BILL ANALYSIS


                                                     C.S.S.B. 726
                                                       By: Sibley
                                                          Finance
                                                         04-12-95
                                   Committee Report (Substituted)
BACKGROUND

Institutions of higher education which implemented energy
conservation measures and subsequently reduced their energy usage
have seen a reduction in general revenue appropriations for energy
costs equal to the resulting savings, despite increases in square
footage and rate changes.

There currently exists no incentive for these institutions to
pursue energy performance contracts because they are not permitted
to retain any portion of the savings realized through such
contracts.

PURPOSE

As proposed, C.S.S.B. 726 would give higher education institutions
an incentive to enter into energy performance contracts by allowing
them to retain the estimated net savings resulting from these
contracts.
 
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 Section 51.927, Education Code, by adding
Subsection (j), to require the legislature to base an institution
of higher education's (institution) appropriation for energy costs
during a fiscal year on the sum of the institution's estimated
energy costs for that fiscal year and the institution's estimated
net savings resulting from the contract during the contract term,
divided by the number of years in the contract term.

SECTION 2. (a)  Effective date:  September 1, 1995. 

(b)  Provides that this Act does not apply to an appropriation
enacted before the       effective date of this Act, without regard
to the period for which the appropriation is made.

SECTION 3. Emergency clause.