By Dukes H.B. No. 1592
74R4045 SMH-F
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 public and private postsecondary educational
1-21 institutions.
1-22 Sec. 56.183. ADMINISTRATIVE AUTHORITY. (a) The state
1-23 treasurer, as provided by this subchapter, shall administer the
1-24 program.
2-1 (b) The state treasurer may adopt rules necessary to carry
2-2 out the purposes of this subchapter.
2-3 (c) The state treasurer may accept a gift or grant from a
2-4 public or private source for the purposes of this subchapter.
2-5 Sec. 56.184. Issuance And Sale. (a) The state treasurer
2-6 shall issue and sell the bonds in denominations determined by the
2-7 treasurer, but the face value of a bond may not be less than $50 or
2-8 more than $100.
2-9 (b) A person may not purchase more than one bond a month.
2-10 (c) The state treasurer shall execute necessary agreements
2-11 for the bonds to be available for purchase through payroll
2-12 deductions. The bonds shall also be available for purchase
2-13 directly from the state treasurer. The bonds may be made available
2-14 for purchase through other means and at other outlets as determined
2-15 by the state treasurer.
2-16 Sec. 56.185. TERMS. (a) Each bond must be issued in the
2-17 name of a person who is younger than 18 years of age on the date of
2-18 purchase and must bear that person's name.
2-19 (b) A bond shall earn interest compounded annually at a rate
2-20 determined annually by the state treasurer.
2-21 (c) The bonds may be sold at a price or under the terms
2-22 consistent with this subchapter that the state treasurer
2-23 determines.
2-24 (d) To the extent possible, the bonds shall be issued on
2-25 terms and in a form sufficient for income on the bonds to be exempt
2-26 from federal income tax.
2-27 (e) The bonds do not constitute indebtedness of the state.
3-1 Sec. 56.186. UBET FUND. (a) A special fund to be known as
3-2 the UBET fund is created in the state treasury.
3-3 (b) The fund consists of proceeds from the sale of the
3-4 bonds, gifts and grants, and interest earned on investment of the
3-5 fund.
3-6 (c) The state treasurer shall pay expenses of administering
3-7 this subchapter from the fund.
3-8 Sec. 56.187. REDEMPTION. (a) The person in whose name a
3-9 bond is issued and who enrolls in an institution of higher
3-10 education may redeem the bond on presentation of the bond to the
3-11 registrar of the institution. The registrar shall credit 110
3-12 percent of the face amount of the bond against any payment for
3-13 tuition or other fees of the student. The institution shall mark
3-14 the bond as redeemed and deliver the bond to the state treasurer.
3-15 The state treasurer shall reimburse the institution for the face
3-16 amount of the bond if sufficient money in the fund exists. The
3-17 rules of the state treasurer may provide for reimbursement to occur
3-18 through electronic funds transfer or other means.
3-19 (b) The state treasurer may execute agreements with private
3-20 postsecondary educational institutions for redemption of bonds in a
3-21 manner similar to that provided by Subsection (a). The agreements
3-22 may provide for redemption at 105 percent of the face amount of the
3-23 bond and reimbursement at the face amount of the bond if sufficient
3-24 money in the fund exists.
3-25 (c) On attaining age 18, the person in whose name a bond is
3-26 issued may also redeem the bond on presentation of the bond to the
3-27 state treasurer in the manner provided by rule of the state
4-1 treasurer. If the person in whose name a bond is issued dies
4-2 before redeeming the bond, the heir or devisee of the person may
4-3 redeem the bond on presentation to the state treasurer of a death
4-4 certificate. On presentation, the state treasurer shall pay the
4-5 person redeeming the bond the face amount of the bond if sufficient
4-6 money in the fund exists.
4-7 Sec. 56.188. MANDAMUS. The performance of official duties
4-8 prescribed by this subchapter, in reference to the payment of the
4-9 bonds, may be enforced in a court by mandamus or other appropriate
4-10 proceedings.
4-11 Sec. 56.189. REPLACEMENT OF BOND. The state treasurer may
4-12 provide for the replacement of any bond that is mutilated, lost, or
4-13 destroyed.
4-14 Sec. 56.190. MANAGEMENT. Money in the fund shall be
4-15 invested by the state treasurer in investments authorized for the
4-16 investment of state funds generally.
4-17 Sec. 56.191. EXEMPTION FROM TAXATION. Bonds issued under
4-18 this subchapter may not be taxed by the state or any of its
4-19 political subdivisions.
4-20 SECTION 2. This Act takes effect January 1, 1996.
4-21 SECTION 3. The importance of this legislation and the
4-22 crowded condition of the calendars in both houses create an
4-23 emergency and an imperative public necessity that the
4-24 constitutional rule requiring bills to be read on three several
4-25 days in each house be suspended, and this rule is hereby suspended.