BILL ANALYSIS


                                                        H.B. 2969
                                           By: McCoulskey (Brown)
                                      Intergovernmental Relations
                                                         05-22-95
                                Senate Committee Report (Amended)
BACKGROUND

Article 835s, V.T.C.S., authorizes the issuance of bonds by a
municipality to acquire land and construct or otherwise acquire
buildings and other facilities for the purpose of leasing the land,
building, or other facility.  The article provides for a bond
election prior to issuance, the application of the Bond Procedures
Act of 1981 to the issuance, approval by the attorney general of
the issuance, and other regulations.

The campus of Houston Community College System (HCCS) located in
the City of Stafford has experienced enormous growth since its
inception in 1987, quadrupling in size to over 4,000 students.  The
campus has fostered economic development in the city through its
business and vocation training programs.  Because of its fast
growth, the campus presently faces severe restrictions on increased
enrollment due to its limited and inadequate facilities.

As a result, the City of Stafford and HCCS have entered into an
agreement for the city to afford its credit to HCCS to build a
70,000 square foot facility on 17 acres of land located in the city
which will then be purchased by the city and leased back to HCCS at
payments equal to or greater than the amount of principal,
interest, and costs necessary to finance the total cost of the
municipal bonds utilized by the city for the purchase and
construction of the facility.

PURPOSE

As proposed, H.B. 2969 amends provisions relating to the
acquisition and disposition of land and facilities by a
municipality and to the issuance of municipal bonds.

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 Article 835s, V.T.C.S., by adding Section 2A, as
follows:

     Sec. 2A.  Authorizes a municipality with a population greater
     than 8,000 but less than 10,000 that is located in two
     counties with populations of 225,000 or more but less than
     2,818,199 to acquire, by any lawful means other than eminent
     domain, land, and may construct or otherwise acquire a
     building or other facility for the purpose of selling,
     pursuant to an installment sale agreement or otherwise, or
     leasing the land, building or other facility to an
     "institution of higher education" under Section 61.003,
     Education Code, which will provide a significant number of
     vocational and vocation-technical education courses in the
     facility for public use.  Authorizes a sale or lease under
     this section to an "institution of higher education" to
     proceed without the need for public notice or bidding, and
     otherwise on such terms as the governing body of the
     municipality may find acceptable.
     
     SECTION 2.     Amends Section 4(a), Article 835s, V.T.C.S., to
authorize the municipality to provide for the payment of the
principal of and interest on the bonds by pledging all or any part
of the designated revenues from the sale or lease of any or all of
the land, building, or other facility after deduction of the
reasonable cost of operation and maintenance, in addition to other
sources.

SECTION 3. Amends Section 7, Article 835s, V.T.C.S., as follows:

     Sec. 7.  EXECUTION OF DOCUMENTS.  Makes a conforming change.
     
     SECTION 4.     Emergency clause.
           Effective date: upon passage.