JKM H.B. 1410 75(R) BILL ANALYSIS ECONOMIC DEVELOPMENT H.B. 1410 By: Hill 3-21-97 Committee Report (Amended) BACKGROUND The development corporation act of 1979 was enacted by the 66th Legislature. The general purpose of the act is the promotion of "gainful employment" and the development of business, commerce, and industry. The act permits the creation of development corporations by cities, counties, and water districts, which can use sales tax revenue, at a rate of up to 1/2 cent, for economic development purposes. The board of directors of an industrial development corporation is appointed by the sponsoring governmental unit. The corporation is authorized to issue bonds specifically declared not to be a debt of the sponsoring governmental unit. These bonds are retired with the revenue derived from any "project" for which the bonds may be issued or sales tax revenue dedicated to the corporation. A "project" is a broadly defined term and includes transportation facilities, utility improvements, and property promoting manufacturing and industrial development. The Texas Department of Commerce is given general oversight responsibility for the approval of leases, loans and the issuance of bonds by industrial development corporations. The act also grants industrial development corporations tax exempt status. PURPOSE To add "affordable housing" to the expressed purposes for which an industrial development corporation may issue bonds. 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. Amends Article 5190.6, Section 2 (10) to add "affordable housing" to the definition of "project". SECTION 2. Emergency Clause. EXPLANATION OF AMENDMENTS AMENDMENT #1, in SECTION 1 of the bill, gives a specific meaning to "affordable housing" for the purposes of this bill. "Affordable housing" refers to the conditions defined by 42 USC Sec. 12745.