1. (a) A client agency shall submit a request for financing when it is prepared to proceed with a program financing. A resolution of the client agency's governing body which authorizes the request for financing and the execution of documents required under the program shall be submitted with the request. Upon receipt of a request for financing the authority will review such request for completeness and compliance with program rules. If the request for financing is found to be complete and in compliance, the authority will accept the request for financing.
2. (b) Upon acceptance of the request for financing, if the client agency has not previously participated in the program, the authority will forward to the client agency a copy of the master lease agreement to be executed by an authorized representative. The master lease agreement is not subject to revision by the client agency and, when executed by the client agency's authorized representative and the authority, will serve as the basis for all future purchases of eligible project under the program.
3. (c) After acceptance of the request for financing by the authority and execution of the master lease agreement, the client agency will proceed to procure the eligible project in compliance with all applicable laws and rules governing such procurement, including obtaining the approval, if any is required, of the Bond Review Board, the Department of Information Resources, the General Services Commission, or other state agency.
4. (d) After the client agency has taken delivery and acceptance of the eligible project and determined that it meets all requirements for payment in full to the vendor, the client agency will prepare the lease supplement together with all documents required by the comptroller and will execute two copies of the lease supplement which also contains the statement of acceptance of the eligible project and will forward all copies along with the payment voucher and all other documents to the authority. The authority will immediately execute two copies of the lease supplement and return one copy to the client agency.
5. (e) The authority will make a determination to initially fund the eligible project through the interim financing or through the issuance of lease revenue bonds. Such determination will be within the sole discretion of the authority.
6. (f) The authority will effect the payment in full to the vendor, or partial payment if the eligible project has been designated for progress payments.
7. (g) Upon receipt of the lease supplement, the authority and the comptroller will effect the comptroller's intercept to provide for the lease payments.
8. (h) No later than on or before 48 hours prior to a lease payment, the authority will submit a voucher directing the comptroller to transfer sufficient monies from each client agency into the state lease fund the authority will provide a voucher to the comptroller to effect debt service payment. The treasurer will then transfer monies out of the state lease fund and make lease payments.
9. (i) Within 30 days following each lease payment, the authority will provide a debit memo to each client agency.

10. (j) The authority may issue lease revenue bonds in order to refinance the lease supplements initially funded through the interim financing. The final maturity of lease revenue bonds shall not exceed the latest maturity of the lease supplements being financed upon the occurrence of any of the following events:

    1. (1) any date on which the aggregate volume of lease supplements then being financed through the interim financing reaches $75 million; or
    2. (2) 30 days prior to the end of any state biennial appropriation period which is currently August 31 of odd-numbered years.
11. (k) The authority may adjust the lease payments under a lease supplement as a result of a change in interest rates, or a refinancing, or a change in administrative costs. When such adjustment in lease payments is effected, the authority will, concurrent with establishing the new interest rate, provide an amended amortization schedule reflecting the adjusted lease payments to the comptroller and to each client agency.
12. (l) At least once during each fiscal year of the state the authority will forward to the Legislative Budget Board (LBB) a schedule, by client agency, of all lease payments. The authority will use its best efforts to ensure that the staff of the LBB will include in its budget recommendation sufficient appropriations to make all lease payments required under the program.
13. (m) All books and records of the authority will be available to the LBB, the comptroller, the state auditor's office, client agencies, and other interested parties which may, from time to time, request access to information regarding the program.
14. (n) All issuances of lease revenue bonds under the program will comply with all approvals required for the public issuance of debt by a state agency, including review and approval by the Bond Review Board and the attorney general.

Source Note:The provisions of this §225.5 adopted to be effective April 14, 1993, 18 TexReg 2143; amended to be effective December 15, 1998, 23 TexReg 12687.