By Lewis H.B. No. 2181
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the creation of a state trust fund and its operational
1-3 authority for providing financial assistance to political
1-4 subdivisions for environmental and natural resource public works
1-5 projects.
1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-7 SECTION 1. That a new chapter 466, Government Code, is
1-8 created to read as follows:
1-9 CHAPTER 466. TEXAS ENVIRONMENTAL AND NATURAL RESOURCES TRUST
1-10 FUND AUTHORITY
1-11 SUBCHAPTER A. GENERAL PROVISIONS
1-12 Section 466.001. Legislative Purpose and Policy.
1-13 (a) The legislature declares that it is the policy of the
1-14 state to:
1-15 (1) encourage and assist in the conservation and
1-16 development of the water resources of the state for the useful and
1-17 lawful purposes by the acquisition, improvement, extension, or
1-18 construction of water resource and water quality public works
1-19 projects;
1-20 (2) aid in the protection of the quality of the water
1-21 resources of the state by encouraging and assisting in the
1-22 financing of water quality enhancement projects;
1-23 (3) encourage the optimum development of feasible
2-1 sites available for the construction of or enlargement of dams and
2-2 reservoirs for the use and benefit of the public and development of
2-3 water storage facilities and systems or works necessary for
2-4 filtration, treatment, and transportation of water;
2-5 (4) aid in flood control, drainage, subsidence
2-6 control, recharge, chloride control, agriculture soil and water
2-7 conservation and desalinization.
2-8 (b) The legislature finds that existing mechanisms for
2-9 implementing the policies stated in Subsection (a) of this section
2-10 may be enhanced by financing as provided by this chapter.
2-11 (c) The legislature finds that to enhance the ability of the
2-12 state to aid in the accomplishment of the purposes stated in
2-13 Subsection (a) of this section, it is necessary to create an
2-14 environmental and natural resources trust fund authority for the
2-15 purpose of increasing the availability of financing by providing
2-16 loans and grants to political subdivisions and the legislature
2-17 declares that the creation of the authority for this purpose is a
2-18 public purpose and a use for which public money may be borrowed,
2-19 spent, advanced, loaned, granted, or appropriated, and that this
2-20 use serves a public purpose in improving or otherwise benefitting
2-21 the people of this state. Also, the legislature determines and
2-22 declares the necessity of enacting this chapter is in the public
2-23 interest.
2-24 Section 466.002. Definitions.
2-25 In this chapter:
3-1 (1) "Authority" means the Texas Environmental and
3-2 Natural Resources Trust Fund Authority.
3-3 (2) "Bond" includes a note, draft, warrant, debenture,
3-4 certificate, bond anticipation note or other evidence of
3-5 indebtedness.
3-6 (3) "Board" means the governing board of the
3-7 authority.
3-8 (4) "Lender" means a lending institution, including a
3-9 bank, trust company, banking association, savings and loan
3-10 association, mortgage company, investment bank, credit union, life
3-11 insurance company, governmental agency that customarily provides
3-12 financing, bond insurance company, or an affiliate of any of those
3-13 entities.
3-14 (5) "Authorized investments" means loans, grants,
3-15 guarantees, or other financial assistance or transactions to
3-16 acquire, construct, reconstruct, enlarge, improve, furnish, equip,
3-17 maintain, repair, operate, lease or rent to, or contract for
3-18 operation by, a political subdivision of the state, including state
3-19 agencies, bureaus, divisions or commissions, for projects for water
3-20 resource development and conservation, water quality including
3-21 municipal solid waste disposal, flood control, drainage, subsidence
3-22 control, recharge, chloride control, agricultural soil and water
3-23 conservation, desalinization, or any combination of these purposes.
3-24 (6) "Equity" means cash or other assets that have no
3-25 liability or obligations attached thereto.
4-1 (7) "Federal agency" means the United States, the
4-2 president or a department of the United States, or a corporation,
4-3 agency, or instrumentality designated or established by the United
4-4 States.
4-5 (8) "Fund" means the Texas environmental and natural
4-6 resources trust fund.
4-7 (9) "Project" means any endeavor over which a state or
4-8 federal regulatory agency exerts its jurisdiction and for which a
4-9 permit is required before initiation of the endeavor.
4-10 (10) "Regulatory agency" means an agency, bureau,
4-11 department, division, or commission of the state or federal
4-12 government or other agency of a political subdivision that
4-13 processes and issues permits.
4-14 (11) "Permit" means a license, certificate, approval,
4-15 registration, consent, permit, or other form of authorization
4-16 required by law, rule, regulation, or ordinance that must be
4-17 obtained by a political subdivision in order to perform an action
4-18 or initiate a project for which a permit is sought.
4-19 (12) "Trust fund revenues" means those funds
4-20 authorized by the legislature for use by the authority.
4-21 (13) "Political subdivision" means a city, county, or
4-22 other body politic or corporate of the state, including any
4-23 district or authority created under Article, Section 52, or Article
4-24 XV, Section 59, of the Texas Constitution, a state agency, an
4-25 entity created by an interstate compact to which the state is a
5-1 party, any nonprofit water supply corporation created and operated
5-2 under Chapter 76, Acts of the 43rd Legislature, 1st Called Session,
5-3 1933 (Article 1434a, Vernon's Texas Civil Statutes) and including
5-4 the Texas Environmental and Natural Resources Trust Fund Authority.
5-5 SUBCHAPTER B. ADMINISTRATIVE PROVISIONS
5-6 Section 466.011. Creation of the Authority.
5-7 (a) The Texas Environmental and Natural Resources Trust Fund
5-8 Authority is created as a governmental entity and a body politic
5-9 and corporate.
5-10 (b) The exercise of the powers and duties by the authority
5-11 under this chapter constitutes an essential public purpose of the
5-12 state in promoting the general welfare of the state and its
5-13 citizens.
5-14 Section 466.012. Board of Directors
5-15 (a) The authority is governed by a board of directors
5-16 composed nine members appointed by the governor with the advice and
5-17 consent of the senate.
5-18 (b) A member must be a resident of the state at the time of
5-19 appointment.
5-20 (c) At least two members must be individuals who have
5-21 investment banking experience as either an underwriter or financial
5-22 advisor, at least two members who must be either elected or
5-23 employed by a city, county, district or authority, and at least two
5-24 members who have engineering experience. To the extent possible,
5-25 the members should represent all geographic areas of the state.
6-1 (d) Members serve staggered six-year terms with the terms of
6-2 three members expiring February 1 of each odd-numbered year.
6-3 (e) On the death, resignation, or other inability of a
6-4 member to serve, the governor shall appoint a successor to serve
6-5 the remainder of the unexpired term.
6-6 Section 466.013. Compensation; Reimbursement.
6-7 The directors are not entitled to receive compensation for
6-8 their service on the board but are entitled to be reimbursed for
6-9 their expenses in performing their powers and duties under this
6-10 chapter.
6-11 Section 466.014. Organization of the Board
6-12 (a) Board shall select from its membership a chairman and
6-13 vice-chairman.
6-14 (b) The chairman shall preside at meetings of the board and
6-15 perform other duties directed by the board. The vice-chairman
6-16 shall preside at meetings of the board in the absence of the
6-17 chairman.
6-18 (c) The board shall select persons to serve as secretary and
6-19 treasurer for the authority. These persons selected are not
6-20 required to be members of the board and both positions may be held
6-21 by one person. The board may appoint assistant secretaries.
6-22 (d) The secretary is the custodian of the minutes, books,
6-23 records, and seal of the board, and the secretary and the treasurer
6-24 shall perform duties as directed by the board.
6-25 (e) The chairman, vice-chairman, secretary, and treasurer
7-1 shall be selected by the board at the first meeting of the board
7-2 following the second Tuesday of January of each odd-numbered year.
7-3 Section 466.015. Board Meetings
7-4 (a) The board shall hold regular meetings at times provided
7-5 by its rules and shall meet at least once each calender year.
7-6 (b) The board may hold special meetings at the call of the
7-7 chairman or on request of five or more board members.
7-8 Section 466.016. Rules and Resolutions
7-9 The board may adopt rules that are necessary to carry out
7-10 this chapter and may take official action by adoption of a
7-11 resolution or order.
7-12 Section 466.017. Liability
7-13 A director or officer of the authority is not liable for any
7-14 bonds issued or contracts executed by the authority.
7-15 Section 466.018. General Fiscal Authority
7-16 The board may acquire, hold, invest, and reinvest in
7-17 authorized investments, deposit, use, and dispose of the
7-18 authority's revenues, income, receipts, funds, and money from every
7-19 source and may select its depository or depositories, inside or
7-20 outside the state, subject only to this chapter and any covenants
7-21 with respect to the authority's bonds.
7-22 Section 466.019. Property Tax Exempt
7-23 (a) The property of the authority, its income, and its
7-24 operations are exempt from all taxes and assessments imposed by the
7-25 state and political subdivisions on property acquired or used by
8-1 the authority under this chapter.
8-2 (b) If the authority is dissolved, all of its rights and
8-3 properties vest in the state.
8-4 Section 466.020. Fiscal Year; Annual Audit
8-5 (a) The authority shall operate on a fiscal year beginning
8-6 September 1.
8-7 (b) The board shall have an audit made by a certified public
8-8 accountant or by the state auditor of all the authority's books and
8-9 accounts for each fiscal year. The cost of the audit shall be paid
8-10 by the authority.
8-11 (c) A copy of the audit shall be filed with the governor and
8-12 with both houses of the legislature on or before January 1 of each
8-13 year.
8-14 Section 466.021. Authority Expenses
8-15 (a) Expenses incurred by the authority under this Act shall
8-16 be paid solely from revenues or funds provided or to be provided
8-17 under this chapter.
8-18 (b) This chapter may not be construed to authorize the
8-19 authority to incur any indebtedness or liability on behalf of or
8-20 payable by the state.
8-21 (c) The board shall use all available sources of revenue and
8-22 income to pay expenses of operation and maintenance of the
8-23 authority, to pay the premium, principal of and interest on bonds,
8-24 to create and maintain any reserves of funds provided by
8-25 resolutions authorizing the issuance of bonds, and for any other
9-1 activities under this chapter.
9-2 Section 466.022. Suits
9-3 The authority may sue and be sued in the courts of this state
9-4 in the name of the authority, and the courts shall take judicial
9-5 notice of the creation of the authority.
9-6 Section 466.023. Seal
9-7 The board may adopt a seal for the authority.
9-8 Section 466.024. General Powers and Duties
9-9 The authority may exercise any authority necessary or
9-10 appropriate to carry out the purposes of this chapter including the
9-11 power of eminent domain to acquire real property, easements, or
9-12 other property or interests in real property, easements, or other
9-13 property, including fee simple interests with respect to the
9-14 entirety of any real property, fee simple interests with respect to
9-15 specified subsurface portions of any real property, and any lesser
9-16 interests, as determined by the authority to be necessary or
9-17 convenient to further the purposes of the authority in the manner
9-18 described by Chapter 21, Property Code. The authority and its
9-19 agents, employes, contractors, subcontractors, and designees may
9-20 enter on any land to make surveys, perform core
9-21 drilling-operations, or conduct other tests and evaluations with
9-22 respect to the surface and subsurface of the lands as the
9-23 authority, its agents, employees, contractors, subcontractors, or
9-24 designees consider necessary or convenient to further the purposes
9-25 of the authority.
10-1 Section 466.025 Gifts, Grants, Etc.
10-2 The board may request and accept for the authority grants,
10-3 allocations, subsidies, guarantees, aid, contributions, services,
10-4 labor, materials, gifts, and donations.
10-5 Section 466.026. Contracts
10-6 The board on behalf of the authority may enter into contracts
10-7 with any person to carry out this chapter.
10-8 Section 466.027 Purchase of Insurance.
10-9 The board may purchase for the authority and pay premiums on
10-10 insurance of any type, in any amounts, and from any insurers the
10-11 board considers advisable.
10-12 Section 466.028 Financial Assistance.
10-13 The authority may use trust fund revenues for all authorized
10-14 investments of political subdivisions.
10-15 SUBCHAPTER C. BONDS
10-16 Section 466.031 Issuance of Bonds
10-17 For the issuance of bonds under this chapter, the board may
10-18 exercise the authority granted to the governing body of an issuer
10-19 with regard to issuance of obligations under Chapter 656, Acts of
10-20 the 68th Legislature, Regular Session, 1983 (Article 717q, Vernon's
10-21 Texas Civil Statutes) to the extent that it is not inconsistent
10-22 with this chapter.
10-23 Section 466.032. Conditions for Issuance of Bonds.
10-24 (a) Bonds may be issued as various series and issues.
10-25 (b) Bonds issued by the authority may mature serially or
11-1 otherwise not later than 50 years after the date on which they are
11-2 issued.
11-3 (c) The bonds may bear interest at a rate or rates
11-4 determined in accordance with the resolution or order authorizing
11-5 the issuance of the bonds but not to exceed the net effective
11-6 interest rate authorized by Chapter 3, Acts of the 61st
11-7 Legislature, Regular Session, 1969 (Article 717d-2, Vernon's Texas
11-8 Civil Statutes).
11-9 (d) Rates of interest on bonds may be fixed, variable,
11-10 floating, adjustable, or otherwise.
11-11 Section 466.033. Security Qualifications
11-12 The board may take any action necessary to qualify the
11-13 authority bonds for offer and sale under the securities laws and
11-14 regulations of the United States, this state, and other states of
11-15 the United States.
11-16 Section 466.034. Investment Securities.
11-17 The bonds and any interest coupons are investment securities
11-18 under Chapter 8, Business & Commerce Code, and may be issued
11-19 registrable as to principal or as to both principal and interest or
11-20 may be redeemable before maturity at the option of the authority or
11-21 may contain a mandatory redemption provision.
11-22 Section 466.035. Form of Bonds
11-23 (a) The authority's bonds may be issued in the form,
11-24 denominations, and manner and under the terms, conditions, and
11-25 details as provided by the board in the resolution or order
12-1 authorizing their issuance.
12-2 (b) The bonds shall be signed and executed as provided by
12-3 the board's resolution or order authorizing the issuance of the
12-4 bonds.
12-5 Section 466.036. Funds
12-6 (a) In the resolution or order authorizing issuance of
12-7 bonds, the board may make additional covenants with respect to the
12-8 bonds and the pledged revenues and may provide for the flow of
12-9 funds and the establishment, maintenance, and investment of funds.
12-10 (b) The funds established may include an interest and
12-11 sinking fund, a reserve fund, and other funds that will be kept and
12-12 maintained by or under the direction of the board.
12-13 (c) Any funds established by the board are not to be a part
12-14 of the state treasury but, at the direction of the board, may be
12-15 kept and held in escrow and in trust by the state treasury on
12-16 behalf of the authority and the owners of the bonds and used only
12-17 as provided by this chapter.
12-18 (d) Money and funds shall be invested in authorized
12-19 investments as provided by any bond resolutions and orders of the
12-20 authority.
12-21 (e) Legal title in any fund is in the authority unless or
12-22 until paid from the fund as provided for by this chapter or the
12-23 resolutions or orders authorizing the bonds.
12-24 Section 466.037. Resolutions and Orders.
12-25 (a) The orders or resolutions of the board issuing bonds may
13-1 include those provisions and covenants that the board deems
13-2 necessary.
13-3 (b) In a resolution or order authorizing the issuance of the
13-4 authority's bonds, the board may prescribe systems, methods,
13-5 routines, and procedures under which the authority will function.
13-6 (c) The board may adopt and have executed any other
13-7 proceedings or instruments necessary and convenient in the issuance
13-8 of bonds.
13-9 Section 466.038. Refunding Bonds.
13-10 (a) The board may issue refunding bonds to refund all or
13-11 part of its outstanding bonds issued under this chapter, including
13-12 matured but unpaid interest.
13-13 (b) The board may refund bonds in the manner provided by
13-14 general law for revenue bonds.
13-15 Section 466.039. Legal Investment.
13-16 The bonds are legal and authorized investments for banks,
13-17 savings banks, trust companies, savings and loan associations,
13-18 insurance companies, fiduciaries, trustees, guardians, and sinking
13-19 funds of cities, counties, school districts, and other political
13-20 subdivisions of the state and other public funds of the state and
13-21 its agencies, including the permanent school fund.
13-22 Section 466.040. Tax Exempt.
13-23 The bonds issued under this Act, and the interest and income
13-24 from the bonds, and all fees, charges, gifts, grants, revenues,
13-25 receipts, and other money received or pledged to pay or secure the
14-1 payment of bonds are free from taxation and assessments of every
14-2 kind by this state and any city, county, district, authority, or
14-3 other political subdivision of this state.
14-4 Section 466.041. Pledge of State Faith and Credit; Covenant
14-5 With Owners of Bonds.
14-6 (a) The authority's bonds are obligations solely of the
14-7 authority and are payable solely from funds of the authority, and
14-8 this chapter and the authority's bonds are not and do not create or
14-9 constitute a pledge, giving, or lending of the faith or credit or
14-10 taxing authority of the state.
14-11 (b) Each bond of the authority must include a statement that
14-12 the state is not obligated to pay the premium, the principal of, or
14-13 interest on the authority's bonds and that the faith or credit and
14-14 the taxing authority of the state is not pledged, given, or loaned
14-15 to those payments.
14-16 (c) The state pledges to and agrees with the owners of any
14-17 bonds issued in accordance with this chapter that the state will
14-18 not limit or alter the rights vested in the authority to fulfill
14-19 the terms of any agreements made with the owners of the bonds or in
14-20 any way impair the rights and remedies of those owners until the
14-21 bonds, together with any premium and interest, interest on any
14-22 unpaid premium or installments of interest, and all costs and
14-23 expenses in connection with any action or proceeding by or on
14-24 behalf of those owners, are fully met and discharged. The
14-25 authority may include this pledge and agreement of the state in any
15-1 agreement with the owners of the bonds.
15-2 SECTION 2. The importance of this legislation and the
15-3 crowded condition of the calenders in both houses create an
15-4 emergency and an imperative public necessity that the
15-5 constitutional rule requiring bills to be read on three several
15-6 days in each house be suspended, and this rule is hereby suspended,
15-7 and that this Act take effect and be in force from and after its
15-8 passage, and it is so enacted.