BWM C.S.H.B. 1077 75(R)BILL ANALYSIS FINANCIAL INSTITUTIONS C.S.H.B. 1077 By: Telford 3-14-97 Committee Report (Substituted) BACKGROUND The Texas Public Finance Authority (TPFA) was created in 1983 by the 68th Legislature. TPFA is responsible for providing bond financing to its client agencies for legislatively-approved projects and ensuring timely and accurate payment of debt service on those bonds. TPFA currently issues bonds on behalf of 13 state agencies. In addition, TPFA administers the Master Lease Purchase Program. TPFA carries out its programs and functions through a staff located solely in Austin. To carry out these functions, TPFA had a budget of $605,204 and 14 employees for fiscal year 1996. TPFA is subject to the Sunset Act and will be abolished September 1, 1997 unless continued by the Legislature. As a result of its review of TPFA, the Sunset Advisory Commission recommended continuation and several statutory modifications that are contained in this legislation. PURPOSE The purpose of this bill is to continue the Texas Public Finance Authority for a 12-year period and make statutory modifications recommended by the Sunset Commission. The modifications proposed by this bill: -consolidate the bonding authority of agencies with small and infrequent state bond issuances into TPFA; -improve TPFA's interaction with client agencies by requiring an early, plain language orientation to TPFA's bond issuance process; -continue TPFA for 12 years; and -provide for other changes as recommended by the Sunset Commission. RULEMAKING AUTHORITY It is the committee's opinion that rulemaking authority is expressly granted to TPFA in SECTION 7 - Section 9D (e), (Article 601d, Vernon's Texas Civil Statutes) to by rule establish methods by which client agencies are notified of the name, mailing address, and telephone number of the authority for the purpose of directing complaints to the authority. In addition, under the general rulemaking authority already granted to TPFA, rules may be developed to implement other new provisions found in this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 4, Article 601d, Vernon's Texas Civil Statutes by adding (b) and (c). (b) Adds standard language developed by the Sunset Commission. Prohibits appointment to the board if the person or the person's spouse conducts business with the agency, or otherwise has financial ties to TPFA. (c) Adds standard language developed by the Sunset Commission. Requires appointments to the board be made without regard to race, color, disability, sex, religion, age, or national origin. SECTION 2. Adds Sections 5A and 5B. Section 5A. Adds standards language developed by the Sunset Commission. Defines the grounds for removing a board member and requires notification of the board's presiding officer, the Governor and the Attorney General if knowledge that a potential ground for removal exists. Affirms that an action of the board is valid even if it is taken when a ground for removal exists for one of the members. Section 5B. Adds standard language developed by the Sunset Commission. Requires board members to complete training before assuming their duties and being confirmed by the Senate. SECTION 3. Amends Section 6(a) and (c). (a) Adds standards language developed by the Sunset Commission. Requires the Governor to designate the presiding officer of the board. Also makes technical change. (c) Technical change. Changes the title of the presiding officer of the board to presiding officer and removes the title of chairman. SECTION 4. Adds Section 6A. Adds standard language developed by the Sunset Commission. Requires the board to give the public reasonable opportunity to appear before it regarding issues under the jurisdiction of the agency. SECTION 5. Adds Sections 8A-8G. Section 8A(a)-(d). Adds standard language developed by the Sunset Commission. Prohibits board members or their spouses and employees compensated at or above Group 17 in the General Appropriations Act or their spouses from being an officer or employee of a related Texas trade association. Prohibits registered lobbyists from serving as a member of the board or from being employed as the board's or TPFA's general counsel. Also defines trade association. Section 8B. Adds standard language developed by the Sunset Commission. Requires the executive director or a designee to inform board members and employees of the qualifications for office or employment and each person's responsibilities under the law. Section 8C. Adds standard language developed by the Sunset Commission. Requires the board to clearly separate its policymaking responsibilities from the management responsibilities of the executive director and staff of TPFA. Section 8D(a)-(c). Adds standard language developed by the Sunset Commission. Requires the executive director or a designee to develop an equal employment policy that is annually updated, reviewed by the Texas Commission on Human Rights, and filed with the Governor's Office. Section 8E(a)-(b). (a) Adds standard language developed by the Sunset Commission. Requires the executive director or a designee to develop an intra-agency career ladder program that addresses mobility and advancement opportunities for employees within TPFA and requires intra-agency postings of job openings concurrently with any public posting. (b) Adds standard language developed by the Sunset Commission. Requires the executive director or a designee to develop a system of annual performance evaluations based on documented employee performance upon which merit salary increases must be based. Section 8F. Adds standard language developed by the Sunset Commission. Requires TPFA to comply with state and federal program and facility accessibility laws and to develop a plan that describes how non-English speaking persons can be provided reasonable access to TPFA's programs. Section 8G(a)-(b). Adds standard language developed by the Sunset Commission. Requires TPFA to collect and maintain information about all complaints filed with TPFA. Requires TPFA to maintain files on written complaints it has the authority to resolve and to notify the parties regarding the status of the complaint quarterly until disposition. SECTION 6. Amends Section 9B by amending (a) and (c). (a) Requires the Texas Low-Level Radioactive Waste Disposal Authority, Midwestern State University, Stephen F. Austin State University, and Texas Southern University to issue bonds through TPFA. (c) Provides that TPFA has all the rights, duties and is subject to the same conditions relating to previous bond issuances sold by Midwestern State University, Stephen F. Austin State University, and Texas Southern University. SECTION 7. Adds Section 9D(a)-(f). (a)-(b) Requires TPFA to develop an orientation to the bond issuance process for client agencies that includes plain language information on the bond issuance process and an orientation meeting to be held before the bond issuance process begins. (c) Requires TPFA client agencies to provide TPFA with detailed project information, legislative authorization, and a list of staff designated to work with TPFA on a bond financed project. (d)-(f) Adds standards language developed by the Sunset Commission. Requires TPFA to prepare and distribute information to its client agencies concerning its functions and complaint procedures. Also defines client agency. SECTION 8. Adds Sections 26A and 26B. Section 26A. Adds standard language developed by the Sunset Commission. Requires TPFA's funds to be managed in accordance with the State Funds Reform Act. Section 26B. Adds standard language developed by the Sunset Commission. Requires TPFA to prepare an annual financial report that meets the reporting requirements in the General Appropriations Act. SECTION 9. Amends Section 31. Updates TPFA's Sunset date to September 1, 2009, which provides for the usual 12-year review. SECTION 10. Amends Section 55.13, Education Code by adding (c). Requires Midwestern State University, Stephen F. Austin State University, and Texas Southern University to issue bonds through TPFA. Provides that TPFA has all the rights, duties and is subject to the same conditions as a board of one of the institutions relating to bond issuances under this chapter. SECTION 11. Amends Section 402.094(c), Health and Safety Code. Authorizes the Texas Low-Level Radioactive Waste Disposal Authority to lease property on terms and conditions advantageous to it. Establishes that the Texas Low-Level Radioactive Waste Disposal Authority, for the purposes of a licensed disposal site, can only lease land from TPFA. SECTION 12. Amends Section 402.291 by adding (d). Provides that TPFA has all the rights, duties and is subject to the same conditions as the Texas Low-Level Radioactive Waste Disposal Authority relating to bond issuances in this chapter. SECTION 13. Specifies that the changes to the board member qualifications apply only to board members appointed on or after September 1, 1997. Specifies that the changes to board member qualifications do not prevent a person who serves on the board before September 1, 1997 from being reappointed if that person meets the qualifications effective on that date. SECTION 14. Effective date. SECTION 15. Emergency Clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The major point of difference between HB 1077, as introduced, and the committee substitute is the substitute does not contain language requiring TPFA to develop a plan that describes how non-English speaking persons can be provided reasonable access to TPFA's programs (SECTION 5, Sec. 8F, lines 17-20 of original bill).