The content of transcripts submitted to the Bond Division of the attorney general's office for approval shall conform to the following requirements.

1. (1) The authorizing document of a proposed issue shall cite the article number or numbers of the Texas Constitution and Civil Statutes with respect to the legal authority for the proposed issue. Uncodified laws should be cited by reference to session laws.
2. (2) Similar citations shall be made to different statutes, if any, authorizing the improvements or services to be acquired or built by the issuer, contracts with other parties for payment of principal and interest and other charges relative to securities, as well as conveyances, leases, or sales of the improvements built from proceeds of securities sales.
3. (3) A debt retirement schedule must accompany all limited tax and combination tax-revenue issues. It shall be current as of the date of sale of the issue, and include the requirements of the proposed tax issue at the actual interest rates bid and accepted. No sinking fund balance will be deducted from outstanding indebtedness in computing debt average and debt limit.
4. (4) If no notice of sale is required by law for the issue, certification shall include a recital of the manner of the sale, such as whether it was private, negotiated, or whether competitive bidding was secured other than by publication and circulation of a notice of sale, identification of the purchaser, and whether par, discount, or premium applied to the principal sum.

5. (5) Subject to conflict with statutory or other applicable law, the following will govern the determination of usury in the sale of municipal securities.

   1. (A) The entire premise of the usury laws is to protect the borrower (municipal issuer) from excessive interest rates imposed by the lender without specific legislative recognition and approval.
   2. (B) Until established otherwise, municipal bonds and securities shall be treated as any other contract in terms of usury.
   3. (C) Since bonds and interest coupons are each individual, separate contracts or agreements to pay a stated amount, and given the fact that Texas Constitution, Article 11, §11, speaks in terms of interest rates on a "per annum" basis, calculations for usury purposes shall be made on an annual basis rather than a "net effective interest rate" basis for an entire series of bonds. Therefore, if the calculations for any one year exceed the 10% limit, there shall be a determination of usury.
   4. (D) Pure bond discount as bid by the purchaser of the bonds is to be treated as interest.
   5. (E) Pure bond discount as bid by the purchaser of the bonds shall be spread over the life of the bonds.
   6. (F) Actual, pure interest shall be treated, of course, as it is.
   7. (G) Optional redemption premium shall not be treated as interest.
   8. (H) Mandatory redemption, whether by serial numbers or to be selected by arbitrary means, whereby a specific face value of bonds are to be redeemed in specific years prior to maturity shall be treated as serial maturities in terms of usury. In other words, all calculations and every item of discount and interest shall be determined to the dates of mandatory redemption rather than scheduled maturity.
   9. (I) Although unsettled at this time, financial advisory fees shall only be considered discount when the financial advisor is the purchaser of the bonds and the bonds were not sold pursuant to public bid.
   10. (J) Credits for bid premiums will be applied as offsets.
   11. (K) Supplemental coupons will be treated as interest.
6. (6) All certificates must bear live signatures of the persons executing them and must be impressed with the issuer's seal unless legally executed written authority for Texas Civil Statutes, Article 717j-1, facsimile specifically for the certificate is included in the transcript. Authentic copies of certificates whereon manual or facsimile signatures and seals are clearly legible are also acceptable. These same requirements apply to contracts, governmental orders, and other signed and sealed documentation in transcripts.
7. (7) Certification of incumbency of all members of the governing body of every public issuer serving during the time of action on each voted document shall be required in each transcript of public securities tendered for approval. Additionally, certification of the incumbency of each public issuer's executive or administrative officer subscribing any document in the transcript is necessary. Certifications for city secretaries, county clerks, and other officers customarily certifying incumbencies may be made by the presiding officer of the governing body of the issuer, vice-chairman, vice-president, presiding officer pro tempore, or other member of the governing body. Certifications may be made in a general certificate, in separate incumbency certificates, in minutes excerpts, or combination thereof.

Source Note:The provisions of this §53.3 adopted to be effective January 1, 1976.