide financial assistance
to a public or private entity for a qualified project to:
(1) extend credit by direct loan;
(2) provide credit enhancements;
(3) serve as a capital reserve for bond or debt
instrument financing;
(4) subsidize interest rates;
(5) insure the issuance of a letter of credit or credit
instrument;
(6) finance a purchase or lease agreement in
connection with a transit project;
(7) provide security for bonds and other debt
instruments; or
(8) provide methods of leveraging money that have been
approved by the United States secretary of transportation and
relate to the project for which the assistance is provided.
(b) Financial assistance to a private entity under
Subsection (a) shall be limited to a qualified project that:
(1) provides transportation services or facilities
that provide a demonstrated public benefit; or
(2) is constructed or operated in cooperation with a
state agency or political subdivision in accordance with an
agreement between that agency or political subdivision and the
private entity.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
§ 222.0745. INCURRENCE OF DEBT BY PUBLIC ENTITY. (a) A
public entity in this state, including a municipality, county,
district, authority, agency, department, board, or commission,
that is authorized by law to construct, maintain, or finance a
qualified project may borrow money from the bank, including by
direct loan, based on the credit of the public entity.
(b) Money borrowed under this section must be segregated
from other funds under the control of the public entity and may only
be used for purposes related to a qualified project.
(c) The authority granted by this section does not affect
the ability of a public entity to incur debt using other statutorily
authorized methods.
Added by Acts 2001, 77th Leg., ch. 4, § 1, eff. April 9, 2001.
§ 222.075. REVENUE BONDS. (a) The commission may
issue revenue bonds for the purpose of providing money for the bank.
(b) Except as provided by Subsection (c), the commission may
issue revenue bonds or revenue refunding bonds under this section
without complying with any other law applicable to the issuance of
bonds.
(c) Notwithstanding any other provision of this section,
the following laws apply to bonds issued by the commission:
(1) Chapters 1201, 1202, 1204, 1231, and 1371,
Government Code; and
(2) Subchapters A-C, Chapter 1207, Government Code
(d) The revenue bonds are special obligations of the
commission payable only from income and receipts of the bank as the
commission may designate. The income and receipts include
principal of and interest paid and to be paid on acquired
obligations, other designated obligations held by the bank, or
income from accounts created within the bank.
(e) The revenue bonds do not constitute a debt of the state
or a pledge of the faith and credit of the state.
(f) The commission may require participants to make
charges, levy taxes, or otherwise provide for sufficient money to
pay acquired obligations.
(g) Revenue bonds issued under this section shall be
authorized by order of the commission and shall have the form and
characteristics and bear the designations as are provided in the
order.
(h) Revenue bonds shall:
(1) be dated;
(2) bear interest at the rate or rates authorized by
law;
(3) mature at the time or times, serially, as term,
revenue bonds, or otherwise not more than 50 years after their
dates;
(4) be called before stated maturity on the terms and
at the prices, be in the denominations, be in the form, either
coupon or registered, carry registration privileges as to principal
only or as to both principal and interest and as to successive
exchange of coupon for registered bonds or one denomination for
bonds of other denominations, and successive exchange of registered
revenue bonds for coupon revenue bonds, be executed in the manner,
and be payable at the place or places inside or outside the state,
as provided in the order;
(5) be issued in temporary or permanent form;
(6) be issued in one or more installments and from time
to time as required and sold at a price or prices and under terms
determined by the commission to be the most advantageous reasonably
obtainable; and
(7) be issued on a parity with and be secured in the
manner as other revenue bonds authorized to be issued by this
section or be issued without parity and secured differently from
other revenue bonds.
(i) All proceedings relating to the issuance of revenue
bonds issued under this section shall be submitted to the attorney
general for examination. On determining that the revenue bonds
have been authorized in accordance with law, the attorney general
shall approve the revenue bonds, and the revenue bonds shall be
registered by the comptroller. After the approval and
registration, the revenue bonds are incontestable in any court or
other forum for any reason and are valid and binding obligations in
accordance with their terms for all purposes.
(j) The proceeds received from the sale of revenue bonds
shall be deposited in the bank and invested in the manner provided
for other funds deposited under this subchapter.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997. Amended by Acts 2001, 77th Leg., ch. 1420, § 8.373, eff.
Sept. 1, 2001.
§ 222.076. SEPARATE SUBACCOUNTS. The bank shall
consist of at least two separate subaccounts, a highway subaccount
and a transit subaccount.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
§ 222.077. REPAYMENT TERMS; DEPOSIT OF REPAYMENTS;
INVESTMENT INCOME. (a) Any funds disbursed through the state
infrastructure bank must be repaid on terms determined by the
commission that comply with the federal act.
(b) Notwithstanding any other law to the contrary:
(1) the repayment of a loan or other assistance
provided with money deposited to the credit of a subaccount in the
bank shall be deposited in that subaccount; and
(2) investment income generated by money deposited to
the credit of a subaccount in the bank shall be:
(A) credited to that subaccount;
(B) available for use in providing financial
assistance under this subchapter; and
(C) invested in United States Treasury
securities, bank deposits, or other financing instruments approved
by the United States secretary of transportation to earn interest
and enhance the financing of projects assisted by the bank.
(c) The commission shall administer the bank in compliance
with the federal act and any applicable federal regulation or
guideline.
(d) The commission by rule shall:
(1) implement this subchapter; and
(2) establish eligibility criteria for an entity
applying for financial assistance from the bank.
Added by Acts 1997, 75th Leg., ch. 1171, § 1.21, eff. Sept. 1,
1997.
SUBCHAPTER E. TOLL FACILITIES
§ 222.101. EXPENDITURE OF MONEY. The department may
spend money from any source for the construction, maintenance, and
operation of toll facilities.
Added by Acts 1997, 75th Leg., ch. 1171, § 7.01, eff. Sept. 1,
1997.
§ 222.102. TEMPORARY TOLL PROJECTS. The department may
recover the cost of a preventative maintenance or rehabilitation
project on a nontoll segment of the state highway system by
temporarily imposing a toll charge after notice and a public
hearing.
Added by Acts 1997, 75th Leg., ch. 1171, § 7.01, eff. Sept. 1,
1997.
§ 222.103. COST PARTICIPATION. (a) The department may
participate, by spending money from any available source, in the
cost of the acquisition, construction, maintenance, or operation of
a toll facility of a public or private entity on terms and
conditions established by the commission. The commission:
(1) may require the repayment of any money spent by the
department for the cost of a toll facility of a public entity; and
(2) shall require the repayment of any money spent by
the department for the cost of a toll facility of a private entity.
(b) Money repaid as required by the commission shall be
deposited to the credit of the fund from which the expenditure was
made. Money deposited as required by this section is exempt from
the application of Section 403.095, Government Code.
(c) A bond or other debt obligation issued by a public or
private entity to finance the cost of a toll facility in which the
department participates is an obligation of the issuing entity and
is not an obligation of this state.
(d) On the request of a member of the legislature, the
department shall provide the member a status report on all highway
construction projects, by legislative district, that are under
contract or awaiting funding. The report shall include projects
that would be funded in any manner by state, federal, or toll funds.
(e) On the request of a member of the legislature, not later
than the 90th day before the date a loan is granted or an
expenditure is made by the department for a project under this
section, the department shall notify each member of the legislature
that represents any part of the area affected by the project of the
status of the project and how any other project in any other
district would be affected.
(f) This section applies to any participation by the
department in the cost of a project under Chapter 284, 361, or 366.
(g) The commission shall adopt rules to implement
Subsection (a).
(h) Money granted by the department each fiscal year under
this section may not exceed $800 million. This limitation does not
apply to money required to be repaid.
(i), (j) Repealed by Acts 2003, 78th Leg., ch. 312, § 77;
Acts 2003, 78th Leg., ch. 1325, § 15.74.
Added by Acts 1997, 75th Leg., ch. 1171, § 7.01, eff. Sept. 1,
1997. Amended by Acts 2001, 77th Leg., ch. 1237, § 1; Acts 2003,
78th Leg., ch. 312, § 77, eff. June 18, 2003; Acts 2003, 78th
Leg., ch. 1325, § 15.74, 19.02, eff. June 21, 2003.
§ 222.104. PASS-THROUGH TOLLS. (a) In this section,
"pass-through toll" means a per vehicle fee or a per vehicle mile
fee that is determined by the number of vehicles using a highway.
(b) The department may enter into an agreement with a public
or private entity that provides for the payment of pass-through
tolls to the public or private entity as reimbursement for the
construction, maintenance, or operation of a toll or nontoll
facility on the state highway system by the public or private
entity.
(c) The department may enter into an agreement with a
regional mobility authority, a regional tollway authority, or a
county acting under Chapter 284 that provides for the payment of
pass-through tolls to the authority or county as compensation for
the payment of all or a portion of the costs of maintaining a state
highway or a portion of a state highway converted to a toll facility
of the authority or county that the department estimates it would
have incurred if the highway had not been converted.
(d) The department may use any available funds for the
purpose of making a pass-through toll payment under this section.
(e) The commission may adopt rules necessary to implement
this section. Rules adopted under this subsection may establish
criteria for:
(1) determining the amount of pass-through tolls to be
paid under this section; and
(2) allocating the risk that traffic volume will be
higher or lower than the parties to an agreement under this section
anticipated in entering the agreement.
Added by Acts 2003, 78th Leg., ch. 1325, § 6.01, eff. June 21,
2003.
