BILL ANALYSIS



H.J.R. 73
By: Romo
03-03-95
Committee Report (Unamended)


BACKGROUND

There are two authorized but unissued bond issues that could be
removed from the state's bond authorization. First, the National
Research Laboratory Commission has authorized but not issued debt
for the Superconducting Super Collider: $250 million of General
Obligation bonds and $250 million of revenue bonds. There is no
need for this debt, given the decision by Congress to end the
project's federal funding. General revenue bonds can be revoked by
the Texas legislature while General Obligation bonds must be
revoked by the voters of Texas.

Rating agencies periodically evaluate the state's debt structure to
determine municipal bond ratings, which affect the state's interest
rate of bonds. Debt factors include the type of security pledged to
debt repayment, debt burden, debt history and trend. Texas
currently has a "Aa" bond rating from Moody's, a "AA" rating from
Standard and Poor's and a "AA+" rating from Fitch Investors
Service. The difference between the interest rate on a "AA"-rated
bond and a "AAA" bond is a rating of 20 basis points which could,
in fact, save the State of Texas as much as $15 million in debt
service payments.

Revoking the authorization of the unissued bonds would affect the
state's debt structure by lowering the potential debt. By lowering
the debt, the state could eventually have its General Obligation
bond rating raised. The authorized-but unissued-debt is considered
in the overall debt analysis, and reducing this amount would
represent effective debt management and accounting.

PURPOSE

As proposed, H.J.R 73 will present to the voters of Texas a
constitutional amendment to revoke $250 million of general
obligation bonds issued for the Superconducting Super Collider.

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 Section 49-g(a), Article III, Texas Constitution,
as adopted pursuant to H.J.R. No. 88, Acts of the 70th Legislature
Regular Session, 1987 (a) Provides that the legislature may
authorize: the amount of general obligation bonds for use in the
use of the superconductor super collider be reduce from $500
million to $250 million dollars.

Section 2. Provides the constitutional amendment for the ballot of
the November 7, 1995 election.

SUMMARY OF COMMITTEE ACTION
The committee convened in a public hearing on March 6, 1995 to
consider HJR 73.  

The following people testified neutrally on the bill:  Edward C.
Binglar and Robert P. Carpenter.

HJR 73 was left pending.  The committee convened in a public
hearing on March 13, 1995 to consider HJR 73.  The motion to report
HJR 73 favorably without amendments, with the recommendation that
it do pass and be printed prevailed by the following record vote: 
9 Ayes, 0 Nays, 0 PNV, 0 Absent.