SCT H.B. 2838 75(R) BILL ANALYSIS STATE FEDERAL & INTERNATIONAL RELATIONS H.B. 2838 By: Carter 4-15-97 Committee Report (Amended) Background In 1994, the North Texas Library System (NTRLS) was changed from the typical library system, under the administration of the Fort Worth Public Library and the City of Fort Worth to an independent nonprofit corporation. Because NTRLS no longer has the protection of a city or other Major Resource Center behind it, the State Archives and Library Commission has imposed cash reserve requirements on NTRLS to provide for possible interruption of cash flow to the system or the possibility of incurring costs that cannot be paid with government grant funds. Purpose To facilitate the establishment of a cash reserve fund for the North Texas Library System. Rulemaking Authority HB 2838 gives rulemaking authority to the State Archives and Library Commission to set up the cash reserve plan for regional library systems including audit and reporting procedures. SECTION 1. Amends 441.131, Government Code to require the State Archives and Library Commission to impose a cash reserve requirement on regional library systems. The systems may retain five percent of their grant funds from year to year until the reserve requirement is satisfied. The funds must be held in a federally insured account and the commission must set audit and reporting terms. Interest earned may be retained in the account and is subject to the same terms as the main body of the fund. The fund remains the property of the state and must be fully and promptly returned if the commission ceases to contract with the regional library system. SECTION 2. Effective date September 1, 1997. SECTION 3. Emergency clause. EXPLANATION OF AMENDMENTS The amendment of HB 2838 changes Section 1, Line 15 from may to shall.