74R10324 SMH-D
By Dukes H.B. No. 1592
Substitute the following for H.B. No. 1592:
By Gallego C.S.H.B. No. 1592
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the establishment of the University Bonds for the
1-3 Education of Texans program; authorizing the issuance of special
1-4 savings certificates.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Chapter 56, Education Code, is amended by adding
1-7 Subchapter K to read as follows:
1-8 SUBCHAPTER K. UNIVERSITY BONDS FOR THE EDUCATION OF TEXANS
1-9 (UBET) PROGRAM
1-10 Sec. 56.181. DEFINITIONS. In this subchapter:
1-11 (1) "Bonds" means the special savings certificates
1-12 authorized under this subchapter.
1-13 (2) "Fund" means the UBET fund created in the state
1-14 treasury by this subchapter.
1-15 (3) "Program" means the University Bonds for the
1-16 Education of Texans (UBET) program established by this subchapter.
1-17 Sec. 56.182. ESTABLISHMENT OF PROGRAM; PURPOSE. The program
1-18 is established to provide the public with a method of saving in
1-19 advance for higher education tuition expenses and to encourage
1-20 enrollment at institutions of higher education.
1-21 Sec. 56.183. ADMINISTRATIVE AUTHORITY. (a) The state
1-22 treasurer, as provided by this subchapter, shall administer the
1-23 program.
1-24 (b) The state treasurer may adopt rules necessary to carry
2-1 out the purposes of this subchapter.
2-2 (c) The state treasurer may accept a gift or grant from a
2-3 public or private source for the purposes of this subchapter.
2-4 Sec. 56.184. Issuance And Sale. (a) The state treasurer
2-5 shall issue and sell the bonds in denominations determined by the
2-6 treasurer, but the face amount of a bond may not be less than $25.
2-7 (b) The state treasurer shall execute necessary agreements
2-8 for the bonds to be available for purchase through payroll
2-9 deductions. The bonds shall also be available for purchase
2-10 directly from the state treasurer. The bonds may be made available
2-11 for purchase through other means and at other outlets as determined
2-12 by the state treasurer.
2-13 Sec. 56.185. TERMS. (a) Each bond must be issued in the
2-14 name of a person who is younger than 18 years of age on the date of
2-15 purchase and must bear that person's name.
2-16 (b) A bond shall earn interest compounded annually at a rate
2-17 determined annually by the state treasurer.
2-18 (c) The bonds may be sold at a price or under the terms
2-19 consistent with this subchapter that the state treasurer
2-20 determines. The state treasurer may adopt more than one plan for
2-21 the payment of the purchase price of bonds issued under this
2-22 subchapter.
2-23 (d) To the extent possible, the bonds shall be issued on
2-24 terms and in a form sufficient for interest on the bonds to be
2-25 exempt from federal income tax.
2-26 (e) The bonds do not constitute indebtedness of the state.
2-27 Sec. 56.186. UBET FUND. (a) A fund to be known as the UBET
3-1 fund is created in the state treasury.
3-2 (b) The fund consists of proceeds from the sale of the
3-3 bonds, gifts and grants, and interest earned on investment of the
3-4 fund.
3-5 (c) The state treasurer shall pay expenses of administering
3-6 this subchapter from the fund.
3-7 (d) The state treasurer shall establish a separate account
3-8 in the fund for each person in whose name a bond is issued under
3-9 this subchapter. The state treasurer shall deposit to the credit
3-10 of the account the payment or payments of the purchase price of the
3-11 bond and the interest on the bond.
3-12 Sec. 56.187. REDEMPTION. (a) The person in whose name a
3-13 bond is issued and who enrolls in an institution of higher
3-14 education may redeem the bond on presentation of the bond to the
3-15 registrar of the institution. The registrar shall credit the face
3-16 amount of the bond and the accrued interest on the bond against any
3-17 payment for tuition or other fees of the student. The state
3-18 treasurer shall reimburse the institution for the face amount of
3-19 the bond and the accrued interest on the bond in accordance with
3-20 rules adopted by the state treasurer. The rules may provide for
3-21 reimbursement through electronic funds transfer or other means.
3-22 (b) The person in whose name a bond is issued and who
3-23 enrolls in a private or independent institution of higher education
3-24 as defined by Section 61.003 or an institution of higher education
3-25 outside of this state may redeem the bond on presentation of the
3-26 bond to the state treasurer in the manner provided by rule of the
3-27 state treasurer. On presentation, the state treasurer shall pay
4-1 the person the face amount of the bond and the accrued interest on
4-2 the bond.
4-3 (c) On attaining age 18, the person in whose name a bond is
4-4 issued may also redeem the bond on presentation of the bond to the
4-5 state treasurer in the manner provided by rule of the state
4-6 treasurer. If the person in whose name a bond is issued dies
4-7 before redeeming the bond, the heir or devisee of the person may
4-8 redeem the bond on presentation to the state treasurer of a death
4-9 certificate. On presentation, the state treasurer shall pay the
4-10 person redeeming the bond the face amount of the bond and the
4-11 accrued interest on the bond.
4-12 Sec. 56.188. MANDAMUS. The performance of official duties
4-13 prescribed by this subchapter, in reference to the payment of the
4-14 bonds, may be enforced in a court by mandamus or other appropriate
4-15 proceedings.
4-16 Sec. 56.189. REPLACEMENT OF BOND. The state treasurer may
4-17 provide for the replacement of any bond that is mutilated, lost, or
4-18 destroyed.
4-19 Sec. 56.190. MANAGEMENT. (a) Money in the fund shall be
4-20 invested by the state treasurer in investments authorized for the
4-21 investment of state funds generally.
4-22 (b) The state treasurer is immune from liability for any
4-23 losses from investments under Subsection (a).
4-24 Sec. 56.191. EXEMPTION FROM TAXATION. Bonds issued under
4-25 this subchapter may not be taxed by the state or any of its
4-26 political subdivisions.
4-27 Sec. 56.192. SCHOLARSHIP PROGRAM. (a) The state treasurer
5-1 shall establish a program under this subchapter to provide
5-2 economically disadvantaged youths with scholarships to institutions
5-3 of higher education. The board by rule shall adopt criteria for
5-4 the determination of economic disadvantage.
5-5 (b) The state treasurer shall encourage persons to
5-6 contribute to the purchase of bonds for the benefit of economically
5-7 disadvantaged youths.
5-8 (c) The state treasurer shall hold a bond purchased under
5-9 the scholarship program and redeem the bond at the institution of
5-10 higher education in which a person awarded a scholarship under this
5-11 section enrolls.
5-12 Sec. 56.193. GUARANTEE OF ADMISSION. This subchapter is not
5-13 a promise or guarantee that a person will be:
5-14 (1) admitted to any institution of higher education;
5-15 (2) admitted to a particular institution of higher
5-16 education;
5-17 (3) allowed to continue enrollment at an institution
5-18 of higher education after admission; or
5-19 (4) graduated from an institution of higher education.
5-20 Sec. 56.194. REPORTS. (a) The state treasurer periodically
5-21 shall provide each purchaser of a bond issued under this subchapter
5-22 a report of:
5-23 (1) the balance in the account in the fund established
5-24 for the person in whose name the bond was issued;
5-25 (2) the payments for the bond deposited to the credit
5-26 of the account; and
5-27 (3) the interest credited to the account.
6-1 (b) The state treasurer annually shall deliver to the
6-2 governor, lieutenant governor, and speaker of the house of
6-3 representatives a report regarding the status of the fund.
6-4 SECTION 2. This Act takes effect January 1, 1996.
6-5 SECTION 3. The importance of this legislation and the
6-6 crowded condition of the calendars in both houses create an
6-7 emergency and an imperative public necessity that the
6-8 constitutional rule requiring bills to be read on three several
6-9 days in each house be suspended, and this rule is hereby suspended.