BILL ANALYSIS C.S.S.B. 1260 By: Montford (Patterson) 05-19-95 Committee Report (Substituted) BACKGROUND CSSB 1260 is enabling legislation for CSSJR 51. CSSJR 51 provides that $200 million of the $500 million authorization for the Farm and Ranch Finance Program may be used for the same purposes as the Texas Agricultural Finance Authority which has an authorization cap of $25 million. PURPOSE CSSB 1260 allows the Texas Agricultural Fund of the Texas Finance Authority to receive proceeds of more than $25 million. While the cap on TAFA still remains technically in place, for clarification, the fund needs to be able to receive proceeds of the Farm and Ranch authorization. The legislation also allows for the creation of "other rural economic development programs" as provided by CSSJR 51. Finally, the bill removes fund administration from the Veteran's Land Board to TAFA, for the Farm and Ranch loan guarantee program funds. 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 58.021 of the Agriculture Code to authorize the Texas Agricultural Finance Authority and Board to design and implement other rural economic development programs. Section 2. Amends Sections 58.031(a), (c), and (e), of the Agriculture Code to: (a) provide for the establishment of the Texas Agricultural Fund and the Rural Microenterprise Fund; (c) to remove the cap on what the fund may receive in proceeds; and (e) remove the cap to the fund originally established from the microenterprise program. Section 3. Amends section 59.001(2) of the Agriculture Code to comply with the TAFA Board administration of the Farm and Ranch Guarantee Loan bond authorization rather than the Veteran's Land Board. Section 4. Amends 59.002(b) of the Agriculture Code to the TAFA Board administration of the fund. Sections 5 and 6. Amend Chapters 58 and 59 to make language compatible with previous amendments. Section 7. Amends Section 59.012 of the Agriculture Code for language compatibility and to provide for constitutionally authorized bond proceeds to be administered in the same manner as Chapter 58. Sections 8-20. Amend Chapters 58 and 59 of the Agriculture Code to make language changes compatible with earlier amendments relating to investment of funds by the Veteran's Land Board, to delete investment language regarding the VLB, and to provide for payment of administrative costs. Section 21. Effective date, January 1, 1996, contingent on passage of SJR 51. Section 22. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE CSSB 1260 makes substantial changes to the original in the following areas: 1. The substitute provides for the establishment of other rural economic development programs as a mission for the Farm and Ranch Guaranteed Loan Program, The Texas Agricultural Finance Authority and the Texas Agriculture Fund. 2. The substitute provides for investment of the constitutionally authorized $200 million dollars of the Farm and Ranch funds rather than the original total authorization initially established for the farm and ranch fund. 3. The substitute amends the appropriate statute and language compatible with CSSJR 51. SUMMARY OF COMMITTEE ACTION The committee considered SB 1260 in a formal meeting on May 19, 1995. The Chair offered a complete committee substitute for the bill which was adopted without objection. The bill was reported favorably as substituted, with the recommendation that it do pass and be printed, by a record vote of: 5 Ayes, 0 Nays, 0 PNV, 4 Absent.