By: Denton H.B. No. 2787
73R1551 JRD-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to enabling the General Services Commission to purchase an
1-3 existing building through Texas Public Finance Authority financing
1-4 under certain circumstances.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Article 5, State Purchasing and General Services
1-7 Act (Article 601b, Vernon's Texas Civil Statutes), is amended by
1-8 adding Section 5.342 to read as follows:
1-9 Sec. 5.342. ACQUISITION OF EXISTING BUILDING AS ALTERNATIVE
1-10 TO LEASING SPACE. (a) This section applies only to meeting office
1-11 space needs of one or more state agencies in a county in which the
1-12 state is leasing at least 50,000 square feet of usable office
1-13 space.
1-14 (b) The commission may meet office space needs of one or
1-15 more state agencies that are being met through leased space by
1-16 purchasing one or more existing buildings in accordance with this
1-17 section. The purchase of a building may include the purchase of
1-18 the building's grounds and related improvements. The purchase of a
1-19 building under this section must be:
1-20 (1) financed through bonds issued by the Texas Public
1-21 Finance Authority; and
1-22 (2) approved by the legislature if it is in session or
1-23 by the Legislative Budget Board if the legislature is not in
1-24 session.
2-1 (c) The commission may purchase a building under this
2-2 section only if the commission determines that the projected annual
2-3 total space occupancy costs of the purchased space will not exceed,
2-4 over the term of the bonded indebtedness, the projected annual
2-5 total space occupancy costs of meeting the same space needs through
2-6 leased space. In this section, "total space occupancy costs"
2-7 include:
2-8 (1) for leased space, the direct cost of the lease
2-9 payments for the space;
2-10 (2) for purchased space, the direct cost of rental or
2-11 installment payments for the space under Section 12(b), Texas
2-12 Public Finance Authority Act (Article 601d, Vernon's Texas Civil
2-13 Statutes);
2-14 (3) the cost of any necessary renovations;
2-15 (4) operating costs, including janitorial and utility
2-16 costs; and
2-17 (5) for purchased space, the cost of maintaining a
2-18 cash replacement reserve sufficient to service structural
2-19 maintenance requirements reflecting the expected performance life
2-20 of the major capital expense items of the building for the term of
2-21 the bonded indebtedness.
2-22 (d) If the commission has made the necessary determination
2-23 under Subsection (c) of this section and the purchase has been
2-24 approved by the legislature or the Legislative Budget Board under
2-25 Subsection (b) of this section, the Texas Public Finance Authority
2-26 shall issue and sell bonds to finance the purchase in accordance
2-27 with the Texas Public Finance Authority Act (Article 601d, Vernon's
3-1 Texas Civil Statutes), and the commission may purchase the building
3-2 in accordance with that Act and other applicable law. The
3-3 limitation prescribed by Section 9, Texas Public Finance Authority
3-4 Act (Article 601d, Vernon's Texas Civil Statutes), relating to the
3-5 location of a building for which bonds may be issued and sold does
3-6 not apply to financing the purchase of a building under this
3-7 section.
3-8 (e) Any person from whom real property or any existing
3-9 buildings or other improvements are purchased under this section
3-10 shall provide to the commission the name and the last known address
3-11 of each person who:
3-12 (1) owns record legal title to the property,
3-13 buildings, or other improvements; or
3-14 (2) owns a beneficial interest in the property,
3-15 buildings, or other improvements through a trust, nominee, agent,
3-16 or any other legal entity.
3-17 (f) When a state agency vacates leased space to move into
3-18 space in a building purchased under this section or when the leased
3-19 space itself is purchased under this section, the money
3-20 specifically appropriated by the legislature or the money available
3-21 to and budgeted by the agency for lease payments for the leased
3-22 space for the remainder of the biennium may be used only for rental
3-23 or installment payments for the purchased space under Section
3-24 12(b), Texas Public Finance Authority Act (Article 601d, Vernon's
3-25 Texas Civil Statutes), and for the payment of operating expenses
3-26 for the purchased space that are incurred by the commission. The
3-27 comptroller may adopt rules for the administration of this
4-1 subsection.
4-2 SECTION 2. Sections 4.15(c) and (m), State Purchasing and
4-3 General Services Act (Article 601b, Vernon's Texas Civil Statutes),
4-4 are amended to read as follows:
4-5 (c) Except as provided by this section and Article 6252-3e,
4-6 Revised Statutes, the commission shall determine the amount of
4-7 space in a building to be allocated to private tenants and the
4-8 types of activities in which the tenants may engage based on the
4-9 market for certain activities among employees and visitors in the
4-10 building and in the vicinity of the building. Except as provided
4-11 by Subsection (m) <(l)> of this section, the amount of space
4-12 allocated to private tenants may not exceed 15 percent of the total
4-13 space in the building. Any space leased to provide child care
4-14 services for state employees shall not be counted in the 15 percent
4-15 maximum.
4-16 (m) If the commission determines under Section 5.34 or 5.342
4-17 of this Act that the purchase of an existing building is more
4-18 advantageous to the state than constructing <the construction of> a
4-19 new building or continuing to lease space for a state agency, but a
4-20 purchase of the building would be subject to existing leases to
4-21 private tenants that exceed 15 percent of the total space in the
4-22 building, the commission may purchase the building subject to
4-23 existing leases notwithstanding Subsection (c) of this section.
4-24 When an existing lease to a private tenant expires, the commission
4-25 may renew the lease subject to this section, including Subsection
4-26 (c).
4-27 SECTION 3. Section 9(b), Texas Public Finance Authority Act
5-1 (Article 601d, Vernon's Texas Civil Statutes), is amended to read
5-2 as follows:
5-3 (b) When the acquisition or construction of a building has
5-4 been authorized in accordance with this Act or under Section 5.34
5-5 or 5.342, State Purchasing and General Services Act (Article 601b,
5-6 Vernon's Texas Civil Statutes), the board shall promptly issue and
5-7 sell bonds in the name of the authority under this Act, including
5-8 Sections 10B and 16 of this Act, to finance the acquisition or
5-9 construction of the building. When the proceeds from the bond
5-10 issuance are available, the board shall promptly deposit the
5-11 proceeds in the state treasury under Section 23 of this Act and
5-12 shall promptly make the determinations that are to be made by the
5-13 board under Section 23 of this Act.
5-14 SECTION 4. Subsection (a), Section 10, Texas Public Finance
5-15 Authority Act (Article 601d, Vernon's Texas Civil Statutes), as
5-16 amended by Chapter 1244, Acts of the 71st Legislature, Regular
5-17 Session, 1989, is amended to read as follows:
5-18 (a) Except as permitted by Sections 24A(b)(5) and 24A(d) of
5-19 this Act or Section 5.34 or 5.342, State Purchasing and General
5-20 Services Act (Article 601b, Vernon's Texas Civil Statutes), before
5-21 the board may issue and sell bonds, the legislature by law must
5-22 have authorized in this Act, the General Appropriations Act, or
5-23 another Act the specific project for which the bonds are to be
5-24 issued and sold and must have authorized the estimated cost of the
5-25 project or the maximum amount of bonded indebtedness that may be
5-26 incurred by the issuance and sale of bonds for the project. In
5-27 recognition that the cost estimates for acquisition, construction,
6-1 repair, or renovation of a project will not be final at the time
6-2 the project is authorized for financing and that the bonds may be
6-3 issued to fund associated costs, including but not limited to
6-4 reasonably required reserve funds, capitalized interest,
6-5 administrative costs of the authority, and issuing expenses, the
6-6 principal amount of any bond issue for that purpose may be up to
6-7 1-1/2 the amount of the estimated cost for the project being
6-8 financed. For additional costs to be included in that principal
6-9 amount, the board must affirmatively find that those costs are
6-10 necessary and reasonable at the time the bonds are issued.
6-11 SECTION 5. The importance of this legislation and the
6-12 crowded condition of the calendars in both houses create an
6-13 emergency and an imperative public necessity that the
6-14 constitutional rule requiring bills to be read on three several
6-15 days in each house be suspended, and this rule is hereby suspended,
6-16 and that this Act take effect and be in force from and after its
6-17 passage, and it is so enacted.