JBM S.J.R. 17 75(R)BILL ANALYSIS
NATURAL RESOURCES
S.J.R. 17
By: Brown (Lewis, Ron)
5-1-97
Committee Report (Unamended)
BACKGROUND
Currently, the Texas Water Development Fund functions under the
supervision of the Texas Water Development Board (TWDB). There are
concerns that the availability of bonds for water supply financing is in
danger of becoming exhausted in the near future.
The TWDB is also required to pre-fund a reserve within the I&S fund for
Agricultural Water Conservation Bonds at the end of each fiscal year for
the payment of next year's debt service.
This legislation creates the Texas Water Development Fund II and
authorizes the TWDB to administer the fund and issue general obligation
bonds for the purposes of the fund. By consolidating existing bond
authorizations among categories, the state could more efficiently manage
bond authorizations. This bill also allows the board to utilize loan
repayments coming into the fund after the end of the fiscal year to make
bond debt service payments.
PURPOSE
To require the submission to the voters of a constitutional amendment that
creates the Texas Water Development Fund II, authorizes the TWDB to
administer the fund and issue general obligation bonds for the purposes of
the fund, and provides certain conditions for the flow of funds for
repayment of Texas agricultural water conservation 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 III, Texas Constitution, by adding Section
49-d-8, as follows:
Sec. 49-d-8. (a) Creates the Texas Water Development Fund II in the
state treasury as a fund separate and distinct from the Texas Water
Development Fund established under Section 49-c of Article III, Texas
Constitution. Requires the money in the Texas Water Development Fund II
to be administered without further appropriation by the TWDB and used for
any one or more of the purposes authorized by Sections 49-c, 49-d, 49-d-1,
49-d-2, 49-d-5, 49-d-6, and 49-d-7 of Article III, Texas Constitution, as
determined by the TWDB. Requires separate accounts to be established in
the Texas Water Development Fund II for administering proceedings related
to the purposes described in Section 49-d of Article III, Texas
Constitution, the purposes described in Subsection (e) of Section 49-d-7
of Article III, Texas Constitution, and all other authorized purposes.
Authorizes the TWDB, at its determination, to issue general obligation
bonds for one or more accounts of the Texas Water Development Fund II in
an aggregate principal amount equal to the amount of bonds authorized
pursuant to Sections 49-d-2, 49-d-6, and 49-d-7 of Article III, Texas
Constitution, less the amount of bonds issued pursuant to those sections
to augment the Texas Water Development Fund. Provides, however, that
nothing in this section shall grant to the TWDB the authority to issue
bonds under this section and under Sections 49-d2, 49-d-6, and 49-d-7 of
this Article 3, Texas Constitution, in excess of the total amount of
authorized bonds described in Sections 49-d-2, 49-d-6, and 49-d-7 of
Article III, Texas Constitution, or to issue bonds for purposes described
in Subsection (e) of Section 49-d-7 of Article III, Texas Constitution,
in excess of $250,000,000. Authorizes the expenses of the TWDB in
connection with the issuance of bonds for an account of the Texas Water
Development Fund II and administration of such account to be paid from
money in such account.
(b) Authorizes the TWDB, at its determination, to issue general
obligation bonds for one or more accounts of the Texas Water Development
Fund II in order to refund outstanding bonds previously issued to augment
the Texas Water Development Fund, as long as the principal amount of the
refunding bonds does not exceed the outstanding principal amount of the
refunded bonds, and to refund the general obligation of the State of Texas
under long-term contracts entered into by the TWDB with the United States
or any of its agencies under authority granted by Section 49-d of Article
III, Texas Constitution,, as long as the principal amount of the refunding
bonds does not exceed the principal amount of the contractual obligation
of the TWDB. Requires the money and assets in the Texas Water Development
Fund attributable to such refunding bonds to be transferred to the
appropriate account of the Texas Water Development Fund II, as determined
by the TWDB, under certain conditions concerning outstanding bonds and
terms of some long-term contracts. Requires, at such time as all bonds
issued to augment the Texas Water Development Fund and all such
contractual obligations have been paid or otherwise discharged, all money
and assets in the Texas Water Development Fund to be transferred to the
credit of the Texas Water Development Fund II and deposited to the
accounts therein, as determined by the TWDB.
(c) Requires the legislature to provide terms and conditions, subject to
the limitations set forth in Section 49-d of Article III, Texas
Constitution, under which the TWDB may sell, transfer, or lease, in whole
or part, facilities held for the account established within the Texas
Water Development Fund II for administering proceedings related to the
purposes described in Section 49-d of Article III, Texas Constitution, and
authorizes the legislature to provide terms and conditions under which the
TWDB may sell any unappropriated public waters of the state that may be
stored in such facilities. Requires money received from any sale,
transfer, or lease of such facilities or water to be credited to the
account established within the Texas Water Development Fund II for the
purpose of administering proceedings related to the purposes described in
Section 49-d of Article III, Texas Constitution.
(d) Requires each account of the Texas Water Development Fund II to
consist of: the TWDB's rights to receive repayment of financial assistance
provided from such account, together with any evidence of such rights;
money received from the sale or other disposition of the TWDB's rights to
receive repayment of such financial assistance; money received as
repayment of such financial assistance; money and assets attributable to
bonds issued and sold by the TWDB for such account, including money and
assets transferred from the Texas Water Development Fund pursuant to this
section; money deposited in such account pursuant to Subsection (c) of
this section; payments received by the TWDB under a bond enhancement
agreement as authorized by law with respect to bonds issued for such
account; and interest and other income received from investment of money
in such account.
(e) Provides that, notwithstanding certain provisions of Sections 49-d-2,
49-d-6, and 49-d-7 of Article III, Texas Constitution, requires the
principal of and interest on the general obligation bonds issued for an
account of the Texas Water Development Fund II, including payments by the
TWDB under a bond enhancement agreement as authorized by law with respect
to principal of or interest on such bonds, to be paid out of such account,
but authorizes the money in such account that is not immediately committed
to the purposes of such account or the payment of expenses to be invested
as authorized by law until the money is needed for those purposes. If
there is not enough money in any account available to pay the principal of
and interest on the general obligation bonds issued for such account,
including money to make payments by the TWDB under a bond enhancement
agreement as authorized by law with respect to principal of or interest on
such bonds, there is appropriated by this constitution an amount that is
sufficient to pay the principal of and interest on such general
obligations bonds that mature or become due during that fiscal year or to
make bond enhancement payments with respect to those bonds.
(f) Authorizes the general obligation bonds authorized by this section to
be issued as bonds, notes, or other obligations as permitted by law and
requires these bonds to be sold in a certain manner determined by the
TWDB. Requires the bonds to bear a rate or rates of interest the TWDB
determines. Requires the bonds authorized by this section to be
incontestible after execution by the TWDB, approval by the attorney
general, and delivery to the purchaser or purchasers of the bonds.
(g) Provides that there is hereby reposed in the legislature full power
to implement and effectuate the design and objects of this section,
including the power to delegate such duties, responsibilities, functions,
and authority to the TWDB as it believes necessary. Provides that this
section is intended only to establish a basic framework and not to be a
comprehensive treatment of the Texas Water Development Fund II.
SECTION 2. Amends Section 50-d(c), Article III, Texas Constitution, to
delete the language mandating the deduction of the amount of the sinking
fund at the close of the prior fiscal year from the state's obligations
toward repaying agricultural water conservation bonds.
SECTION 3. Requires this proposed constitutional amendment to be submitted
to the voters at an election to be held November 4, 1997. Sets forth the
required language for the ballot.