BILL ANALYSIS C.S.S.B. 537 By: Rosson Finance 04-11-95 Committee Report (Substituted) BACKGROUND The Senate Finance Committee held a two-day hearing in El Paso to address concerns raised by the El Paso Court of Inquiry about inequitable funding of certain services and programs in El Paso. The Finance Committee adopted findings and recommendations regarding state funding issues in El Paso, including a recommendation that "the State Legislature and state agencies should explore ways to assist communities which lack the resource base necessary to develop local matching funds which under some programs are needed to draw down state or federal dollars." PURPOSE As proposed, C.S.S.B. 537 creates the state match pool administered by the governor's office of budget and planning to assist hardship applicants in drawing down federal funds. RULEMAKING AUTHORITY It is the committee's opinion that rulemaking authority is granted to the budget and planning division of the governor's office under SECTION 1 (Sec.743.004, Government Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Title 7, Government Code, by adding Chapter 743, as follows: CHAPTER 743. MATCHING FUNDS FOR POLITICAL SUBDIVISIONS Sec. 743.001. STATE MATCH POOL. Provides that the state match pool (pool) which is an account in the general revenue fund that may be used only to provide funds for the local share requirement of a program offering federal matching funds and the pool is administered by the budget and planning division of the governor's office. Sec. 743.002. APPLICATION FOR MATCH POOL FUNDS. Authorizes a political subdivision seeking funds for the local share requirement of a program offering federal matching funds to make an application to the budget and planning division of the governor's office for funds from the pool. Requires the application to be on a form prescribed by the division. Sec. 743.003. CRITERIA FOR MATCH POOL FUNDS. (a) Requires the budget and planning division to grant an application under certain conditions. (b) Requires the rules adopted to provide that an applicant has hardship status if certain conditions apply. (c) Authorizes the budget and planning division to grant any amount from the pool up to the amount requested. Sec. 743.004. CONDITIONS OF GRANT. Requires the budget and planning division to condition the award of money based on the performance of a specific activity, regular expenditure reports, possible audits in accordance with Chapter 321, and any other conditions the division, by rule, may adopt to ensure proper expenditure of money. Sec. 743.005. LIMITATIONS ON AWARDING GRANTS. Prohibits the budget and planning division from granting an award of funds provided for in this chapter for more than two applications for funds by any political subdivision during any state fiscal year. Prohibits the budget and planning division from granting an award of funds provided for in this chapter for more than one application for funds by any public or private entity other than a political subdivision. SECTION 2. Effective date: September 1, 1995. SECTION 3. Emergency clause.