IMF H.B. 10 75(R)BILL ANALYSIS STATE AFFAIRS H.B. 10 By: Brimer 4-10-97 Committee Report (Amended) BACKGROUND The Texas Legislative Council is required by law (Section 323.007, Government Code) to carry out a complete nonsubstantive revision of the Texas statutes. The process involves reclassifying and rearranging the statutes in a more logical order, employing a numbering system and format that will accommodate future expansion of the law, eliminating repealed, invalid, duplicative, and other ineffective provisions, and improving the draftsmanship of the law if practicable--all toward promoting the stated purpose of making the statutes "more accessible, understandable, and usable" without altering the sense, meaning, or effect of the law. In 1965 the council adopted a long-range plan of compiling the law into 26 codes arranged by general topics. Although some reorganization has occurred since the original proposal, the number of projected codes remains at 26. The proposed Finance Code is a nonsubstantive revision of the Texas statutes relating to finance, including the Texas Banking Act, Texas Savings and Loan Act, Texas Savings Bank Act, Texas Credit Union Act, and various other statutes relating to financial institutions, businesses, and transactions. The Finance Code is divided into five titles, specifically: Title 1, General Provisions; Title 2, Financial Regulatory Agencies; Title 3, Financial Institutions and Businesses; Title 4, Regulation of Interest, Loans, and Financed Transactions; and Title 5, Protection of Consumers of Financial Services. Each of the five titles is divided into subtitles, chapters, subchapters, and sections. Sections are numbered decimally, and the number to the left of the decimal point is the same as the chapter number. Gaps in chapter and section numbering are for future expansion. The council legal staff has taken meticulous care to ensure that no substantive change has been made in the law and to preserve any ambiguity or interpretation that may exist in current law. The staff has developed an extensive mailing list, and drafts of the proposed code have been widely distributed for review and comment to interested individuals, organizations, businesses, industry representatives, and governmental agencies. The staff has studied the comments and suggestions of persons reviewing the code and has taken action to satisfy any concerns expressed. The Finance Code is a nonsubstantive revision of Texas law. The substance of the law has not been altered. The sole purpose of the code is to compile the relevant law, arrange it in a logical fashion, and rewrite it without altering its meaning or legal effect. If a particular source statute is ambiguous and the ambiguity cannot be resolved without a potential substantive effect, the ambiguity is preserved. PURPOSE As proposed, H.B. 10 would create the Finance Code for the State of Texas. The bill is a nonsubstantive recodification of all statutes relating to finance in the state. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS Section 1. Adopts the Finance Code, a nonsubstantive revision of statutory law relating to financial institutions, financial businesses, and credit. Section 2. Conforming amendment to Title 4, Business & 97M35Commerce Code, adding Chapter 38, a nonsubstantive revision of certain laws relating to telephone solicitation. Section 3. Conforming amendment to Title 4, Business & Commerce Code, adding Chapter 39, a nonsubstantive revision of certain laws relating to cancellation of certain consumer transactions. Section 4. Conforming amendment to Title 4, Business & Commerce Code, adding Chapter 40, a nonsubstantive revision of certain laws relating to contests and gift giveaways. Section 5. Conforming amendment to Title 4, Business & Commerce Code, adding Chapter 41, a nonsubstantive revision of certain laws relating to business opportunities. Section 6. Repeals laws that are revised in the bill. Section 7. States legislative intent to recodify only. Section 8. Effective date: September 1, 1997. Section 9. Emergency clause. EXPLANATION OF AMENDMENT Committee Amendment No. 1 was drafted by the Texas Legislative Council after preliminary drafts of the Finance Code were distributed to interested persons, agencies, and organizations. The comments received in response before H.B. 10 was filed were incorporated into the bill. Several comments, however, were received after the bill was filed. The amendment incorporates these later comments. The person making the comments believed that several changes that were made in the revision did not reflect the prior law. Each of the changes made by the amendment is a reversion to the wording used in the prior law.