BILL ANALYSIS H.B. 1361 By: Alexander 5-3-95 Committee Report (Unamended) BACKGROUND Current law, (Health and Safety Code, Chapter 794) does not allow rural fire prevention districts to borrow funds in excess of funds they have on hand or anticipated revenues in order to purchase equipment. Many rural districts need equipment for fire fighting, including fire trucks, water tank vehicles and other equipment. However, many districts on-hand funds and anticipated revenues are not enough to purchase this equipment. Nor can districts borrow against any future revenues which they may anticipate. PURPOSE House Bill 1361 allows rural fire prevention districts to borrow funds in excess of those available or anticipated revenues in a given year for the purpose of purchasing fire-fighting equipment. Future annual revenues, available cash, or the equipment itself may be used as collateral for a loan. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1: Amends Health and Safety Code, Section 794.071, to add section 794.083 as exceptions under which a fire prevention district may borrow more than they have on hand or will receive in current revenues during a year. SECTION 2: Amends Health and Safety Code, Chapter 794, Subchapter E by adding Section 794.083 which indicates that (a)the board of a fire prevention district may borrow money and make other financial arrangements in order to purchase equipment as they consider advisable. (b)In order to secure a loan, the board may pledge as collateral: (1)tax revenues or funds not otherwise earmarked to pay another loan; or (2)the equipment acquired with the borrowed funds. (c)If the district uses tax revenues as collateral, the loan must mature no later than five years after the date the loan is made. SECTION 3: Emergency Clause and Effective Date as upon passage. SUMMARY OF COMMITTEE ACTION HB 1361 was considered by the County Affairs Committee in a public hearing on 5/3/95. HB 1361 was reported favorably with the recommendation that it do pass and be printed and be sent to the Committee on Local and Consent Calendars, by the record vote of 5 ayes, 0 nays, 0 pnv, 0 absent.