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.