By: Sims S.B. No. 1294
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the creation of a state trust fund and its operational
1-2 authority for providing financial assistance to political
1-3 subdivisions for environmental and natural resource public works
1-4 projects.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. That a new chapter 466, Government Code, is
1-7 created to read as follows:
1-8 CHAPTER 466. TEXAS ENVIRONMENTAL AND NATURAL
1-9 RESOURCES TRUST FUND AUTHORITY
1-10 SUBCHAPTER A. GENERAL PROVISIONS
1-11 Sec. 466.001. LEGISLATIVE PURPOSE AND POLICY. (a) The
1-12 legislature declares that it is the policy of the state to:
1-13 (1) encourage and assist in the conservation and
1-14 development of the water resources of the state for the useful and
1-15 lawful purposes by the acquisition, improvement, extension, or
1-16 construction of water resource and water quality public works
1-17 projects;
1-18 (2) aid in the protection of the quality of the water
1-19 resources of the state by encouraging and assisting in the
1-20 financing of water quality enhancement projects;
1-21 (3) encourage the optimum development of feasible
1-22 sites available for the construction of or enlargement of dams and
1-23 reservoirs for the use and benefit of the public and development of
2-1 water storage facilities and systems or works necessary for
2-2 filtration, treatment, and transportation of water;
2-3 (4) aid in flood control, drainage, subsidence
2-4 control, recharge, chloride control, agriculture soil and water
2-5 conservation and desalinization.
2-6 (b) The legislature finds that existing mechanisms for
2-7 implementing the policies stated in Subsection (a) of this section
2-8 may be enhanced by financing as provided by this chapter.
2-9 (c) The legislature finds that to enhance the ability of the
2-10 state to aid in the accomplishment of the purposes stated in
2-11 Subsection (a) of this section, it is necessary to create an
2-12 environmental and natural resources trust fund authority for the
2-13 purpose of increasing the availability of financing by providing
2-14 loans and grants to political subdivisions and the legislature
2-15 declares that the creation of the authority for this purpose is a
2-16 public purpose and a use for which public money may be borrowed,
2-17 spent, advanced, loaned, granted, or appropriated, and that this
2-18 use serves a public purpose in improving or otherwise benefitting
2-19 the people of this state. Also, the legislature determines and
2-20 declares the necessity of enacting this chapter is in the public
2-21 interest.
2-22 Sec. 466.002. DEFINITIONS. In this chapter:
2-23 (1) "Authority" means the Texas Environmental and
2-24 Natural Resources Trust Fund Authority.
2-25 (2) "Bond" includes a note, draft, warrant, debenture,
3-1 certificate, bond anticipation note or other evidence of
3-2 indebtedness.
3-3 (3) "Board" means the governing board of the
3-4 authority.
3-5 (4) "Lender" means a lending institution, including a
3-6 bank, trust company, banking association, savings and loan
3-7 association, mortgage company, investment bank, credit union, life
3-8 insurance company, governmental agency that customarily provides
3-9 financing, bond insurance company, or an affiliate of any of those
3-10 entities.
3-11 (5) "Authorized investments" means loans, grants,
3-12 guarantees, or other financial assistance or transactions to
3-13 acquire, construct, reconstruct, enlarge, improve, furnish, equip,
3-14 maintain, repair, operate, lease or rent to, or contract for
3-15 operation by, a political subdivision of the state, including state
3-16 agencies, bureaus, divisions, or commissions, for projects for
3-17 water resource development and conservation, water quality
3-18 including municipal solid waste disposal, flood control, drainage,
3-19 subsidence control, recharge, chloride control, agricultural soil
3-20 and water conservation, desalinization, or any combination of these
3-21 purposes.
3-22 (6) "Equity" means cash or other assets that have no
3-23 liability or obligations attached thereto.
3-24 (7) "Federal agency" means the United States, the
3-25 president or a department of the United States, or a corporation,
4-1 agency, or instrumentality designated or established by the United
4-2 States.
4-3 (8) "Fund" means the Texas environmental and natural
4-4 resources trust fund.
4-5 (9) "Project" means any endeavor over which a state or
4-6 federal regulatory agency exerts its jurisdiction and for which a
4-7 permit is required before initiation of the endeavor.
4-8 (10) "Regulatory agency" means an agency, bureau,
4-9 department, division, or commission of the state or federal
4-10 government or other agency of a political subdivision that
4-11 processes and issues permits.
4-12 (11) "Permit" means a license, certificate, approval,
4-13 registration, consent, permit, or other form of authorization
4-14 required by law, rule, regulation, or ordinance that must be
4-15 obtained by a political subdivision in order to perform an action
4-16 or initiate a project for which a permit is sought.
4-17 (12) "Trust fund revenues" means those funds
4-18 authorized by the legislature for use by the authority.
4-19 (13) "Political subdivision" means a city, county, or
4-20 other body politic or corporate of the state, including any
4-21 district or authority created under Article 3, Section 52, or
4-22 Article XVI, Section 59, of the Texas Constitution, a state agency,
4-23 an entity created by an interstate compact to which the state is a
4-24 party, any nonprofit water supply corporation created and operated
4-25 under Chapter 76, Acts of the 43rd Legislature, 1st Called Session,
5-1 1933 (Article 1434a, Vernon's Texas Civil Statutes) and including
5-2 the Texas Environmental and Natural Resources Trust Fund Authority.
5-3 SUBCHAPTER B. ADMINISTRATIVE PROVISIONS
5-4 Sec. 466.011. CREATION OF THE AUTHORITY. (a) The Texas
5-5 Environmental and Natural Resources Trust Fund Authority is created
5-6 as a governmental entity and a body politic and corporate.
5-7 (b) The exercise of the powers and duties by the authority
5-8 under this chapter constitutes an essential public purpose of the
5-9 state in promoting the general welfare of the state and its
5-10 citizens.
5-11 Sec. 466.012. BOARD OF DIRECTORS. (a) The authority is
5-12 governed by a board of directors composed of nine members appointed
5-13 by the governor with the advice and consent of the senate.
5-14 (b) A member must be a resident of the state at the time of
5-15 appointment.
5-16 (c) At least two members must be individuals who have
5-17 investment banking experience as either an underwriter or financial
5-18 advisor, at least two members who must be either elected or
5-19 employed by a city, county, district or authority, and at least two
5-20 members who have engineering experience. To the extent possible,
5-21 the members should represent all geographic areas of the state.
5-22 (d) Members serve staggered six-year terms with the terms of
5-23 three members expiring February 1 of each odd-numbered year.
5-24 (e) On the death, resignation, or other inability of a
5-25 member to serve, the governor shall appoint a successor to serve
6-1 the remainder of the unexpired term.
6-2 Sec. 466.013. COMPENSATION; REIMBURSEMENT. The directors
6-3 are not entitled to receive compensation for their service on the
6-4 board but are entitled to be reimbursed for their expenses in
6-5 performing their powers and duties under this chapter.
6-6 Sec. 466.014. ORGANIZATION OF THE BOARD. (a) Board shall
6-7 select from its membership a chairman and vice-chairman.
6-8 (b) The chairman shall preside at meetings of the board and
6-9 perform other duties directed by the board. The vice-chairman
6-10 shall preside at meetings of the board in the absence of the
6-11 chairman.
6-12 (c) The board shall select persons to serve as secretary and
6-13 treasurer for the authority. These persons selected are not
6-14 required to be members of the board and both positions may be held
6-15 by one person. The board may appoint assistant secretaries.
6-16 (d) The secretary is the custodian of the minutes, books,
6-17 records, and seal of the board, and the secretary and the treasurer
6-18 shall perform duties as directed by the board.
6-19 (e) The chairman, vice-chairman, secretary, and treasurer
6-20 shall be selected by the board at the first meeting of the board
6-21 following the second Tuesday of January of each odd-numbered year.
6-22 Sec. 466.015. BOARD MEETINGS. (a) The board shall hold
6-23 regular meetings at times provided by its rules and shall meet at
6-24 least once each calendar year.
6-25 (b) The board may hold special meetings at the call of the
7-1 chairman or on request of five or more board members.
7-2 Sec. 466.016. RULES AND RESOLUTIONS. The board may adopt
7-3 rules that are necessary to carry out this chapter and may take
7-4 official action by adoption of a resolution or order.
7-5 Sec. 466.017. LIABILITY. A director or officer of the
7-6 authority is not liable for any bonds issued or contracts executed
7-7 by the authority.
7-8 Sec. 466.018. GENERAL FISCAL AUTHORITY. The board may
7-9 acquire, hold, invest, and reinvest in authorized investments,
7-10 deposit, use, and dispose of the authority's revenues, income,
7-11 receipts, funds, and money from every source and may select its
7-12 depository or depositories, inside or outside the state, subject
7-13 only to this chapter and any covenants with respect to the
7-14 authority's bonds.
7-15 Sec. 466.019. PROPERTY TAX EXEMPT. (a) The property of the
7-16 authority, its income, and its operations are exempt from all taxes
7-17 and assessments imposed by the state and political subdivisions on
7-18 property acquired or used by the authority under this chapter.
7-19 (b) If the authority is dissolved, all of its rights and
7-20 properties vest in the state.
7-21 Sec. 466.020. FISCAL YEAR; ANNUAL AUDIT. (a) The authority
7-22 shall operate on a fiscal year beginning September 1.
7-23 (b) The board shall have an audit made by a certified public
7-24 accountant or by the state auditor of all the authority's books and
7-25 accounts for each fiscal year. The cost of the audit shall be paid
8-1 by the authority.
8-2 (c) A copy of the audit shall be filed with the governor and
8-3 with both houses of the legislature on or before January 1 of each
8-4 year.
8-5 Sec. 466.021. AUTHORITY EXPENSES. (a) Expenses incurred by
8-6 the authority under this Act shall be paid solely from revenues or
8-7 funds provided or to be provided under this chapter.
8-8 (b) This chapter may not be construed to authorize the
8-9 authority to incur any indebtedness or liability on behalf of or
8-10 payable by the state.
8-11 (c) The board shall use all available sources of revenue and
8-12 income to pay expenses of operation and maintenance of the
8-13 authority, to pay the premium, principal of and interest on bonds,
8-14 to create and maintain any reserves or funds provided by
8-15 resolutions authorizing the issuance of bonds, and for any other
8-16 activities under this chapter.
8-17 Sec. 466.022. SUITS. The authority may sue and be sued in
8-18 the courts of this state in the name of the authority, and the
8-19 courts shall take judicial notice of the creation of the authority.
8-20 Sec. 466.023. SEAL. The board may adopt a seal for the
8-21 authority.
8-22 Sec. 466.024. GENERAL POWERS AND DUTIES. The authority may
8-23 exercise any authority necessary or appropriate to carry out the
8-24 purposes of this chapter including the power of eminent domain to
8-25 acquire real property, easements, or other property or interests in
9-1 real property, easements, or other property, including fee simple
9-2 interests with respect to the entirety of any real property, fee
9-3 simple interests with respect to specified subsurface portions of
9-4 any real property, and any lesser interests, as determined by the
9-5 authority to be necessary or convenient to further the purposes of
9-6 the authority in the manner described by Chapter 21, Property Code.
9-7 The authority and its agents, employees, contractors,
9-8 subcontractors, and designees may enter on any land to make
9-9 surveys, perform core drilling-operations, or conduct other tests
9-10 and evaluations with respect to the surface and subsurface of the
9-11 lands as the authority, its agents, employees, contractors,
9-12 subcontractors, or designees consider necessary or convenient to
9-13 further the purposes of the authority.
9-14 Sec. 466.025. GIFTS, GRANTS, ETC. The board may request and
9-15 accept for the authority grants, allocations, subsidies,
9-16 guarantees, aid, contributions, services, labor, materials, gifts,
9-17 and donations.
9-18 Sec. 466.026. CONTRACTS. The board on behalf of the
9-19 authority may enter into contracts with any person to carry out
9-20 this chapter.
9-21 Sec. 466.027. PURCHASE OF INSURANCE. The board may purchase
9-22 for the authority and pay premiums on insurance of any type, in any
9-23 amounts, and from any insurers the board considers advisable.
9-24 Sec. 466.028. FINANCIAL ASSISTANCE. The authority may use
9-25 trust fund revenues for all authorized investments of political
10-1 subdivisions.
10-2 SUBCHAPTER C. BONDS
10-3 Sec. 466.031. ISSUANCE OF BONDS. For the issuance of bonds
10-4 under this chapter, the board may exercise the authority granted to
10-5 the governing body of an issuer with regard to issuance of
10-6 obligations under Chapter 656, Acts of the 68th Legislature,
10-7 Regular Session, 1983 (Article 717q, Vernon's Texas Civil Statutes)
10-8 to the extent that it is not inconsistent with this chapter.
10-9 Sec. 466.032. CONDITIONS FOR ISSUANCE OF BONDS. (a) Bonds
10-10 may be issued as various series and issues.
10-11 (b) Bonds issued by the authority may mature serially or
10-12 otherwise not later than 50 years after the date on which they are
10-13 issued.
10-14 (c) The bonds may bear interest at a rate or rates
10-15 determined in accordance with the resolution or order authorizing
10-16 the issuance of the bonds but not to exceed the net effective
10-17 interest rate authorized by Chapter 3, Acts of the 61st
10-18 Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas
10-19 Civil Statutes).
10-20 (d) Rates of interest on bonds may be fixed, variable,
10-21 floating, adjustable, or otherwise.
10-22 Sec. 466.033. SECURITY QUALIFICATIONS. The board may take
10-23 any action necessary to qualify the authority bonds for offer and
10-24 sale under the securities laws and regulations of the United
10-25 States, this state, and other states of the United States.
11-1 Sec. 466.034. INVESTMENT SECURITIES. The bonds and any
11-2 interest coupons are investment securities under Chapter 8,
11-3 Business & Commerce Code, and may be issued registrable as to
11-4 principal or as to both principal and interest or may be redeemable
11-5 before maturity at the option of the authority or may contain a
11-6 mandatory redemption provision.
11-7 Sec. 466.035. FORM OF BONDS. (a) The authority's bonds may
11-8 be issued in the form, denominations, and manner and under the
11-9 terms, conditions, and details as provided by the board in the
11-10 resolution or order authorizing their issuance.
11-11 (b) The bonds shall be signed and executed as provided by
11-12 the board's resolution or order authorizing the issuance of the
11-13 bonds.
11-14 Sec. 466.036. FUNDS. (a) In the resolution or order
11-15 authorizing issuance of bonds, the board may make additional
11-16 covenants with respect to the bonds and the pledged revenues and
11-17 may provide for the flow of funds and the establishment,
11-18 maintenance, and investment of funds.
11-19 (b) The funds established may include an interest and
11-20 sinking fund, a reserve fund, and other funds that will be kept and
11-21 maintained by or under the direction of the board.
11-22 (c) Any funds established by the board are not to be a part
11-23 of the state treasury but, at the direction of the board, may be
11-24 kept and held in escrow and in trust by the state treasury on
11-25 behalf of the authority and the owners of the bonds and used only
12-1 as provided by this chapter.
12-2 (d) Money and funds shall be invested in authorized
12-3 investments as provided by any bond resolutions and orders of the
12-4 authority.
12-5 (e) Legal title in any fund is in the authority unless or
12-6 until paid from the fund as provided for by this chapter or the
12-7 resolutions or orders authorizing the bonds.
12-8 Sec. 466.037. RESOLUTIONS AND ORDERS. (a) The orders or
12-9 resolutions of the board issuing bonds may include those provisions
12-10 and covenants that the board deems necessary.
12-11 (b) In a resolution or order authorizing the issuance of the
12-12 authority's bonds, the board may prescribe systems, methods,
12-13 routines, and procedures under which the authority will function.
12-14 (c) The board may adopt and have executed any other
12-15 proceedings or instruments necessary and convenient in the issuance
12-16 of bonds.
12-17 Sec. 466.038. REFUNDING BONDS. (a) The board may issue
12-18 refunding bonds to refund all or part of its outstanding bonds
12-19 issued under this chapter, including matured but unpaid interest.
12-20 (b) The board may refund bonds in the manner provided by
12-21 general law for revenue bonds.
12-22 Sec. 466.039. LEGAL INVESTMENT. The bonds are legal and
12-23 authorized investments for banks, savings banks, trust companies,
12-24 savings and loan associations, insurance companies, fiduciaries,
12-25 trustees, guardians, and sinking funds of cities, counties, school
13-1 districts, and other political subdivisions of the state and other
13-2 public funds of the state and its agencies, including the permanent
13-3 school fund.
13-4 Sec. 466.040. TAX EXEMPT. The bonds issued under this Act,
13-5 and the interest and income from the bonds, and all fees, charges,
13-6 gifts, grants, revenues, receipts, and other money received or
13-7 pledged to pay or secure the payment of bonds are free from
13-8 taxation and assessments of every kind by this state and any city,
13-9 county, district, authority, or other political subdivision of this
13-10 state.
13-11 Sec. 466.041. PLEDGE OF STATE FAITH AND CREDIT; COVENANT
13-12 WITH OWNERS OF BONDS. (a) The authority's bonds are obligations
13-13 solely of the authority and are payable solely from funds of the
13-14 authority, and this chapter and the authority's bonds are not and
13-15 do not create or constitute a pledge, giving, or lending of the
13-16 faith or credit or taxing authority of the state.
13-17 (b) Each bond of the authority must include a statement that
13-18 the state is not obligated to pay the premium, the principal of, or
13-19 interest on the authority's bonds and that the faith or credit and
13-20 the taxing authority of the state is not pledged, given, or loaned
13-21 to those payments.
13-22 (c) The state pledges to and agrees with the owners of any
13-23 bonds issued in accordance with this chapter that the state will
13-24 not limit or alter the rights vested in the authority to fulfill
13-25 the terms of any agreements made with the owners of the bonds or in
14-1 any way impair the rights and remedies of those owners until the
14-2 bonds, together with any premium and interest, interest on any
14-3 unpaid premium or installments of interest, and all costs and
14-4 expenses in connection with any action or proceeding by or on
14-5 behalf of those owners, are fully met and discharged. The
14-6 authority may include this pledge and agreement of the state in any
14-7 agreement with the owners of the bonds.
14-8 SECTION 2. The importance of this legislation and the
14-9 crowded condition of the calendars in both houses create an
14-10 emergency and an imperative public necessity that the
14-11 constitutional rule requiring bills to be read on three several
14-12 days in each house be suspended, and this rule is hereby suspended,
14-13 and that this Act take effect and be in force from and after its
14-14 passage, and it is so enacted.