By Ellis S.B. No. 708
74R6574 GCH-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to state energy efficiency and conservation programs;
1-3 granting the authority to issue revenue bonds.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The State Purchasing and General Services Act
1-6 (Article 601b, Vernon's Texas Civil Statutes) is amended by adding
1-7 Article 16 to read as follows:
1-8 ARTICLE 16. TEXAS ENERGY EFFICIENCY AND CONSERVATION PROGRAM
1-9 Sec. 16.01. POLICY. It is the policy of this state to
1-10 promote energy efficiency and conservation within the state.
1-11 Implementation of the program provided by this article will be in
1-12 furtherance of that policy by making financial and technical
1-13 assistance available to authorized borrowers to enable the
1-14 borrowers to undertake energy efficiency and conservation projects.
1-15 Sec. 16.02. DEFINITIONS. In this article:
1-16 (1) "Authority" means the Texas Public Finance
1-17 Authority.
1-18 (2) "Program" means the Texas energy efficiency and
1-19 conservation program provided by this article.
1-20 (3) "Revenue bonds" means bonds, notes, commercial
1-21 paper, or other obligations.
1-22 (4) "Revolving fund" means the Texas energy efficiency
1-23 and conservation revolving fund.
1-24 Sec. 16.03. TEXAS ENERGY EFFICIENCY AND CONSERVATION
2-1 REVOLVING FUND. (a) The Texas energy efficiency and conservation
2-2 revolving fund is established in the state treasury.
2-3 (b) The revolving fund consists of the proceeds of revenue
2-4 bonds issued as provided by this article, fees collected as
2-5 provided by Section 16.06 of this article, federal grants, direct
2-6 appropriations, income from investment or deposit of amounts in the
2-7 fund, grants from private sources, and repayments of financial
2-8 assistance made from the fund.
2-9 (c) The commission may provide for the establishment and
2-10 maintenance of separate accounts within the revolving fund,
2-11 including program accounts, and, at the direction of the authority,
2-12 shall provide for interest and sinking accounts and reserve
2-13 accounts relating to revenue bonds. The state treasurer shall hold
2-14 the assets of the revolving fund in trust for the program and the
2-15 repayment of bonds issued for the program. The revolving fund is a
2-16 trust fund for all purposes, including the application of Sections
2-17 403.094, 403.095, and 404.071, Government Code.
2-18 (d) Money in the revolving fund may be appropriated only for
2-19 the repayment of bonds issued for the program, the payment of costs
2-20 of issuance of the bonds, and making loans under and paying
2-21 expenses for the administration of the program. The use of money
2-22 from the fund must be consistent with Section 18, Article III,
2-23 Texas Constitution.
2-24 (e) The commission and the authority shall jointly
2-25 administer the revolving fund.
2-26 Sec. 16.04. AUTHORIZED BORROWERS AND ELIGIBLE PROJECTS.
2-27 (a) An agency or governmental entity of the state and any
3-1 political subdivision or other type of local governmental entity in
3-2 the state, including a county, municipality, special purpose
3-3 district, or corporation held by a governmental entity, is
3-4 authorized to be a borrower under the program provided by this
3-5 article.
3-6 (b) Any energy efficiency or conservation project undertaken
3-7 by an authorized borrower involving the acquisition, construction,
3-8 fabrication, installation, or maintenance of improvements,
3-9 buildings, facilities, or equipment determined by the authorized
3-10 borrower to promote the conservation or efficient use of energy
3-11 sources is an eligible project for assistance under the program
3-12 provided by this article, including a project involving the
3-13 conversion of motor vehicles or other sources of substantial energy
3-14 use to alternative fuels and engine-driven applications and a
3-15 project involving the acquisition, construction, fabrication,
3-16 installation, or maintenance of fueling stations supplying
3-17 alternative fuels or equipment enhancing the use of engine-driven
3-18 technology to support motor vehicles or other energy applications
3-19 that use alternative fuels.
3-20 Sec. 16.05. TEXAS ENERGY EFFICIENCY AND CONSERVATION
3-21 PROGRAM. (a) The commission shall establish and administer the
3-22 Texas energy efficiency and conservation program, shall administer
3-23 all loans made under the program, and shall collect loan payments
3-24 and deposit them in the revolving fund. The commission shall adopt
3-25 rules governing the application for financial assistance under the
3-26 program and establish criteria for determining which authorized
3-27 borrowers may participate in the program. In establishing criteria
4-1 for participation in the program, the commission shall adopt
4-2 requirements to ensure the full repayment of all financial
4-3 assistance and the solvency of the program.
4-4 (b) The commission may adopt other rules it considers
4-5 necessary to administer the program or considers in the best
4-6 interests of the program.
4-7 Sec. 16.06. FEES. The commission shall set and collect,
4-8 from applicants and borrowers under the program, fees the
4-9 commission considers sufficient to cover the expenses of
4-10 administering the program or considers in the best interest of the
4-11 program. The commission shall deposit the fees in the revolving
4-12 fund and shall apply the fees in accordance with the commission's
4-13 resolutions and rules.
4-14 Sec. 16.07. ISSUANCE OF REVENUE BONDS. (a) The commission
4-15 by resolution may periodically apply for the issuance of revenue
4-16 bonds for the purpose of providing money for the revolving fund by
4-17 submission to the authority of a request for financing that
4-18 describes the projects to be financed. The total amount of bonds
4-19 issued for the revolving fund and the program may not exceed $100
4-20 million. The commission shall submit each such resolution it
4-21 adopts to the authority, and the authority is responsible for
4-22 issuing the bonds for the commission.
4-23 (b) Proceeds of revenue bonds issued as provided by this
4-24 article shall be deposited in the revolving fund and applied in
4-25 accordance with the resolution applying for issuance of the bonds:
4-26 (1) to provide financial assistance to authorized
4-27 borrowers; and
5-1 (2) to pay costs of issuance of those revenue bonds.
5-2 (c) Revenue bonds issued as provided by this article are
5-3 obligations solely of the authority and are payable solely from
5-4 money in the revolving fund, which is pledged to the repayment of
5-5 the revenue bonds. The authority's revenue bonds under this
5-6 article are not and do not create or constitute a pledge, giving,
5-7 or lending of the faith, credit, or taxing power of the state.
5-8 Each revenue bond issued under this article must contain a
5-9 statement to the effect that the state is not obligated to pay the
5-10 principal of or any premium or interest on the revenue bond and
5-11 that neither the faith or credit nor the taxing power of the state
5-12 is pledged, given, or loaned to such a payment.
5-13 (d) Revenue bonds of the authority shall be payable as to
5-14 principal, interest, and redemption premium, if any, from and
5-15 secured by a first lien or a subordinate lien on and pledge of all
5-16 or any part of the property, revenues, income, or other resources
5-17 in the revolving fund, and may be further secured by all or part of
5-18 the net revenues dedicated under the loan documents by the borrower
5-19 for payment of the revenue bonds, by taxes levied by the borrower
5-20 for that purpose, or by a combination of taxes and net revenue from
5-21 other available sources, as specified in the commission's
5-22 resolution applying for issuance of those revenue bonds. The
5-23 authority may require that the loans made under the program be
5-24 supported both by taxes and by net revenue from the operation of
5-25 the project in any ratio the authority considers necessary to fully
5-26 secure the loans. The authority shall establish other conditions
5-27 and requirements it considers to be consistent with sound
6-1 investment practices and in the public interest.
6-2 (e) The commission may provide in a resolution applying for
6-3 the issuance of revenue bonds a request for the issuance of
6-4 additional revenue bonds to be equally and ratably secured by lien
6-5 on the revenues and receipts or for the issuance of subordinate
6-6 lien revenue bonds.
6-7 (f) Revenues of the commission that may be used as a source
6-8 of payment for the revenue bonds or to establish a reserve account
6-9 to secure the payment of debt service on the revenue bonds include
6-10 repayments of financial assistance, money appropriated by the
6-11 legislature to the commission for the purpose of paying or securing
6-12 the payment of debt service on the revenue bonds, fees collected
6-13 under Section 16.06 of this article, and federal or private money
6-14 allocated to the program.
6-15 Sec. 16.08. DEFAULT. In the event of a default in payment
6-16 of the principal of or interest on any loan made under the program
6-17 or any other default with respect to the loan, the attorney general
6-18 shall institute appropriate proceedings by mandamus or other legal
6-19 remedies to compel the borrower or its officers, agents, and
6-20 employees to cure the default by performing those duties that they
6-21 are legally obligated to perform. These proceedings shall be
6-22 brought and venue shall be in a district court of Travis County.
6-23 Sec. 16.09. GENERAL PROVISIONS RELATING TO BONDS. (a) The
6-24 authority's revenue bonds under this article may be issued by the
6-25 authority from time to time in one or more series or issues, in
6-26 bearer, registered, or any other form, which may include registered
6-27 uncertified obligations not represented by written instruments and
7-1 commonly known as book-entry obligations, the registration of
7-2 ownership and transfer of which shall be provided for by the
7-3 authority under a system of books and records maintained by the
7-4 authority. Bonds may mature serially or otherwise not more than 40
7-5 years from their date of issuance. Bonds may bear no interest or
7-6 may bear interest at any rate or rates, fixed, variable, floating,
7-7 or otherwise, determined by the authority or determined pursuant to
7-8 any contractual arrangements approved by the authority, not to
7-9 exceed the maximum net effective interest rate allowed by Chapter
7-10 3, Acts of the 61st Legislature, Regular Session, 1969 (Article
7-11 717k-2, Vernon's Texas Civil Statutes). Interest on the bonds may
7-12 be payable at any time, and the rate of interest on the bonds may
7-13 be adjusted at such time as may be determined by the authority or
7-14 as may be determined pursuant to any contractual arrangement
7-15 approved by the authority. In connection with the issuance of
7-16 bonds as provided by this article, the authority may exercise the
7-17 powers granted to the governing body of an issuer in connection
7-18 with the issuance of obligations under Chapter 656, Acts of the
7-19 68th Legislature, Regular Session, 1983 (Article 717q, Vernon's
7-20 Texas Civil Statutes).
7-21 (b) The bonds issued under this article and interest
7-22 coupons, if any, are investment securities under the terms of
7-23 Chapter 8, Business & Commerce Code. The bonds are exempt
7-24 securities under The Securities Act (Article 581-1 et seq.,
7-25 Vernon's Texas Civil Statutes), and unless specifically provided
7-26 otherwise, under any subsequently enacted securities law. Any
7-27 contract, guaranty, or other document executed in connection with
8-1 the issuance of bonds pursuant to this article is not a security
8-2 under The Securities Act (Article 581-1 et seq., Vernon's Texas
8-3 Civil Statutes), and unless specifically provided otherwise, any
8-4 subsequently enacted securities law. The authority may do all
8-5 things necessary to qualify the bonds for offer and sale under the
8-6 securities laws and regulations of the United States and of the
8-7 states and other jurisdictions in the United States as the
8-8 authority determines.
8-9 (c) The bonds may be issued in the form and denominations
8-10 and executed in the manner and under the terms, conditions, and
8-11 details determined as provided by the authority in the resolution
8-12 authorizing their issuance. If any officer whose manual or
8-13 facsimile signature appears on the bonds ceases to be an officer,
8-14 the signature is still valid and sufficient for all purposes as if
8-15 the officer had remained in office.
8-16 (d) The bonds may be sold at public or private sale with or
8-17 without public bidding in the manner, at such rate or rates, price
8-18 or prices, and on such terms as may be determined by the authority
8-19 or determined as provided in any contractual arrangement approved
8-20 by the authority. The authority also may enter into any
8-21 contractual arrangement under which the bonds are to be sold from
8-22 time to time, or subject to purchase, at such prices and rates,
8-23 interest rate or payment periods, and terms as determined pursuant
8-24 to that contractual arrangement approved by the authority.
8-25 (e) The authority may provide procedures for the replacement
8-26 of a mutilated, lost, stolen, or destroyed bond or interest coupon.
8-27 (f) The resolutions of the authority issuing bonds may
9-1 contain other provisions and covenants as the authority may
9-2 determine. The authority may adopt and have executed any other
9-3 proceedings or instruments necessary and convenient in the issuance
9-4 of bonds as provided by this article, including entering into
9-5 financing agreements with the commission.
9-6 Sec. 16.10. APPLICATION OF TEXAS PUBLIC FINANCE AUTHORITY
9-7 ACT. Section 10A, as added by Chapter 896, Acts of the 71st
9-8 Legislature, Regular Session, 1989, and Sections 10B, 15, 16, 17,
9-9 18, 19, and 20, Texas Public Finance Authority Act (Article 601d,
9-10 Vernon's Texas Civil Statutes), apply to revenue bonds issued by
9-11 the authority under this article as if the bonds were issued under
9-12 that Act for the construction of a building.
9-13 SECTION 2. (a) Section 2305.065, Government Code, is
9-14 repealed.
9-15 (b) On the effective date of this Act, all obligations and
9-16 records of the revolving loan program created under Section
9-17 2305.065, Government Code, are transferred to the General Services
9-18 Commission and become property and obligations under the Texas
9-19 energy efficiency and conservation program established under
9-20 Article 16, State Purchasing and General Services Act (Article
9-21 601b, Vernon's Texas Civil Statutes), as added by this Act, and all
9-22 obligations to the former program become obligations to the Texas
9-23 energy efficiency and conservation program.
9-24 (c) If revenue bonds are issued under Article 16, State
9-25 Purchasing and General Services Act (Article 601b, Vernon's Texas
9-26 Civil Statutes), as added by this Act, and the bond proceeds are
9-27 used to replace money appropriated from the oil overcharge account,
10-1 the oil overcharge money that is replaced by those proceeds may be
10-2 used only to finance projects under Chapter 2305, Government Code,
10-3 for low-income individuals and low-wealth school districts.
10-4 SECTION 3. This Act takes effect September 1, 1995.
10-5 SECTION 4. The importance of this legislation and the
10-6 crowded condition of the calendars in both houses create an
10-7 emergency and an imperative public necessity that the
10-8 constitutional rule requiring bills to be read on three several
10-9 days in each house be suspended, and this rule is hereby suspended.