By:  Delco                                             H.B. No. 129
       73R616 SOS-F
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the establishment of the University Bonds for the
    1-3  Education of Texans program; authorizing the issuance of special
    1-4  savings certificates.
    1-6        SECTION 1.  Chapter 56, Education Code, is amended by adding
    1-7  Subchapter J to read as follows:
    1-9                            (UBET) PROGRAM
   1-10        Sec. 56.161.  DEFINITIONS.  In this subchapter:
   1-11              (1)  "Bonds" means the special savings certificates
   1-12  authorized under this subchapter.
   1-13              (2)  "Fund" means the UBET fund created in the state
   1-14  treasury by this subchapter.
   1-15              (3)  "Program" means the University Bonds for the
   1-16  Education of Texans (UBET) program established under this
   1-17  subchapter.
   1-18        Sec. 56.162.  ESTABLISHMENT OF PROGRAM; PURPOSE.  The program
   1-19  is established to provide the public with a method of saving in
   1-20  advance for higher education tuition expenses and to encourage
   1-21  enrollment at public and private postsecondary educational
   1-22  institutions.
   1-23        Sec. 56.163.  ADMINISTRATIVE AUTHORITY.  (a)  The state
   1-24  treasurer, as provided by this subchapter, shall administer the
    2-1  program.
    2-2        (b)  The state treasurer may adopt rules necessary to carry
    2-3  out the purposes of this subchapter.
    2-4        (c)  The state treasurer may accept a gift or grant from a
    2-5  public or private source for the purposes of this subchapter.
    2-6        Sec. 56.164.  Issuance And Sale.  (a)  The state treasurer
    2-7  shall issue and sell the bonds in denominations determined by the
    2-8  treasurer, but the face value of a bond may not be less than $50
    2-9  nor more than $100.
   2-10        (b)  A person may not purchase more than one bond a month.
   2-11        (c)  The state treasurer shall execute necessary agreements
   2-12  for the bonds to be available for purchase through payroll
   2-13  deductions.  The bonds shall also be available for purchase
   2-14  directly from the state treasurer.  The bonds may be made available
   2-15  for purchase through other means and at other outlets as determined
   2-16  by the state treasurer.
   2-17        Sec. 56.165.  TERMS.  (a)  Each bond must be issued in the
   2-18  name of a person who is younger than 18 years of age on the date of
   2-19  purchase and must bear that person's name.
   2-20        (b)  A bond will earn interest compounded annually at a rate
   2-21  determined annually by the state treasurer.
   2-22        (c)  The bonds may be sold at a price or under the terms
   2-23  consistent with this subchapter that the state treasurer
   2-24  determines.
   2-25        (d)  To the extent possible, the bonds shall be issued on
   2-26  terms and in a form sufficient for income on the bonds to be exempt
   2-27  from federal income tax.
    3-1        (e)  The bonds do not constitute indebtedness of the state.
    3-2        Sec. 56.166.  UBET FUND.  (a)  A special fund to be known as
    3-3  the UBET fund is created in the state treasury.
    3-4        (b)  The fund consists of proceeds from the sale of the
    3-5  bonds, gifts and grants, and interest earned on investment of the
    3-6  fund.
    3-7        (c)  The state treasurer shall pay expenses of administering
    3-8  this subchapter from the fund.
    3-9        Sec. 56.167.  REDEMPTION.  (a)  The person in whose name a
   3-10  bond is issued and who enrolls in an institution of higher
   3-11  education may redeem the bond on presentation of the bond to the
   3-12  registrar of the institution.  The registrar shall credit 110
   3-13  percent of the value of the bond against any payment for tuition or
   3-14  other fees of the student.  The institution shall mark the bond as
   3-15  redeemed and deliver the bond to the state treasurer.  The state
   3-16  treasurer shall reimburse the institution for the value amount of
   3-17  the bond if sufficient money in the fund exists.  The rules of the
   3-18  state treasurer may provide for reimbursement to occur through
   3-19  electronic funds transfer or other means.
   3-20        (b)  The state treasurer may execute agreements with private
   3-21  postsecondary educational institutions for redemption of bonds in a
   3-22  manner similar to that provided by Subsection (a) of this section.
   3-23  The agreements may provide for redemption at 105 percent of the
   3-24  face amount of the bond and reimbursement at the face amount of the
   3-25  bond if sufficient money in the fund exists.
   3-26        (c)  On attaining age 18, the person in whose name a bond is
   3-27  issued may also redeem the bond on presentation of the bond to the
    4-1  state treasurer in the manner provided by rule of the state
    4-2  treasurer.  If the person in whose name a bond is issued dies
    4-3  before redeeming the bond, the heir or devisee of the person may
    4-4  redeem the bond on presentation to the state treasurer of a death
    4-5  certificate.  On presentation, the state treasurer shall pay the
    4-6  person redeeming the bond the value amount of the bond if
    4-7  sufficient money in the fund exists.
    4-8        Sec. 56.168.  MANDAMUS.  The performance of official duties
    4-9  prescribed by this subchapter, in reference to the payment of the
   4-10  bonds, may be enforced in a court of competent jurisdiction by
   4-11  mandamus or other appropriate proceedings.
   4-12        Sec. 56.169.  REPLACEMENT OF BOND.  The state treasurer may
   4-13  provide for the replacement of any bond that is mutilated, lost, or
   4-14  destroyed.
   4-15        Sec. 56.170.  MANAGEMENT.  Money in the fund shall be
   4-16  invested by the state treasurer in investments authorized for the
   4-17  investment of state funds generally.
   4-18        Sec. 56.171.  EXEMPTION FROM TAXATION.  Bonds issued under
   4-19  this subchapter may not be taxed by the state or any of its
   4-20  political subdivisions.
   4-21        SECTION 2.  This Act takes effect January 1, 1994.
   4-22        SECTION 3.  The importance of this legislation and the
   4-23  crowded condition of the calendars in both houses create an
   4-24  emergency and an imperative public necessity that the
   4-25  constitutional rule requiring bills to be read on three several
   4-26  days in each house be suspended, and this rule is hereby suspended.