By:  Moncrief                                          S.B. No. 515

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to cash reserves in regional library systems.

 1-2           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-3           SECTION 1.  Section 441.131, Government Code, is amended by

 1-4     adding Subsection (c) to read as follows:

 1-5           (c)  To ensure the sound management and viability of regional

 1-6     library systems, the commission shall include in its rules

 1-7     provisions stipulating a cash reserve requirement for regional

 1-8     library systems.  To enable the accumulation of sufficient reserves

 1-9     for the sole purpose of cash flow management, regional library

1-10     systems may retain up to five percent of their annual system

1-11     operation grant general revenue funds from year to year until the

1-12     commission's reserve requirement is satisfied.  These funds must be

1-13     held in a federally insured account and the commission may provide

1-14     for periodic reporting of the funds and their inclusion in the

1-15     annual audit.  Interest earned on these funds shall be retained in

1-16     this account and shall be subject to the same terms and reporting

1-17     as the corpus.  These funds remain the property of the state, and

1-18     if the commission ceases to contract with a regional library

1-19     system, such funds must be fully and promptly returned as provided

1-20     by this section.

1-21           SECTION 2.  This Act takes effect September 1, 1997.

1-22           SECTION 3.  The importance of this legislation and the

1-23     crowded condition of the calendars in both houses create an

 2-1     emergency and an imperative public necessity that the

 2-2     constitutional rule requiring bills to be read on three several

 2-3     days in each house be suspended, and this rule is hereby suspended.