JJG C.S.S.B. 932 75(R) BILL ANALYSIS
ECONOMIC DEVELOPMENT
C.S.S.B. 932
By: Sibley (Oliveira)
5-8-97
Committee Report (Substituted)
BACKGROUND
During the interim of the 74th Legislature, the Speaker appointed
the House Joint Committee
on State Loans and Grants to:
review the loan and grant programs sponsored by the state and its
agencies and to
assess the merits of administrative consolidation of selected
programs. The review
should focus on programs involving loans to individuals,
businesses, farms and
ranches, or non-profits organizations, but may consider other
programs similar in
nature.
One of the key findings of the committee is that "[t]he state
system of providing loans and
grants is difficult for users to access and understand." The
number of state agencies dealing loan and
grant programs to help a specific economic sector contributes to
the problem. The committee
concluded, "Forcing businesses to look to a wide variety of state
agencies makes it very difficult for
anyone eligible for assistance to find the right agency and next
to impossible to even consider finding
the right package of assistance from these agencies."
The House Joint Committee on Loans and Grants made the following
recommendation "to
the 75th Legislature to improve delivery, oversight and
efficiency of state loans and grant programs,
to enhance the state economic development efforts, and to aid the
state's debt management structure:
The Legislature should consider consolidating appropriate loan,
grant, and economic
development information programs and agencies to improve lending
and grant
making capabilities and to better coordinate programs.
PURPOSE
To create the Texas Economic Development Agency to administer
state agency loan and loan
guarantee programs and to engage in capital formation initiatives
to further the state's economic
development goals; to abolish the Texas Department of Commerce
and the Texas Agriculture
Finance Authority.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does expressly grant
rulemaking authority to the
Texas Economic Development Agency in: SECTION 4.03 by providing
for board rules for the call
of meetings; SECTION 4.08 by providing that the board by rule
shall establish a breakdown of
lending authority withing the development agency; and SECTION
4.18 by granting the board
authority to adopt rules regulating the economic emergency
assistance fund and the use of the money
in the fund. (While the bill does not expressly grant other
rulemaking authority to the Texas
Economic Development Agency it does transfer rulemaking authority
from other entities as follows:
SECTION 2.03 by transferring all powers of the Texas Department
of Commerce to the development
agency; SECTION 3.03 by transferring all powers of the Texas
Agricultural Finance Authority to
the development agency; SECTION 3.04 by granting the development
agency the powers and duties
related to the administration of the farm and ranch finance
program fund formerly assigned by the
constitution and law to the Texas Agricultural Finance Authority;
and SECTION 4.06 by transferring
to the development agency the powers and duties relating to
administering a program of an entity
required by other law to administer a loan or loan guarantee
program.
SECTION BY SECTION ANALYSIS
ARTICLE 1.FINDINGS; PURPOSE; AGENCY GOALS; DEFINITIONS
SECTION 1.01. Lists the Legislative Findings.
SECTION 1.02 Spells out the purpose and agency goals. Subsection
(a) states that the Texas
Economic Development Agency created by Article 4 of this Act is a
state
agency created to operate a consolidated economic development and
lending
agency, through consolidation of loan, grant, and market programs
aimed at
assisting business, helping governments assist business, and
service the
lending needs of groups of individuals targeted by the
legislature essential to
the well-being of the state.
Subsection (b) describes the goals of the development agency.
The agency
shall meet the needs of:
(1) business for low-cost capital to develop and promote new
products and to expand markets;
(2) expanding, relocating, or developing businesses for
information
on Texas' economic sectors, industries, markets, and communities;
(3) communities to offer incentives, including infrastructure
improvements and tax relief, to attract new businesses or expand
or
retain existing businesses;
(4) communities by facilitating and complementing the
development
of economic incentive packages;
(5) the people of this state for a vibrant economy capable of
creating
high-skill, high-wage jobs that pay a living wage;
(6) the taxpayers of this state to ensure that tax and bond
revenues for
economic development are spent and managed effectively and
efficiently; and
(7) the tourism industry of this state.
SECTION 1.03.Defines "board" and "development agency."
ARTICLE 2. ABOLITION OF TEXAS DEPARTMENT OF COMMERCE
SECTION 2.01.Repeals Chapter 481.002, Government Code, to abolish
the Texas
Department of Commerce (TDOC) as a state agency.
SECTION 2.02.Transfers all money, records, property, and
equipment of the TDOC to the
development agency on January 15, 1998.
SECTION 2.03.Transfers all powers, duties, functions, programs,
and activities of the TDOC
to the development agency on January 15, 1998.
SECTION 2.04Provides that a reference in law to the Texas
Department of Commerce is
considered to be a reference to the development agency.
SECTION 2.05Provides that if a provision of Subchapter A, Chapter
481, Government Code,
conflicts with a provision of Article 4 of this Act, Article 4 of
this Act
controls.
SECTION 2.06Effective date for this article is January 15, 1998.
ARTICLE 3. ABOLITION OF THE TEXAS AGRICULTURAL FINANCE AUTHORITY
SECTION 3.01.Repeals Section 58.011(a), Agriculture Code, to
abolish the Texas
Agricultural Finance Authority (TAFA).
SECTION 3.02.Transfers all money, records, property, and
equipment of the TAFA to the
development agency on May 1, 1998.
SECTION 3.03.Transfers all powers, duties, functions, programs,
and activities of the TAFA
to the development agency on May 1, 1998.
SECTION 3.04.Provides that the development agency is the
successor agency for purposes
of statutory and constitutional references to the TAFA. The
development
agency has the powers and duties related to the administration of
the farm and
ranch finance program fund formerly assigned by the constitution
and law to
the TAFA.
SECTION 3.05.Provides that if a provision of Subchapter B,
Chapter 58, Agriculture Code,
conflicts with a provision of Article 4 of this Act, Article 4 of
this Act
controls.
SECTION 3.06Effective date for this article is May 1, 1998.
ARTICLE 4. TEXAS ECONOMIC DEVELOPMENT AGENCY
SECTION 4.01.Establishes the Texas Economic Development Agency as
a state agency.
SECTION 4.02.Provides for board membership. Subsection (a)
establishes a nine member
board. Subsection (b) states the governor shall appoint the
members of the
board, and that four of the appointments shall be made as follows:
(1) one person who is an agricultural producer;
(2) one person who is an economic development professional who
represents an economic development organization;
(3) one person who represents the tourism industry; and
(4) one person who represents a small, locally owned community
bank.
Subsection (c) establishes the terms of board members at two
years, expiring
on February 1 of each odd numbered year.
SECTION 4.03.Provides that the governor select the presiding
officer from the board
members, and that the board shall meet at least monthly and at
the call of the
presiding officer or of a majority of the members, as provided by
board rule.
SECTION 4.04States the board members are not entitled to receive
compensation, but are
entitled to reimbursement of the member's travel expenses as
provided by the
General Appropriations Act.
SECTION 4.05Subjects the governmental body of the development
agency to the open
records laws, Chapter 552, Government Code, except that the
financial
records of an applicant or borrower are not public record. The
board is
subject to the open meetings law, Chapter 551, Government Code,
except
that an open meeting is not required to discuss the financial
matters of an
applicant or borrower.
SECTION 4.06.Grants, on full implementation of this Act, to the
development agency
exclusive authority to act as the administer of state agency loan
and loan
guarantee programs. Subject to Subsection (b), the powers and
duties relating
to administering a program of an entity administering a loan or
loan guarantee
program are transferred to the development agency, and the entity
shall
transfer all program records to the development agency.
Subsection (b)
provides that each entity from which a program is transferred
shall execute
a memorandum of understanding with the development agency
governing the
transfer, and that the transfer shall be accomplished in
accordance with the
memorandum. Subsection (c) states that the Texas Economic
Development
Agency shall serve as the administrator of all existing and
future state agency
loan and loan guarantee programs.
SECTION 4.07.Provides that the board shall employ a chief
operating officer who may
execute any of the board's powers and duties as delegated by the
board, and
may employ persons necessary for the management of the
development
agency.
SECTION 4.08Instructs the board, by rule, to establish a
breakdown of lending authority, and
instructs the chief operating officer to establish the loan
authority of agency
employees within board rules.
SECTION 4.09.Allows the development agency to enter into
participations to develop a
securitization program to sell into secondary markets.
SECTION 4.10.Provides that the state auditor or a private
auditing firm shall audit the
financial condition of the agency annually.
SECTION 4.11.Allows the agency to adopt a policy to market the
programs the agency
administers.
SECTION 4.12.Instructs the development agency and the Texas
Public Finance Authority to
jointly execute a memorandum of understanding relating to the
agency
retaining earnings that exceed the cost of bond retirement and
the costs of the
Texas Public Finance Authority.
SECTION 4.13.Allows the development agency to form a subsidiary
as determined necessary
by the agency.
SECTION 4.14.Instructs the board to adopt a written cash
management policy and review it
annually.
SECTION 4.15.Provides that an entity from which a program is
transferred shall perform, on
request of the development agency, technical services related to
program and
projects transferred from the entity. The development agency may
contract
with other entities to perform technical services.
SECTION 4.16.Allows the development agency to accept gifts and
grants form any private
or public source.
SECTION 4.17.Allows the excess earnings from program administered
by the development
agency to be pooled and used for any program administered by the
agency or
used to create an economic emergency assistance fund.
SECTION 4.18.Permits the board to create an economic emergency
assistance fund and adopt
rules regulating the fund and the use of money in the fund. The
board may
deposit earning from other programs administered by the agency
into the
economic emergency assistance fund.
SECTION 4.19.Permits the development agency to contract with a
private entity to perform
an activity related to a program transferred by this Act as long
as the activity
is not solely a sovereign function of the state.
SECTION 4.20.Effective date for this article is set as January
15, 1998.
ARTICLE 5. LEGISLATIVE OVERSIGHT COMMITTEE
SECTION 5.01.Subsection (a) establishes a legislative oversight
committee composed of six
members; three members of the Senate appointed by the Lieutenant
Governor; and three members of the House appointed by the
Speaker.
Subsection (b) instructs the Lieutenant Governor to appoint the
initial
presiding officer for a term ending January 31, 1999, and the
Speaker to
appoint the successor presiding officer for a term beginning
February 1, 1999.
Subsection (c) subjects the committee to Chapter 325, Government
Code
(Texas Sunset Act), and abolishes the committee August 31, 1999
unless
existence is continued under that chapter.
SECTION 5.02.Lists the powers and duties of the committee.
Subsection (a) instructs the
committee to meet quarterly with the board and receive
information regarding
rules adopted by the board or proposed for adoption. Subsection
(b) allows
the committee to request reports and other information relating
to the
operation of the board. Subsection (c) instructs the committee
to review the
specific recommendations for legislation proposed by the board.
SECTION 5.03.Subsection (a) instructs the committee to file a
report with the governor,
lieutenant governor, and the speaker not later than December 31
of each even
numbered year. Subsection (b) details the criteria for the
report.
SECTION 5.04. Effective date for this article is January 15, 1998.
ARTICLE 6. COMPTROLLER STUDY
SECTION 6.01.Provides for a comptroller's study. Subsection (a)
instructs the comptroller
to study the programs transferred by this act, and develop and
make
recommendations to the governor, lieutenant governor, and the
speaker
concerning the integrated structure of the development agency.
Subsection
(b) instructs each entity involved to cooperate with the
comptroller in
formulating and implementing a transition plan. Subsection (c)
instructs the
comptroller to report and recommend a structure of the
development agency
and transition of programs transferred to the governor,
lieutenant governor,
and the speaker not later than January 15, 1998. Subsection (d)
provides that
the development agency, after review of the comptroller's plan by
the
governor lieutenant governor, and the speaker, and to the extent
practicable,
implement the program transition in a manner consistent with the
comptroller's plan. Subsection (e) instructs each state agency
affected by the
transfer of programs to cooperate with the comptroller and the
development
agency in formulating and implementing a transition plan.
SECTION 6.02.Effective date for this article is September 1,
1997, and the expiration date is
August 31, 1999.
ARTICLE 7.TRANSFER OF CERTAIN PROPERTY, RECORDS, OBLIGATIONS,
FUNDS,
FUNCTIONS, PROGRAMS, AND ACTIVITIES TO DEVELOPMENT AGENCY
SECTION 7.01.On May 1, 1998, or earlier by interagency agreement,
the following
functions, programs, and activities are transferred to the
development agency:
(1) from the Texas Department of Housing and Community Affairs,
the community and economic development grants program;
(2) from the General Land Office, the recycled products market
expansion program;
(3) from the Parks and Wildlife Department, the public
information
program to communicate the state's natural and cultural resource
conservation message through various media; and
(4) from the Texas Department of Transportation, the travel
information program, other than the operation of the department's
Travel Information Centers, to support and promote tourism.
SECTION 7.02.Amends Section 9B(a), Texas Public Finance Authority
Act (Article 601d,
V.T.C.S.) to give the Texas Public Finance Authority the
exclusive authority
to act on behalf of the Texas Economic Development Agency in
issuing
bonds with respect to all bonds authorized to be issued by
entities to fund
programs administered by the development agency.
SECTION 7.03.Effective date for this article is January 15, 1998.
ARTICLE 8.TRANSFER OF CERTAIN PROPERTY, RECORDS, OBLIGATIONS,
FUNDS,
FUNCTIONS, PROGRAMS, AND ACTIVITIES TO DEVELOPMENT AGENCY
SECTION 8.01.Transfers, on May 1, 1998, the following functions,
programs, and activities
from the Texas Agricultural Finance Authority to the development
agency:
(1) TAFA loan guarantee program;
(2) linked deposit program;
(3) microenterprise support program;
(4) young farmers endowment program; and
(5) farm and ranch finance program.
ARTICLE 9. TEXAS DEPARTMENT OF BANKING REPORT
SECTION 9.01.Instructs the Texas Department of Banking to:
examine loans in programs
administered by the development agency for credit quality and
value;
recommend appropriate loan underwriting standards; and report its
recommendations to the governor, lieutenant governor, and speaker
not later
than August 1, 1998.
SECTION 9.02.Effective date for this article is January 1, 1998,
and the expiration date is
January 1, 1999.
ARTICLE 10. AUDITOR EVALUATION
SECTION 10.01.Instructs the state auditor to: evaluate the
management and fiscal control
systems of the development agency; recommend improvements to the
governor, the legislature, and the development agency; and
report the results
of the evaluation to the governor and the legislature not later
than December
1, 1998.
SECTION 10.02.Effective date of this article is January 15, 1998.
ARTICLE 11. TRANSFER OF PERSONNEL
SECTION 11.01.Provides that an employee of a program transferred
to the development
agency becomes an employee of the development agency on the date
the
program transfer is completed.
ARTICLE 12.AMENDMENT AND REPEAL OF CERTAIN FUNCTIONS, POWERS, AND
DUTIES OF THE TEXAS DEPARTMENT OF COMMERCE
SECTION 12.01.States that the amendment by this article of a
statute referring to the Texas
Department of Commerce or a division of the department does not
affect the
abolition of that department by this Act.
SECTION 12.02Amends Sec. 481.082, Government Code, to change the
legislative finding
of the Texas Rural Economic Development Act. Subsection (a) is
amended
to recognize that communities in this state are at a disadvantage
with
communities in this state and other states for the location or
expansion of
businesses because of available financial resources and other
incentives.
Subsection (b) is amended to focus the purposes of this
subchapter to the
promotion of economic development and employment in rural areas.
Subsection (c) states that the office of rural affairs shall
ensure that
assistance is provided to improve economic development conditions
and
opportunity for citizens in rural areas, and strikes giving
preference to
assisting the food and fiber processing industries.
SECTION 12.03Amends Sec. 481.083(7), Government Code, to amend
the definition of
"Rural area" to clarify that a rural area includes an area that
meets the
conditions of a rural area, as defined by the department.
SECTION 12.04Amends Sec. 481.0831, Government Code, to require
the department to hire
a rural director. The director must have a strong commitment and
involvement in rural affairs in the state.
SECTION 12.05Amends Sec. 481.088, Government Code, to list the
general duties of the
office of rural affairs and strikes the duties of the executive
director under the
Texas Rural Economic Development Act.
SECTION 12.06.Amends Sec. 481.089, Government Code, to list the
specific duties of the
office of rural affairs in order to carry out its duties under
Sec. 481.088,
Government Code. Strikes the current duties of the executive
director for
assessing the availability of rural economic development data
services and
the capability of data banks.
SECTION 12.07Amends Sec. 481.090, Government Code, to authorize
the department to:
employ and set the compensation of personnel to carry out the
functions
under this subchapter; consult with rural, economic and community
development experts, regulatory, legal, economic, or financial
experts and
individuals who represent the public interest. Strikes the duty
to and criteria
for assessing the availability of business information outreach
service offices
in Texas.
SECTION 12.08Amends Sec. 481.092, Government Code, to require
each state agency to
furnish the office of rural affairs, on request, with reports and
other
information necessary to carry out the functions of this
subchapter. Strikes
the comptroller's duty to review the implementation of Sections
481.088 -
481.090 and assess programs and activities authorized by those
sections.
Also removes the comptroller's requirement report to the
appropriate
committees of the legislature regarding the studies and analyses
prepared by
the executive director.
SECTION 12.09Amends Sec. 481.093, Government Code, to allow the
office of rural affairs
to accept gifts, grants, and donations, to perform specific
projects, studies, or
procedures or to provide assistance to small business.
SECTION 12.10Amends Subchapter F, Chapter 481, Government Code,
by adding Sec.
481.094 to require the department, not later than September 1 of
each even-
numbered year, to report to the governor and the legislature
information
regarding each of the functions performed by the office of rural
affairs,
including suggestions regarding issues critical to the rural
areas of this state.
SECTION 12.11Directs the executive director to employ a rural
affairs director as required by
Sec. 481.0831, Government Code, as amended by this article, not
later than
January 1, 1998.
SECTION 12.12. Amends Section 481.102, Government Code, to
provide that the Office of
Small Business Assistance shall be headed by a director of small
business.
Allows the office to accept gifts, grants, and donations form
sources other
than the state for purposes of performing certain projects to
provide
assistance to small businesses.
SECTION12.13.Amends Section 481.103(a), Government Code, so that
the office shall be a
"focal point" rather than an "advocate" for small businesses by
providing to
the legislature information on the effects of proposed policies
or actions;
assisting state agencies in determining the impact proposed rules
have on
small businesses as required by Section 2006.002; assisting the
agencies in
reducing the adverse effect that rules have on small businesses.
Strikes
requirement that the office to provide advice on administrative
and legislative
matters. The office shall evaluate the effectiveness of state
agencies and
other entities and make recommendations to the legislature and
state
agencies; identify regulations (rather than specific instances)
that inhibit
small business development; identify (rather than describe) the
reasons for
small and historically underutilized business (HUBs) successes
and failures;
serve as a focal point for comments (rather than complaints)
concerning
matters that affect small businesses and HUBs; (strikes language
requiring
the office to assist with the resolution of problems among state
agencies and
small and historically underutilized businesses) requires the
office to develop
and suggest (rather than advocate) proposals for changes in
matters that
adversely affect small businesses and HUBs, renumbers this and
subsequent
subsections; not be required to provide certain information to
legislative
committees; assist small businesses and HUBs by working with
relevant
organizations to identify (rather than establish) financing
programs, match
those businesses with sources of credit enhancement, assist those
businesses
with preparing applications for government loans, loan
guarantees, and credit
enhancement programs. Strikes language that requires the office
to develop
and implement programs to encourage certain entities to provide
useful
services to small and HUBs. The office shall identify potential
business
opportunities in economically distressed areas; enlist the
cooperation of
certain entities in disseminating information about programs and
services
provided by the state that benefit small businesses and how to
access such
services; defer to the small business stationary source
assistance program for
assistance related to environmental programs.
SECTION 12.14Amends Subchapter G, Chapter 481, Government Code,
by adding Section
481.109 to require the department to cooperate with the other
state agencies
by providing information as requested in an effort to carry out
the functions
of this subchapter.
SECTION 12.15Amends Sec.2006.002, Government Code, by adding
subsection (f) allowing
the a state agency to adopt provisions concerning
micro-businesses similar
to those outlined in Subsection (b) for small businesses.
SECTION 12.16Amends Section 481.155, Government Code, Subsection
(a) by stating the
legislature's intent that money from the smart jobs fund be spent
in all areas
of the state. Allows the executive director to award a grant or
a combination
of grants in any fiscal year to a single employer in excess of $1
million or at
a rate greater than 10 percent of the annual wages of the new or
existing job
being created or retained with the grant only if the employer
locates or
expands in an enterprise zone; the employer locates or expands in
an
adversely affected defense-dependent community; the employer
locates or
expands in an area having an unemployment rate of 1 1/2 times or
greater
than the statewide average; the employer locates or expands in a
county with
a population of less than 75,000; at least 25 percent of the
employees hired
or retained by the employer are economically disadvantaged
individuals; or
the employer is a small business or a micro-business. Renumbers
subsequent
subsections accordingly. Subsection (d) is amended to provide
that a grant
may not be awarded unless each employer participating in the
program
certifies that the starting wage for a new job will be equal to
or greater than
the prevailing wage for that occupation in the local labor
market, and that the
wage for an existing job will increase to the greater of (1)
three percent for
a small business or five percent for a business that is not a
small business, or
(2) 100 percent of the prevailing wage for that occupation in the
local labor
market area. Subsection (e) is amended so that an employer who
is a micro-
business may apply for a grant and request a modification of the
requirements in Subsection (d) and Section 481.159 (c) if:
substantial
changes in the skills required in the employer's business are
caused by
technological changes, the executive director determines that
other reasonable
factors exist. Renumbers subsequent subsections.
SECTION 12.17Amends Section 481.172, Government Code, substitute
"distribution
channels" instead of "agencies, including the United States
Travel and
Tourism Agency." Makes conforming changes to refer to the Texas
Department of Transportation instead of the Texas Transportation
Commission. Strikes "in this state" so that the Department shall
encourage
communities, organizations, and individuals in and out of state
to use their
own funds in the pursuit of the objectives of this subchapter.
SECTION 12.18Amends Section 481.221, Government Code, by deleting
the obsolete
definition of "office" meaning Office of Advanced Technology
within the
Texas Department of Commerce. Makes conforming changes by
renumbering subsections to reflect this amendment and codify a
1995
amendment.
SECTION 12.19Repeals Chapter 146, Education Code, to abolish the
unfunded Texas-Mexico
Development Fund.
SECTION 12.20Repeals Section 481.061, Government Code, to abolish
unused authority to
explore, develop, and negotiate interstate compacts with
officials of the
United Mexican States or any of its political subdivisions or any
other foreign
trading partners.
SECTION 12.21Repeals Subchapters R, T, U, and V, Chapter 481,
Government Code, to
abolish: the unfunded Small Business Incubators Program; the
unused
authority to indemnify against loss or damage art and artifacts;
the unfunded
Product Commercialization Program; and the unfunded Small
Business
Innovation Research Program.
SECTION 12.22Repeals Chapter 483, Government Code, to abolish the
unfunded Texas
Business Enhancement Fund.
ARTICLE 13. BOARD APPOINTMENT; EMERGENCY
SECTION 13.01Instructs the governor to appoint the initial
members of the board in a timely
manner so that a quorum has qualified for office not later than
January 15,
1998. The term of each initial board member expires February 1,
1999.
SECTION 13.02Emergency clause.
COMPARISON OF ORIGINAL TO SUBSTITUTE
S.B. 932, as engrossed, would abolish the Texas Department of
Commerce (TDOC) and create the
Texas Department of Economic Development and Tourism (TDEDT).
All powers and duties of the
TDOC would transfer to the TDEDT, and the governing structure of
TDOC - an executive director
appointed by the governor and confirmed by the senate - would
change to a 9 member board at
TDEDT. S.B. 932 also deletes several provisions of TDOC enabling
statutes which were never
funded by the legislature. The bill would privatize two TDOC
programs; the Texas Manufacturing
Assistance Centers and the Capital Certified Development
Corporation.
C.S.S.B. 932 would abolish the TDOC and the Texas Agricultural
Finance Authority and create the
Texas Economic Development Agency. The committee substitute
would combine the staff of the
two abolished agencies to form the new agency. In addition, the
committee substitute would transfer
program staff and funding involved in economic development
activity from several different
agencies including: the General Land Office; the Department of
Housing and Community Affairs;
Parks and Wildlife Department; and the Texas Department of
Transportation. C.S.S.B. 932 also
amends statutes concerning the Office of Small Business
Assistance, the Smart Jobs Fund program,
and rural economic development directives by creating the Office
of Rural Affairs. Additionally,
the committee substitute also deletes several provisions of TDOC
enabling statutes which were never
funded by the legislature.
The following side-by-side comparison addresses the differences
from the original to the substitute
in greater detail.
Side-by-Side Comparision of S.B. 932 to C.S.S.B. 932
S.B. 932
C.S.S.B. 932
SECTION 1. Changes heading of Chapter 481,
Government Code to "Texas Department of Economic
Development and Tourism.
ARTICLE 1. SECTION 1.01. Lists the
legislative findings.
SECTION 2. Amends definitions to add
"Governing Board" and "Texas Department of Economic
Development and Tourism" (TDEDT).
SECTION 1.02. Lists the purpose
and agency goals of the Texas Economic Development Agency (TEDA).
SECTION 3. Amends Sec. 481.002, Government Code, to establish
the TDEDT as a state agency.
SECTION 1.03. Defines "board" and
"Development Agency" for this Act.
SECTION 4. Amends Sec. 481.003
to change TDOC to TDEDT and set a sunset date for TDEDT on
September 1, 2001.
ARTICLE 2. SECTION 2.01. Repeals Sec. 481.002,
Government Code, to abolish the TDOC.
SECTION 5. Amends Sec.
481.004, Government Code, to establish a governing board over the
TDEDT
composed of nine members, appointed for six year terms, with
certain criteria.
SECTION 2.02. Transfers all money, records,
property, accounts, and equipment from TDOC to TEDA on
January 15, 1998.
SECTION 6. Makes conforming amendments to Sec.
481.0041, Government Code to change policy board
to governing board.
SECTION 2.03. Transfers all powers, duties,
functions, programs, funds, and activities from TDOC to
TEDA on January 15, 1998.
SECTION 7. Makes conforming amendments
to Sec. 481.0042(a), (b), and (e), Government Code, to
change policy board to governing board.
SECTION 2.04. Provides
that references in law to TDOC is considered a reference to TEDA.
SECTION 8. Makes conforming amendment to Sec. 481.0043,
Government Code, to change policy board
to governing board
SECTION 2.05. Provides that Article 4 of this
Act controls if there is a conflict with a provision of
Subchapter A, Chapter 481., Government Code.
SECTION 9. Makes
conforming amendment to Sec. 481.0044, Government Code, to change
policy board
to governing board, and prescribes the contents of the report the
governing body is to submit to the governor
and legislature annually.
SECTION 2.06. Sets the effective date
of the article as January 15, 1998.
SECTION 10. Makes conforming
amendments to Sec. 481.005, Government Code, to change policy
board
to governing board and modify and clarify the duties of the board
and the executive director.
ARTICLE 3. SECTION 3.01. Repeals Sec.
58.001(a), Agriculture Code, to abolish the Texas Agricultural
Finance Authority (TAFA).
SECTION 11. Amends Sec. 481.006,
Government Code, to change executive director to governing board
and alter the divisions within the department the governing board
may establish.
SECTION 3.02. Transfers all money, records,
property, accounts, and equipment from TAFA to TEDA on
May 1, 1998.
SECTION 12. Adds Sec. 481.0065 to the Government
Code, to establish the Office of Defense Affairs.
SECTION 3.03.
Transfers all powers, duties, functions, programs, and activities
from TAFA to TEDA on
May 1, 1998.
SECTION 13. Amends Sec. 481.007, Government Code, to change
advisory boards to advisory committees
and policy board to governing board.
SECTION 3.04. Establishes
TEDA as the successor to TAFA for statutory and constitutional
purposes.
SECTION 14. Makes conforming changes to 481.010(a),
(b), and (c) to change policy board to governing
board.
SECTION 3.05. Provides that Article 4 of this Act controls
if there is a conflict with a provision of
Subchapter B, Chapter 58, Agriculture Code.
SECTION 15. Makes
conforming amendments to 481.012, Government Code, to change
policy board to
governing board.
SECTION 3.06. Establishes the effective date of
this article as May 1, 1998.
SECTION 16. Establishes the general
duties of the TDEDT.
ARTICLE 4. SECTION 4.01. Establishes TEDA as
a state agency.
SECTION 17. Amends Sec. 481.023, Government Code,
to reduce TDEDT's duties to administer other
statutes.
SECTION 4.02. Establishes a nine member board over TEDA
and list the criteria for board membership.
Establishes the length of term as two years
SECTION 18. Amends
Sec. 481.024(a) and (f) to change policy board to governing board
and TDOC to
TDEDT.
SECTION 4.03. Provides for the governor to select the
presiding officer of the board and that the board
shall meet at least monthly.
SECTION 19. Amends Sec. 481.028(b) ,
Government Code, to require the TDEDT to enter into agreements
with those entities TDOC was required to enter into agreements
with and add the Texas Workforce
Commission, and delete the Texas Higher Education Coordinating
Board and the Texas Department of
Human Services.
SECTION 4.04. States that board members are not
entitled to compensation, but are entitled to
reimbursement for travel expenses.
SECTION 20. Amends Sec.
481.029, Government Code, to allow TDEDT to recover cost for
"other
services" to business and communities.
SECTION 4.05. Subjects
TEDA and the board to open records and open meetings laws.
SECTION
21. Amends Subchapter B, Chapter 481, Government Code, to
establish the Texas Strategic
Economic Development Planning Commission. Lists the composition
requirements of the commission and
the duties of the commission, including the development of a
strategic plan by November 1, 1998. Abolishes
the commission on February 1, 1999.
SECTION 4.06 Grants, on full
implementation of this Act, exclusive authority over the program
transferred
by this Act to the TEDA.
SECTION 22. Changes the heading of
Subchapter D, Chapter 481, Government Code, to International
Trade.
SECTION 4.07. Requires the board to employ a chief
operating officer. and allows the COO to employ
persons for the proper management of the agency.
SECTION 23.
Amends Sec. 481.041, Government Code, to amend legislative
findings concerning
international trade.
SECTION 4.08. Requires the board to
establish a breakdown of lending authority and requires the COO
to establish loan authority for employees.
SECTION 24. Amends
Sec. 481.043, Government Code, to amend the general powers and
duties of the
department relating to international trade.
SECTION 4.09. Allows
TEDA to enter into participations in secondary markets.
SECTION
25. Amends Sec. 481.059, Government Code, to simply statute
concerning the Texas exporters
loan fund.
SECTION 4.10. Provides for annual audits of the
financial condition of TEDA.
SECTION 26. Amends the heading of
Subchapter E, Chapter 481, Government Code, to read Business
Development--General Provisions.
SECTION 4.11. Allows TEDA to
develop a marketing policy for its programs.
SECTION 27. Amends
Sec. 481.071, Government Code, to change the legislative findings
for business
development.
SECTION 4.12. Directs TEDA and the Texas Public
Finance Authority to execute a memorandum of
understanding relating to the agency retaining earnings that
exceed the costs of bond retirement and costs
of the Texas Public Finance Authority.
SECTION 28. Amends
Subchapter E, Chapter 481, Government Code, by adding Sec.
481.0725 to list the
general powers and duties of TDEDT regarding business
development.
SECTION 4.13. Allows TEDA to form subsidiaries as
determined necessary by the agency.
SECTION 29. Amends Sec.
481.073, Government Code, to change policy board to governing
board.
SECTION 4.14. Requires the board to adopt a written cash
management policy and review it annually.
SECTION 30. Amends Sec.
481.075, Government Code, to change policy board to governing
board.
SECTION 4.15. Provides than an entity from which a program
is transferred shall perform technical
services related to the program on request of TEDA.
SECTION 31.
Amends Section 481.077, Government Code, by adding Subsection (f)
to require TDEDT
to transfer the Statewide Certified Development Corporation to
the private sector by June 1, 1999.
SECTION 4.16. Allows TEDA to
accept gifts and grants.
SECTION 32. Amends the heading of
Subchapter H, Chapter 481, Government Code, to read Business
Development--Permit Assistance.
SECTION 4.17. Allows excess
earning from TEDA programs to be pooled and used for other agency
programs or used to create an economic emergency assistance fund.
SECTION 33. Amends the heading of Subchapter J, Chapter 481,
Government Code, to read Business
Development--Smart Jobs.
SECTION 4.18. Allows the board to create
an economic emergency assistance fund and deposit earnings
from other programs into the fund.
SECTION 34. Amends Sec.
481.153, Government Code, to change policy board to governing
board.
SECTION 4.19. Allows TEDA to contract with private
entities to perform activities which are not solely
a sovereign function of the state.
SECTION 35. Amends Sec.
481.157(b), Government Code, to change policy board to governing
board.
SECTION 4.20. Sets the effective date of this article for
January 15, 1998.
SECTION 36. Amends Sec. 481.172, Government
Code, to add new duties and delete other duties of
TDEDT regarding tourism.
ARTICLE 5. SECTION 5.01. Establishes a
legislative oversight committee, outlines membership, and
sunsets the committee on August 31, 1999.
SECTION 37. Amends the
heading of Subchapter N, Chapter 481, Government Code to read
Business
Development--Linked Deposit Program.
SECTION 5.02. Outlines the
powers and duties of the committee.
SECTION 38. Amends Chapter
481, Government Code to by adding Subchapters K and P.
Subchapter K
establishes the Texas Business and Community Economic Development
Clearinghouse. Subchapter P
establishes TDEDT's powers and duties regarding research and data
services.
SECTION 5.03. Requires the committee to report to the
governor, lt. governor, and speaker not later than
December 31 of each even-numbered year. Outlines report
requirements.
SECTION 39. Amends Chapter 484, Government Code,
regarding the Texas Manufacturing Institute to
establish it as a nonprofit corporation, establish a governing
board, provide confidentiality provisions,
establish funding, grant immunity to board members, and mandate
the institute's transfer to the private sector.
ARTICLE 6. SECTION
6.01. Requires the comptroller to study the programs transferred
and develop
recommendations which, to the greatest extent practicable, TEDA
will implement as a transition plan.
SECTION 40. (a) Repealers:
Sections 481.0075, 481.026, 481.042, 481.044, 481.046,
481.048-481.058,
481.060, 481.061, 481.074, 481.078, 481.081-481.0831,
481.0841-481.086, 481.088-481.093, and 483.001-
483.006, Government Code (Texas-Mexico Authority, Literacy,
Definitions, Powers and Duties Relating
to Financing, Honorary Commercial Attache Program, Program Rules,
Tax Exemption; Exempt Securities,
Conflicts of Interest, Personal Liability of Members of Persons
Acting on Behalf of Department, Revenue
Bonds Authorized, Bond Sale and Issuance, Agreements in Bonds,
Refunding Bonds, Bond Proceeds;
Funds, Tax Exemption, Obligations as Legal Investments for
Fiduciaries, Electronic Data Base, Compact
Exploration With the United Mexican States, Bonds, and Major
Employer Development Programs, Short
Title, Purpose, Definitions, Office of Rural Affairs, Payments
not to be Made to Defaulting Users,
Guarantee-to-Reserve Ratio, Penalty for False Information on
Application, Additional Powers and Duties,
Directive, Criteria, Business Service Outreach Study, Expired,
Review, Gifts and Grants, Definitions, Texas
Business Enhancement Fund; Creation and Administration, Powers of
Department, Support to Department
by Other State Departments and Agencies, Provisions Relating to
Loan Guarantees, Reports; Audits).
(b) Repealers: Subchapters G, I, M, Q, R, S, T, U, V, X, and Y,
Chapter 481, Government Code (Small
Business Assistance, State and Local Permits, Data Depository,
Development of Products, Small Business
Incubators, Shared Foreign Sales Corporations, Indemnification in
Connection with Art and Artifacts,
Product Commercialization, Small Business Innovation Research,
International Trade Commission, At Risk
Youth and Dropouts).
(c) Repealer: Chapter 481AA, Government Code (Workforce
Development Incentive for Youth; Recycling
Market Development).
SECTION 6.02. Establishes the effective date of this article as
September 1, 1997, and expiration date as
August 31, 1999.
SECTION 41. Establishes the effective date as September 1, 1997.
Transfers powers and duties of TDOC
to TDEDT. Provides for the timing of appointments, allows the
executive director of TDOC to continue to
perform those duties and complete the term of office. Grants
TDEDT all the powers, duties, property, funds,
rules, employees unspent appropriations, documents, right and
obligations of TDOC. Carries all rules,
policies, procedures, and decisions of TDOC to exist until
superseded by TDEDT.
ARTICLE 7. SECTION 7.01. Transfers program
from other agencies to TEDA on May 1, 1998.
SECTION 7.02. Amends
Section 9B(a), Texas Public Finance Authority Act to add TEDA
bonds to the list
of bonds the TPFA can issue.
SECTION 7.03. Establishes the
effective date of this article as January 15, 1998.
ARTICLE 8.
SECTION 8.01. Transfers TAFA programs to TEDA on May 1, 1998.
ARTICLE 9. SECTION 9.01. Requires the Texas Department of
Banking to examine the loans in programs,
recommend underwriting standards, and report by August 1, 1998.
SECTION 9.02. Establishes the effective date of this article as
January 1, 1998 and the expiration date as
January 1, 1999.
ARTICLE 10. SECTION 10.01. Requires the state
auditor evaluate the management and fiscal controls of
TEDA.
SECTION 10.02. Establishes the effective date of this
article as January 1 5, 1998.
ARTICLE 11. SECTION 11.01. Provides
for the transfer of employees of the programs transferred.
ARTICLE
12. SECTION 12.01. States that an amendment by this article to
TDOC statute does not affect
the abolition of TDOC.
SECTION 12.02. Amends Sec. 481.082,
Government Code, to change the legislative findings for Rural
Economic Development.
SECTION 12.03. Amends Sec. 481.083(7),
Government Code, to modify the definition of rural area.
SECTION
12.04. Amends Sec. 481.0831, Government Code, to establish a
rural affairs director and list
requirements.
SECTION 12.05. Amends Sec. 481.008, Government Code, to list the
general duties of the office of rural
affairs.
SECTION 12.06. Amends Sec. 481.089, Government Code, to
list specific duties of office of rural affairs.
SECTION 12.07.
Amends Sec. 481.090, Government Code, to allow for staffing and
powers of the office
of rural affairs.
SECTION 12.08. Amends Sec. 481.092, Government
Code, to require state agencies, on request, to furnish
reports and other information to the office of rural affairs.
SECTION 12.09. Amends Sec. 481.093, Government Code, to allow
the office of rural affairs to accept
gifts, grants, and donations.
SECTION 12.10. Amends Subchapter F,
Chapter 481, Government Code, to require the office of rural
affairs to report certain information.
SECTION 12.11. Directs the
executive director to employ a rural affairs director by January
1, 1998.
SECTION 12.12. Amends Sec. 481.102, Government Code, to
provide for a small business director, and
allow the office of small business assistance to accept gifts,
grants and donations.
SECTION 12.13. Amends Sec. 481.103(a),
Government Code, to change the duties of the office of small
business assistance.
SECTION 12.14. Amends Subchapter G, Chapter
481, Government Code, to add Sec. 481.109 to require
state entities to furnish reports and other information to the
office of small business assistance.
SECTION 12.15. Amends Sec.
2006.002, Government Code, to allow state agencies to adopt
provisions
concerning micro-businesses.
SECTION 12.16. Amends Sec. 481.115,
Government Code, to change requirements for grants under the
Smart Jobs program.
SECTION 12.17. Amends Sec. 481.172,
Government Code, change the duties and make conforming
changes to TDOC's requirements regarding tourism.
SECTION 12.18. Amends Sec. 481.221, Government Code, delete the
definition of the Office of Advanced
Technology.
SECTION 12.19. Repeals Chapter 146, Education Code.
SECTION 12.20. Repeals Sec. 481.061, Government Code.
SECTION
12.21. Repeals Subchapters R, T, U, and V, Chapter 481,
Government Code.
SECTION 12.22. Repeals Chapter 483, Government
Code.
ARTICLE 13. SECTION 13.01. Directs the governor to appoint
the TEDA board members by January 15,
1998, with terms expiring February 1, 1999.
SECTION 13.02.