BILL ANALYSIS


                                                        S.J.R. 29
                                                         By: West
                                                    State Affairs
                                                           3-3-95
                                     Committee Report (Unamended)
BACKGROUND

Testimony before the Joint Interim Committee on Historically
Underutilized Businesses (HUBs) indicates that while state
purchases from HUBs have increased dramatically over the past four
years, an equitable distribution of state contracts to HUBs is
still elusive.  One problem that HUBs face, according to the
committee, is the difficulty of obtaining start-up funds.

PURPOSE

As proposed, S.J.R. 29 requires the submission to the voters of a
constitutional amendment authorizing the legislature to provide for
the issuance of bonds for the state financing of start-up costs for
historically underutilized businesses.

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 XVI, Texas Constitution, by adding
Section 72, as follows:

     Sec. 72.  (a)  Authorizes the legislature by law to establish
     a Texas historically underutilized business capital growth and
     start-up fund to be used, without further appropriation, only
     for a program established by the legislature to aid in the
     start-up costs of historically underutilized businesses, as
     defined by the legislature.  Requires the fund to contain a
     program account, an interest and sinking account, and other
     accounts authorized by the legislature.  Authorizes the
     legislature to issue up to $50 million of general obligation
     bonds to provide funding for the fund.  Requires the fund to
     be composed of the proceeds of the bonds authorized by this
     subsection, loan guarantees, and any other amount required to
     be deposited by the legislature.
     
     (b)  Authorizes the legislature to require review and
       approval of issuance of bonds under this section, of the use
       of the bond proceeds, or of the rules adopted by an agency
       to govern use of the bond proceeds.  Authorizes any entity
       created or directed to conduct this review and approval to
       include members or appointees of members of the executive,
       legislative, and judicial departments of state government.
       
       (c)  Provides that bonds authorized under this section
       constitute a general obligation of the state.  Provides that
       a sufficient amount to pay the principal of and interest on
       the bonds that mature or become due during the fiscal year
       is appropriated out of the first money coming into the
       treasury, while any of the bonds or interest on the bonds is
       outstanding and unpaid.
       
SECTION 2.  Requires this proposed amendment to be submitted to the
voters at an election to be held November 7, 1995.  Sets forth the
required language for the ballot.