Bond Guarantee Program

The Bond Guarantee Program (BGP), using the corpus of the Permanent School Fund (PSF), guarantees bonds issued by a school district or charter school. The PSF guarantee has received “AAA” ratings from the major bond rating services and replaces the need for private bond insurance. 

Both districts and charters must apply to the TEA and be approved by the commissioner of education to participate in this program. The TEA reviews each application according to statutory requirements and State Board of Education (SBOE) rules. This review must confirm that the application is complete and accurate. The district or charter must also be financially sound. The TEA also reviews the School FIRST rating or Charter FIRST rating, the annual financial audit report, accreditation status, and any complaints.


Law and Rules


Information on Applying for a Guarantee

The TEA only accepts applications for the BGP through the Municipal Advisory Council (MAC) website

The link to the sign-up page for the BGP is located on MAC home page. Click that link.

  • If you currently have an account with the MAC, click the Please enable my account button (indicating that you will be completing PSF Bond Guarantee applications). This action will send the MAC an email instructing them to give you access to the application. 
  • If you do not currently have an account, the link will first take you to a page to create an account (at no charge). On the succeeding page, click the Please enable my account button. This action will send the MAC an email instructing them to give you access to the application. 

Once you have been granted access to the application, you will see a link for the PSF application under My MAC (on the left side of the page). Click on that link to begin the process.

  1. Click Create New Application.
  2. Review the application requirements.
  3. Click Begin PSF Application.
  4. Complete the application as instructed by the system.

If you have any questions about the online application process, please send an email to the MAC at or call Laura Slaughter or Terrence Spencer at (512) 476-6947. 


Applications for New or Combination Issues 

Applications for new or combination (new and refunding) issues are subject to a monthly prioritization system in accordance with SBOE rules. Applications that are received on or before 5:00 p.m. of the last business day of the calendar month will be held until the fifteenth business day of the subsequent month. The commissioner of education announces the results of the prioritization on this day each month.

Each district or charter that submits a valid application will be notified of the application status on the fifteenth business day of the month that follows the application deadline.

If a district does not receive a guarantee, the commissioner will consider the application withdrawn. The TEA will not retain applications that were denied a guarantee. However, a district or charter may reapply for a guarantee in a subsequent month.

If the guarantee is granted, but the bonds are not approved by the Office of the Attorney General within 180 days of the application deadline, the commissioner will consider the application withdrawn.


Applications for Refunding Bonds with Present Value Savings

Applications for refunding bonds with present value savings (that refund previously guaranteed bonds) require a separate application form and are not subject to the monthly prioritization system.


Information for Charter Schools

Percentage of Students in Open-Enrollment Charters

19 Texas Administrative Code 33.67(d)(1) requires the commissioner of education to post information each year stating the percentage of students enrolled in charter schools. This information is used to calculate the available capacity of the Permanent School Fund to guarantee bonds for charter schools. Charter schools enrolled 271,973 (5.10%) out of a total enrollment of 5,329,314 students in the 2016–2017 school year.* As a result, we will use 5.10% of total available capacity of the bond guarantee program for charter school guarantees beginning with the February 2017 round.

* Per statute, these numbers are based on enrollment data submitted by school districts and charter schools to the Public Information Management System (PEIMS) during the fall 2016 submission

Payments for Remittance to Charter District Bond Guarantee Reserve Fund

Texas Education Code (TEC) §45.0571 authorizes the commissioner to establish rules related to the Charter District Bond Guarantee Reserve Fund. Those rules are established in 19 TAC Chapter 33, Subchapter AA §33.1001.

The amount to be remitted is based on the savings to the issuer as a result of being able to access the guarantee. Ten percent of the interest rate savings multiplied by the principal amount of the bonds issued is to be remitted to the fund.

The formula for calculation of the amount to be remitted to the fund is Principal (P) x Savings (S) x 0.1 where P is the outstanding principal amount of the bonds either at closing or on the anniversary date of closing, whichever is applicable and S is the savings to the charter based on a calculation of market indexes explained in the rule.

The rule states that the commissioner will semi-annually compute the value of “S” and post it to the agency’s website in March and September of the applicable state fiscal year. The value of “S” effective beginning March 2017 is 0.009819 (.9819%).


 Bond Resources


For additional information, contact:

Division of State Funding
Cassie Huggins
(512) 463-9232