BILL ANALYSIS



C.S.H.B. 1355
By: Van de Putte
04-27-95
Committee Report (Substituted)


BACKGROUND

According to the U.S. Council of the Mexico/U.S. Business
Committee, almost $3 billion is needed to bring potable water and
wastewater treatment plants to Texas colonias, Texas cities and
towns, and to Juarez, Reynosa, and Matamoros.

The council indicated current revenue sources available in Texas
and Mexico will leave the border region $1.9 billion short of
fulfilling its water needs.

With the passage of NAFTA and the advent of the Border
Environmental Cooperation Commission and the North American
Development Bank, local communities have a mechanism through which
they can use international cooperation agreements with Mexico to
finance infrastructure development.

PURPOSE

As proposed, C.S.H.B. 1355 authorizes a political subdivision or a
state agency to enter into agreements with the United Mexican
States.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly
grant any additional rulemaking authority to a state officer,
department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Title 7, of the Government Code by adding Chapter
792, INTERNATIONAL COOPERATION AGREEMENTS

     Sec. 792.001.  Defines "political subdivision" and "state
     agency".

     Sec. 792.002. AGREEMENTS WITH MEXICO.  Permits an agency or
     political subdivision to enter into agreements with the United
     Mexican States or a subdivision there of, an agency of the
     United States, or any agency created under treaty between the
     United States and the United States of Mexico.

     Sec. 792.003. SCOPE OF AGREEMENT.  Agreements under this
     section shall only be entered if the agreement is for the
     accomplishment of a function that the agency or political
     subdivision is authorized to perform under law.

     Sec. 792.004. TERMS. An agency or political subdivision is
     authorized to; acquire or dispose an interest in real property
     in this state or the United Mexican States, use necessary
     funds to accomplish the purposes of the agreement, use
     necessary equipment, facilities or other property to
     accomplish the agreement, and to agree to any other necessary
     terms that are not prohibited by federal or state law. An
     agreement made under this section shall not provide for the
     liability of the state or political subdivision on a bond or
     other obligation.

     Sec. 792.005. BONDS. Agencies and political subdivisions may
     issue bonds or other evidence of indebtedness to provide
     financing for the agreements in the same manner that the
     agency or political subdivision is currently authorized to
     perform.

     Sec. 792.006. APPROVAL OF THE TEXAS BOND REVIEW BOARD.  An
     agreement under this chapter requires the approval of governor
     and the Legislative Budget Board.

SECTION 2.  Effective date: upon passage.  Emergency clause.

COMPARISON OF ORIGINAL TO SUBSTITUTE

The following changes were made to this bill by means of a
substitute:

(1) SECTION 1, Sec. 792.001(2) has been expanded by the addition of
subsections (A)-(F) to specify which agencies would be allowed to
participate in these agreements.

(2) SECTION 1, Sec. 792.004 has been expanded by the addition of
subsection (b) which states that an agreement made under this
chapter shall not provide for the liability of the state or any
political subdivision on a bond or other obligation.

(3) SECTION 1, Sec. 792.005 has been expanded by the addition of
the phrase, "and in the same manner" added for clarification as to
application of present regulations.

(4) SECTION 2, Sec. 792.006; Approval by the Texas Bond Review
Board was replaced by approval by the Governor and the Legislative
Budget Board.

SUMMARY OF COMMITTEE ACTION

Pursuant to posting of public notice the House Committee on State
Affairs convened in a public hearing on February 27, 1995 to
consider HB 1355.  The Chair laid out HB 1355 and recognized Rep.
Van de Putte to explain the bill.  Rep. Seidlits laid out a
complete committee substitute which was not adopted.  The following
persons testified for the bill: William T. Avila representing
himself; and Robert G. Rodriguez representing himself.  The
following persons testified neutrally on the bill: Jeannie Cisnenos
representing the Texas Water Development Board; Anne L. Schwartz
representing the Texas Public Finance Authority; and Jonathan
Steinberg representing the Texas Water Development Board.  The
Chair recognized Rep. Van de Putte to close.  The Chair left HB
1355 pending.  In a public hearing on April 11, 1995 the Chair laid
out HB 1355.  Rep. B. Hunter laid out a complete committee
substitute which was adopted without objection.  The bill was
reported favorably as substituted with the recommendation that it
do pass and be printed by a record vote of 9 ayes, 3 nay, 1 pnv,
and 2 absent.