75R14624 E                          

         By Sibley                                              S.B. No. 932

         Substitute the following for S.B. No. 932:

         By Oliveira                                        C.S.S.B. No. 932

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to abolishing the Texas Department of Commerce and the

 1-3     Texas Agricultural Finance Authority and transferring the powers

 1-4     and duties of the agencies to the newly created Texas Economic

 1-5     Development Agency to administer state agency loan and loan

 1-6     guarantee programs and to engage in capital formation initiatives

 1-7     to further the state's economic and agricultural development goals.

 1-8           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-9          ARTICLE 1.  FINDINGS; PURPOSE; AGENCY GOALS; DEFINITIONS

1-10           SECTION 1.01.  LEGISLATIVE FINDINGS.  The legislature finds

1-11     that:

1-12                 (1)  the economic future of Texas and its citizens

1-13     depends on the ability of businesses to secure low-cost capital

1-14     that promotes the high-quality jobs that improve the living

1-15     standards of all Texans;

1-16                 (2)  the voters of Texas and the legislature have

1-17     created many programs within several state agencies that offer

1-18     hundreds of millions of dollars to assist businesses and

1-19     individuals to create jobs, sustain economic viability, own land,

1-20     and promote other activities deemed critical to Texas;

1-21                 (3)  having loan and grant programs spread through many

1-22     different agencies makes it very difficult for businesses and

1-23     individuals to access programs designed to assist them;

1-24                 (4)  these loan and grant programs represent a

 2-1     substantial financial liability to the state's general revenue

 2-2     fund;

 2-3                 (5)  consolidating the current fragmented system will

 2-4     improve the state's ability to control its liabilities and business

 2-5     activities;

 2-6                 (6)  economic and administrative efficiencies can be

 2-7     gained by consolidating some of the loan and grant programs into

 2-8     one agency;

 2-9                 (7)  consumer access to the state's loan and grant

2-10     programs can be improved by consolidating some of the loan and

2-11     grant programs into one agency with one marketing effort offering

2-12     "one-stop shopping"; and

2-13                 (8)  the quality and efficiency of the programs can be

2-14     improved by consolidation.

2-15           SECTION 1.02.  PURPOSE; AGENCY GOALS.  (a)  The Texas

2-16     Economic Development Agency created as provided by Article 4 of

2-17     this Act is a state agency created to operate a consolidated

2-18     economic development and lending agency, in particular through the

2-19     consolidation of loan, grant, and market programs aimed at

2-20     assisting business, helping governments assist business, and

2-21     servicing the lending needs of groups of individuals targeted by

2-22     the legislature essential to the well-being of Texas.

2-23           (b)  The development agency with programs established by the

2-24     voters and the legislature shall meet the needs of:

2-25                 (1)  business for low-cost capital to develop and

2-26     promote new products and to expand markets;

2-27                 (2)  expanding, relocating, or developing businesses

 3-1     for information on Texas' economic sectors, industries, markets,

 3-2     and communities;

 3-3                 (3)  communities to offer incentives, including

 3-4     infrastructure improvements and tax relief, to attract new

 3-5     businesses or expand or retain existing businesses;

 3-6                 (4)  communities by facilitating and complementing the

 3-7     development of economic incentive packages;

 3-8                 (5)  the people of this state for a vibrant economy

 3-9     capable of creating high-skill, high-wage jobs that pay a living

3-10     wage;

3-11                 (6)  the taxpayers of this state to ensure that tax and

3-12     bond revenues for economic development are spent and managed

3-13     effectively and efficiently; and

3-14                 (7)  the tourism industry in this state.

3-15           SECTION 1.03.  DEFINITIONS.  In this Act:

3-16                 (1)  "Board" means the board of the development agency.

3-17                 (2)  "Development agency" means the Texas Economic

3-18     Development Agency.

3-19            ARTICLE 2.  ABOLITION OF TEXAS DEPARTMENT OF COMMERCE

3-20           SECTION 2.01.  ABOLITION OF TEXAS DEPARTMENT OF COMMERCE.

3-21     Section 481.002, Government Code, is repealed and the Texas

3-22     Department of Commerce is abolished.

3-23           SECTION 2.02.  TRANSFER OF PROPERTY.   All money, records,

3-24     property, accounts, and equipment in the custody of the Texas

3-25     Department of Commerce shall be transferred to the custody of the

3-26     development agency on January 15, 1998.

3-27           SECTION 2.03.  TRANSFERS.  On January 15, 1998, all powers,

 4-1     duties, functions, programs, funds, and activities of the Texas

 4-2     Department of Commerce are transferred to the development agency.

 4-3           SECTION 2.04.  REFERENCES TO DEPARTMENT.  A reference in law

 4-4     to the Texas Department of Commerce is considered to be a reference

 4-5     to the development agency.

 4-6           SECTION 2.05.  CONFLICT OF LAWS.  If a provision of

 4-7     Subchapter A, Chapter 481, Government Code, conflicts with a

 4-8     provision of Article 4 of this Act, Article 4 of this Act controls.

 4-9           SECTION 2.06.  EFFECTIVE DATE.  This article takes effect

4-10     January 15, 1998.

4-11        ARTICLE 3.  ABOLITION OF TEXAS AGRICULTURAL FINANCE AUTHORITY

4-12           SECTION 3.01.  ABOLITION OF TEXAS AGRICULTURAL FINANCE

4-13     AUTHORITY.  Section 58.011(a), Agriculture Code, is repealed and

4-14     the Texas Agricultural Finance Authority is abolished.

4-15           SECTION 3.02.  TRANSFER OF PROPERTY.  All money, records,

4-16     property, accounts, and equipment in the custody of the Texas

4-17     Agricultural Finance Authority shall be transferred to the custody

4-18     of the development agency on May 1, 1998.

4-19           SECTION 3.03.  TRANSFERS.  On May 1, 1998, all powers,

4-20     duties, functions, programs, and activities of the Texas

4-21     Agricultural Finance Authority are transferred to the development

4-22     agency.

4-23           SECTION 3.04.  SUCCESSOR AGENCY.  The development agency is

4-24     the successor agency for purposes of statutory and constitutional

4-25     references to the Texas Agricultural Finance Authority.  The

4-26     development agency has the powers and duties related to the

4-27     administration of the farm and ranch finance program fund formerly

 5-1     assigned by the constitution and law to the Texas Agricultural

 5-2     Finance Authority.

 5-3           SECTION 3.05.  CONFLICT OF LAWS.  If a provision of

 5-4     Subchapter B, Chapter 58, Agriculture Code, conflicts with a

 5-5     provision of Article 4 of this Act, Article 4 of this Act controls.

 5-6           SECTION 3.06.  EFFECTIVE DATE.  This article takes effect May

 5-7     1, 1998.

 5-8                ARTICLE 4.  TEXAS ECONOMIC DEVELOPMENT AGENCY

 5-9           SECTION 4.01.  TEXAS ECONOMIC DEVELOPMENT AGENCY.  The Texas

5-10     Economic Development Agency is an agency of the state.

5-11           SECTION 4.02.  BOARD MEMBERSHIP.  (a)  The board is composed

5-12     of nine members as provided by this section.

5-13           (b)  The governor shall appoint the members of the board.

5-14     Four of the appointments shall be made as follows:

5-15                 (1)  one person who is an agricultural producer;

5-16                 (2)  one person who is an economic development

5-17     professional who represents an economic development organization;

5-18                 (3)  one person who represents the tourism industry;

5-19     and

5-20                 (4)  one person who represents a small, locally owned

5-21     community bank.

5-22           (c)  A  member of the board serves for a term of two years

5-23     expiring on February 1 of each odd-numbered year.

5-24           SECTION 4.03.  PRESIDING OFFICER; MEETINGS.  (a)  The

5-25     governor shall select a presiding officer from the board members.

5-26           (b)  The board shall meet at least monthly and at the call of

5-27     the presiding officer or of a majority of the members, as provided

 6-1     by board rule.

 6-2           SECTION 4.04.  COMPENSATION; EXPENSES.  A board member is not

 6-3     entitled to receive compensation but is entitled to reimbursement

 6-4     of the member's travel expenses as provided in the General

 6-5     Appropriations Act.

 6-6           SECTION 4.05.  APPLICATION OF OPEN RECORDS AND OPEN MEETINGS

 6-7     LAW.  (a)  The development agency is a governmental body subject to

 6-8     the open records law, Chapter 552, Government Code, except that the

 6-9     financial records of an applicant or borrower are not public

6-10     information.

6-11           (b)  The board is a governmental body subject to the open

6-12     meetings law, Chapter 551, Government Code, except that the board

6-13     is not required to conduct an open meeting to discuss the financial

6-14     matters of an applicant or borrower.

6-15           SECTION 4.06.  EXCLUSIVE AUTHORITY.  (a)  On full

6-16     implementation of this Act, the development agency has the

6-17     exclusive authority to act as the administrator of state agency

6-18     loan and loan guarantee programs transferred by this Act, including

6-19     approving and servicing loans.  Subject to Subsection (b) of this

6-20     section, the powers and duties relating to administering a program

6-21     of an entity required by other law to administer a loan or loan

6-22     guarantee program transferred by this Act are transferred to the

6-23     development agency, and the entity shall transfer all records

6-24     relating to the program to the development agency.

6-25           (b)  Each entity from which a program is transferred by this

6-26     Act to the development agency shall execute with the development

6-27     agency a memorandum of understanding governing the transfer.  The

 7-1     transfer shall be accomplished in accordance with the memorandum.

 7-2           (c)  The Texas Economic Development Agency shall serve as the

 7-3     administrator of all existing state agency loan and loan guarantee

 7-4     programs transferred by this Act and all future state agency loan

 7-5     and loan guarantee programs.

 7-6           SECTION 4.07.  CHIEF OPERATING OFFICER; EMPLOYEES.  (a)  The

 7-7     board shall employ a chief operating officer of the development

 7-8     agency.  The board may delegate to the officer any of the board's

 7-9     powers and duties.

7-10           (b)  The chief operating officer may employ persons necessary

7-11     for the proper management of the development agency.

7-12           SECTION 4.08.  LENDING AUTHORITY.  (a)  The board by rule

7-13     shall establish a breakdown of lending authority within the

7-14     development agency.

7-15           (b)  The chief operating officer shall establish the loan

7-16     authority of the development agency's employees within board rules.

7-17           SECTION 4.09.  SECONDARY MARKET PARTICIPATION.  The

7-18     development agency may enter into participations to develop a

7-19     securitization program to sell into secondary markets.

7-20           SECTION 4.10.  DEVELOPMENT AGENCY AUDIT.  The development

7-21     agency shall provide for an annual audit of the financial condition

7-22     of the agency by:

7-23                 (1)  the state auditor; or

7-24                 (2)  a private auditing firm.

7-25           SECTION 4.11.  PROGRAM MARKETING.  The development agency may

7-26     adopt a policy to market the programs administered by the agency.

7-27           SECTION 4.12.  MEMORANDUM OF UNDERSTANDING.  The development

 8-1     agency and the Texas Public Finance Authority shall jointly execute

 8-2     a memorandum of understanding relating to the agency retaining

 8-3     earnings that exceed the costs of bond retirement and costs of the

 8-4     Texas Public Finance Authority.

 8-5           SECTION 4.13.  SUBSIDIARY.  The development agency may form a

 8-6     subsidiary as determined necessary by the agency.

 8-7           SECTION 4.14.  CASH MANAGEMENT.  The board shall adopt a

 8-8     written cash management policy and review it annually.

 8-9           SECTION 4.15.  TECHNICAL SERVICES.  (a)  An entity from which

8-10     a program is transferred by this Act shall perform, on request of

8-11     the development agency, technical services related to programs and

8-12     projects transferred from the entity to the development agency by

8-13     this Act.

8-14           (b)  The development agency may contract with other entities

8-15     to perform the technical services.

8-16           SECTION 4.16.  GIFTS AND GRANTS.  The development agency may

8-17     accept gifts and grants from any private or public source.

8-18           SECTION 4.17.  EARNINGS.  The excess earnings from programs

8-19     administered by the development agency after payment of

8-20     administrative overhead and payment for debt retirement may be

8-21     pooled and used for any program administered by the agency or used

8-22     to create an economic emergency assistance fund.

8-23           SECTION 4.18.  ECONOMIC EMERGENCY ASSISTANCE FUND.  The board

8-24     may create an economic emergency assistance fund and adopt rules

8-25     regulating the fund and the use of money in the fund.  The board

8-26     may deposit any earnings from programs administered by the

8-27     development agency into the economic emergency assistance fund.

 9-1           SECTION 4.19.  CONTRACTS WITH PRIVATE ENTITIES.  The

 9-2     development agency may contract with a private entity to perform an

 9-3     activity related to a program transferred by this Act as long as

 9-4     the activity is not solely a sovereign function of the state.

 9-5           SECTION 4.20.  EFFECTIVE DATE.  This article takes effect

 9-6     January 15, 1998.

 9-7                 ARTICLE 5.  LEGISLATIVE OVERSIGHT COMMITTEE

 9-8           SECTION 5.01.  LEGISLATIVE OVERSIGHT COMMITTEE; SUNSET DATE.

 9-9     (a)  The Legislative Oversight Committee is composed of six members

9-10     as follows:

9-11                 (1)  three members must be members of the senate,

9-12     appointed by the lieutenant governor; and

9-13                 (2)  three members must be members of the house of

9-14     representatives, appointed by the speaker of the house of

9-15     representatives.

9-16           (b)  The lieutenant governor shall appoint the initial

9-17     presiding officer for a term ending January 31, 1999, and the

9-18     speaker of the house of representatives shall appoint the successor

9-19     presiding officer for a term beginning February 1, 1999.

9-20           (c)  The committee is subject to Chapter 325, Government Code

9-21     (Texas Sunset Act).  Unless continued in existence as provided by

9-22     that chapter, the committee is abolished and this article expires

9-23     August 31, 1999.

9-24           SECTION 5.02.  COMMITTEE POWERS AND DUTIES.  (a)  The

9-25     committee shall:

9-26                 (1)  meet quarterly with the board; and

9-27                 (2)  receive information regarding rules adopted by the

 10-1    board or proposed for adoption by the board.

 10-2          (b)  The committee may request reports and other information

 10-3    from the board relating to the operation of the board.

 10-4          (c)  The committee shall review the specific recommendations

 10-5    for legislation proposed by the board.

 10-6          SECTION 5.03.  REPORT.  (a)  The committee shall file a

 10-7    report with the governor, lieutenant governor, and speaker of the

 10-8    house of representatives not later than December 31 of each

 10-9    even-numbered year.

10-10          (b)  The report must include:

10-11                (1)  identification of any problems in the board's

10-12    administration of programs with recommended solutions for

10-13    commission and legislative action; and

10-14                (2)  other recommendations for legislative action.

10-15          SECTION 5.04.  EFFECTIVE DATE.  This article takes effect

10-16    January 15, 1998.

10-17                       ARTICLE 6.  COMPTROLLER STUDY

10-18          SECTION 6.01.  COMPTROLLER STUDY.  (a)  The comptroller shall

10-19    conduct a study to review the programs transferred to the

10-20    development agency by this Act.  Based on the study, the

10-21    comptroller shall develop and make recommendations to the governor,

10-22    lieutenant governor, and speaker of the house of representatives

10-23    concerning the integrated structure of the development agency.

10-24          (b)  Each state entity affected by the transfer of program

10-25    jurisdiction shall cooperate with the comptroller in formulating

10-26    and implementing a transition plan, including the development of

10-27    program transition plans and an interim operating budget and the

 11-1    temporary assignment of staff as necessary to ensure an orderly

 11-2    transition.

 11-3          (c)  The comptroller's report and recommendations for the

 11-4    structure of the development agency and the transition of the

 11-5    programs transferred shall be filed with the governor, lieutenant

 11-6    governor, and speaker of the house of representatives not later

 11-7    than January 15, 1998.

 11-8          (d)  After review of the comptroller's plan by the governor,

 11-9    lieutenant governor, and speaker of the house of representatives,

11-10    the development agency shall, to the extent practicable, implement

11-11    the program transition in a manner consistent with the

11-12    comptroller's plan.

11-13          (e)  Each state agency affected by the transfer of program

11-14    jurisdiction shall cooperate with the comptroller and the

11-15    development agency in formulating and implementing a transition

11-16    plan.

11-17          SECTION 6.02.  EFFECTIVE DATE; EXPIRATION.  This article

11-18    takes effect September 1, 1997, and expires August 31, 1999.

11-19            ARTICLE 7.  TRANSFER OF CERTAIN PROPERTY, RECORDS,

11-20          OBLIGATIONS, FUNDS, FUNCTIONS, PROGRAMS, AND ACTIVITIES

11-21                          TO DEVELOPMENT AGENCY 

11-22          SECTION 7.01.  TRANSFERS.  On May 1, 1998, or an earlier date

11-23    provided by an interagency agreement with the affected entity, the

11-24    following functions, programs, and activities are transferred to

11-25    the development agency:

11-26                (1)  from the Texas Department of Housing and Community

11-27    Affairs, the community and economic development grants program;

 12-1                (2)  from the General Land Office, the recycled

 12-2    products market expansion program;

 12-3                (3)  from the Parks and Wildlife Department, the public

 12-4    information program to communicate the state's natural and cultural

 12-5    resource conservation message through various media, including

 12-6    television, radio, newspapers, and magazines; and

 12-7                (4)  from the Texas Department of Transportation, the

 12-8    travel information program, other than the operation of the

 12-9    department's Travel Information Centers, to support and promote

12-10    tourism.

12-11          SECTION 7.02.  AMENDMENT.  Section 9B(a), Texas Public

12-12    Finance Authority Act (Article 601d, Vernon's Texas Civil

12-13    Statutes), is amended to read as follows:

12-14          (a)  With respect to all bonds authorized to be issued by the

12-15    Texas National Guard Armory Board, Texas National Research

12-16    Laboratory Commission, Parks and Wildlife Department, and all

12-17    institutions of higher education authorized to issue bonds under

12-18    Chapter 55, Education Code,  and with respect to all bonds

12-19    authorized to be issued by entities to fund programs administered

12-20    by the Texas Economic Development Agency, the authority has the

12-21    exclusive authority to act on behalf of those entities in issuing

12-22    bonds on their behalf.  In connection with those issuances and with

12-23    the issuance of refunding bonds on behalf of those entities, the

12-24    authority is subject to all rights, duties, and conditions

12-25    surrounding issuance previously applicable to the issuing entity

12-26    under the statute authorizing the issuance.  All references in an

12-27    authorizing statute to the entity on whose behalf the bonds are

 13-1    being issued apply equally to the authority in its capacity as

 13-2    issuer on behalf of the entity.

 13-3          SECTION 7.03.  EFFECTIVE DATE.  This article takes effect

 13-4    January 15, 1998.

 13-5            ARTICLE 8.  TRANSFER OF CERTAIN PROPERTY, RECORDS,

 13-6          OBLIGATIONS, FUNDS, FUNCTIONS, PROGRAMS, AND ACTIVITIES

 13-7                          TO DEVELOPMENT AGENCY 

 13-8          SECTION 8.01.  TRANSFERS.  On May 1, 1998, the following

 13-9    functions, programs, and activities are transferred to the

13-10    development agency from the Texas Agricultural Finance Authority:

13-11                (1)  TAFA loan guarantee program;

13-12                (2)  linked deposit program;

13-13                (3)  microenterprise support program;

13-14                (4)  young farmers endowment program; and

13-15                (5)  farm and ranch finance program.

13-16              ARTICLE 9.  TEXAS DEPARTMENT OF BANKING REPORT

13-17          SECTION 9.01.  UNDERWRITING STANDARDS.  (a)  The Texas

13-18    Department of Banking shall examine loans in programs administered

13-19    by the development agency to determine the credit quality and value

13-20    of the loans.

13-21          (b)  The Texas Department of Banking shall recommend

13-22    appropriate loan underwriting standards consistent with the

13-23    development agency's mission and programs.

13-24          (c)  The Texas Department of Banking shall file a report of

13-25    the department's recommendations with the governor, lieutenant

13-26    governor, and speaker of the house of representatives not later

13-27    than August 1, 1998.

 14-1          SECTION 9.02.  EFFECTIVE DATE; EXPIRATION.  This article

 14-2    takes effect January 1, 1998, and expires January 1, 1999.

 14-3                      ARTICLE 10.  AUDITOR EVALUATION

 14-4          SECTION 10.01.  AUDITOR EVALUATION.  (a)  The state auditor

 14-5    shall evaluate the management and fiscal control systems of the

 14-6    development agency and make any recommendation for improvement to

 14-7    the governor, the legislature, and the development agency.

 14-8          (b)  The state auditor shall report the results of the

 14-9    evaluation conducted under Subsection (a) of this section to the

14-10    governor and the legislature not later than December 1, 1998.

14-11          SECTION 10.02.  EFFECTIVE DATE.  This article takes effect

14-12    January 15, 1998.

14-13                    ARTICLE 11.  TRANSFER OF PERSONNEL

14-14          SECTION 11.01.  TRANSFER OF PERSONNEL.  A person employed by

14-15    a program transferred to the development agency by this Act becomes

14-16    an employee of the development agency on the date on which the

14-17    transfer of the program to the development agency is completed.

14-18          ARTICLE 12.  AMENDMENT AND REPEAL OF CERTAIN FUNCTIONS,

14-19          POWERS, AND DUTIES OF THE TEXAS DEPARTMENT OF COMMERCE

14-20          SECTION 12.01.  EFFECT OF CERTAIN AMENDMENTS.  The amendment

14-21    by this article of a statute referring to the Texas Department of

14-22    Commerce or a division of the department does not affect the

14-23    abolition of that department by this Act.

14-24          SECTION 12.02.  Section 481.082, Government Code, is amended

14-25    to read as follows:

14-26          Sec. 481.082.  PURPOSE.  (a)  The legislature finds that:

14-27                (1)  the health, safety, right to gainful employment,

 15-1    and general welfare of the people of this state require as a public

 15-2    purpose the promotion and development of new and expanded

 15-3    enterprises; and

 15-4                (2)  communities in this state are at a critical

 15-5    disadvantage in competing with communities in this state and other

 15-6    states for the location or expansion of enterprises because of

 15-7    available financial resources [the availability in all other states

 15-8    of financing] and [other special] incentives.

 15-9          (b)  The purpose of this subchapter is to promote economic

15-10    development and employment in rural areas, which is a public

15-11    purpose.

15-12          (c)  In administering this subchapter, the office of rural

15-13    affairs [department] shall ensure that assistance is  provided to

15-14    improve economic development conditions and opportunity for

15-15    citizens in rural areas of this state [give first preference to

15-16    assistance to the food and fiber processing industries].

15-17          SECTION 12.03.  Section 481.083(7), Government Code, is

15-18    amended to read as follows:

15-19                (7)  "Rural area" means an area that is predominantly

15-20    rural in character and meets the conditions of a rural area, as

15-21    defined [designated] by the department [as a rural area].

15-22          SECTION 12.04.  Section 481.0831, Government Code, is amended

15-23    by amending Subsection (b) and adding Subsection (c) to read as

15-24    follows:

15-25          (b)  The office shall be headed by a rural affairs director[:]

15-26                [(1)  implement the programs established under this

15-27    subchapter; and]

 16-1                [(2)  address the special needs of rural communities

 16-2    and businesses and assist those communities and businesses].

 16-3          (c)  To be eligible to serve as the rural affairs director, a

 16-4    person must have demonstrated a strong commitment to and

 16-5    involvement in economic development activities in rural areas.

 16-6          SECTION 12.05.  Section 481.088, Government Code, is amended

 16-7    to read as follows:

 16-8          Sec. 481.088.  GENERAL DUTIES OF OFFICE OF RURAL AFFAIRS

 16-9    [DIRECTIVE].  [(a)]  The office of rural affairs [executive

16-10    director] shall:

16-11                (1)  serve as a principal point of contact for comments

16-12    and suggestions concerning state government policies and activities

16-13    that affect rural areas;

16-14                (2)  provide advice to the governor and the legislature

16-15    regarding administrative requirements and legislation that affect

16-16    rural areas;

16-17                (3)  develop proposals for changes in the policies and

16-18    activities of state agencies that will better serve the purposes of

16-19    this subchapter and communicate those proposals to the appropriate

16-20    agencies;

16-21                (4)  cooperate with other public and private entities

16-22    that provide assistance to rural areas; and

16-23                (5)  cooperate and provide assistance to public  and

16-24    private agencies, businesses, and other organizations by:

16-25                      (A)  disseminating information about the programs

16-26    and services provided by the state that benefit rural areas; and

16-27                      (B)  informing the agencies, businesses, and

 17-1    organizations of how to participate in or make use of the programs

 17-2    and services that benefit rural areas.  [conduct a detailed,

 17-3    comprehensive analysis of the availability of federal, state, and

 17-4    local government and private sector rural economic development

 17-5    business outreach and data services in Texas.  The analysis must

 17-6    specifically examine the availability of:]

 17-7                [(1)  integrated computerized rural economic

 17-8    development data banks that provide comprehensive economic data for

 17-9    existing and prospective businesses in Texas; and]

17-10                [(2)  business information outreach service offices or

17-11    centers that provide comprehensive technical assistance, research,

17-12    consulting services, training, and other business services to small

17-13    rural communities to help businesses prepare and implement economic

17-14    development business plans and assist new business start-up

17-15    projects in Texas.]

17-16          [(b)  In conducting the analysis required by this section,

17-17    the executive director shall consult with the governor, economic

17-18    development officials, economic development experts in the private

17-19    sector, and the academic community in Texas.]

17-20          [(c)  The cost of the analysis and establishment of the rural

17-21    economic development data base required by this section may be paid

17-22    from available funds in the fund in an amount not to exceed

17-23    $300,000.]

17-24          SECTION 12.06.  Section 481.089, Government Code, is amended

17-25    to read as follows:

17-26          Sec. 481.089.  SPECIFIC DUTIES OF OFFICE OF RURAL AFFAIRS

17-27    [CRITERIA].  To carry out the duties under Section  481.088, the

 18-1    office of rural affairs shall:

 18-2                (1)  develop a rural resource guide and provide the

 18-3    information to rural areas through print and electronic media;

 18-4                (2)  provide information to state agencies on the

 18-5    effects of proposed policies or actions that affect rural areas;

 18-6                (3)  cosponsor meetings, to the extent practical, in

 18-7    cooperation with public and private educational institutions to

 18-8    disseminate information beneficial to rural areas;

 18-9                (4)  identify potential opportunities for businesses in

18-10    rural areas and assist these businesses to maximize those

18-11    opportunities;

18-12                (5)  conduct an analysis of the available federal,

18-13    state, and local government and rural economic development business

18-14    outreach and data services in rural areas of this state by

18-15    examining the availability of:

18-16                      (A)  computerized economic development databases

18-17    that provide data for existing and prospective businesses and

18-18    communities in rural areas of this state; and

18-19                      (B)  business information outreach service

18-20    offices or centers that provide comprehensive technical assistance,

18-21    research, consulting services, training, and other services to

18-22    businesses in rural areas; and

18-23                (6)  perform any other functions necessary to carry out

18-24    the purposes of this subchapter.  [(a)  In assessing the

18-25    availability of rural economic development data services in Texas,

18-26    the executive director shall determine the capability of the data

18-27    banks to provide a socioeconomic profile of each trade area,

 19-1    region, or sector that includes an inventory of the area's resource

 19-2    base, the area's barriers to economic development, and an

 19-3    assessment of the area's competitive position in the industrial

 19-4    marketplace particularly in the area of production sharing.]

 19-5          [(b)  The executive director shall determine the ability of a

 19-6    data bank to compile:]

 19-7                [(1)  population data for each community and county in

 19-8    Texas;]

 19-9                [(2)  data on all retail businesses by locality,

19-10    county, and community, including information on sales, types of

19-11    products and services, employees, organizational forms, and

19-12    affiliations;]

19-13                [(3)  information on all components of the health care

19-14    delivery system by community and county, including information on

19-15    physicians, hospitals, laboratories, specialized health care

19-16    providers, and institutions;]

19-17                [(4)  information on all aspects of the transportation

19-18    system in Texas, including data on streets and highways, airline

19-19    and other  air access and airports, freight lines, railroad access,

19-20    and limitations imposed through regulation, restrictions on

19-21    transportation of hazardous materials, bridges, landing facilities,

19-22    and the current condition of existing transportation facilities;]

19-23                [(5)  a current inventory of all available industrial

19-24    facilities for lease or sale, including information regarding age,

19-25    type of construction, zoning, availability, cost, ability to

19-26    renovate, utilities, incentives, and similar data;]

19-27                [(6)  information on all public and private utilities

 20-1    available by community, area, and county, including information on

 20-2    extension of public utilities into rural and nonmetropolitan areas,

 20-3    and the ability of systems to support economic growth;]

 20-4                [(7)  information on police, fire, hazardous material

 20-5    safety, and rescue services, including information on crime rates;]

 20-6                [(8)  information on all community, county, regional,

 20-7    and state agencies and organizations, and information on what these

 20-8    agencies and organizations can provide to existing and prospective

 20-9    businesses in Texas;]

20-10                [(9)  information on all primary and secondary

20-11    education programs and programs offered by institutions of higher

20-12    education by community, rural area, and county, including

20-13    information on vocational educational resources and general

20-14    demographic information on the student population;]

20-15                [(10)  information on manufacturing facilities,

20-16    including information by community, county, and type of

20-17    manufacturer;]

20-18                [(11)  information on financial institutions, including

20-19    size, amounts of deposits, loan policies, names of officers, and

20-20    other pertinent  information to assist existing and prospective

20-21    economic development in rural areas of Texas;]

20-22                [(12)  information weighing the relative strengths and

20-23    weaknesses of communities, counties, and other locations within

20-24    Texas regarding rural economic development opportunities;]

20-25                [(13)  information regarding technology transfer

20-26    between federal, state, and local governments and private industry

20-27    in Texas;]

 21-1                [(14)  information regarding the flow of trade across

 21-2    the border of the United States of America and the United Mexican

 21-3    States and business opportunities for maquiladora operations and

 21-4    other production sharing enterprises in Texas derived from the

 21-5    border trade; and]

 21-6                [(15)  information on the development of special

 21-7    economic models for regional economic forecasts for Texas.]

 21-8          SECTION 12.07.  Section 481.090, Government Code, is amended

 21-9    to read as follows:

21-10          Sec. 481.090.  STAFF AND POWERS OF OFFICE OF RURAL AFFAIRS

21-11    [BUSINESS SERVICE OUTREACH STUDY].  In administering  this

21-12    subchapter, the department may:

21-13                (1)  employ and set the compensation of personnel to

21-14    carry out the office of rural affairs' functions under this

21-15    subchapter; and

21-16                (2)  consult with:

21-17                      (A)  experts and authorities in the fields of

21-18    rural development, economic development, and community development;

21-19                      (B)  individuals with regulatory, legal,

21-20    economic, or financial expertise, including members of the academic

21-21    community; and

21-22                      (C)  individuals who represent the public

21-23    interest [assessing the availability of business information

21-24    outreach service  offices in Texas, the executive director shall

21-25    determine the capability of federal, state, and local government

21-26    and private sector programs in Texas, including programs that:]

21-27                [(1)  provide a comprehensive array of data gathering,

 22-1    consulting, and training business services to existing and

 22-2    prospective businesses and industries with interest in locating

 22-3    operations in Texas;]

 22-4                [(2)  serve as a liaison among existing small business

 22-5    development centers, state agencies, vocational educational

 22-6    agencies, other community economic development organizations, and

 22-7    both existing and prospective new business interests;]

 22-8                [(3)  conduct studies, including target industry

 22-9    studies, for determining the benefits and costs to be incurred by

22-10    locating a business or industry in Texas;]              

22-11                [(4)  develop special economic models for regional

22-12    economic forecasts for Texas;]

22-13                [(5)  analyze, develop, and disseminate to the business

22-14    community new technologies in community infrastructure development,

22-15    including water conservation and purification systems, recycling

22-16    and waste treatment systems, solar and geothermal energy sources,

22-17    disposal technologies for industrial and medical hazardous

22-18    ][materials and waste, and landfill operations;]

22-19                [(6)  share with the business community information on

22-20    new product and material developments available from institutions

22-21    of higher education and government research laboratories and

22-22    agencies of the federal government;]

22-23                [(7)  facilitate industry and community production

22-24    networks that include cottage industries in manufacturing,

22-25    industrial machining, and injection molding and that include

22-26    community industrial manufacturing cooperatives involving multiple

22-27    businesses and communities; and]

 23-1                [(8)  interface with the rural economic development

 23-2    data banks, the electronic data base of the department, and any

 23-3    other appropriate data bases and make the data available to

 23-4    existing and prospective businesses in Texas].

 23-5          SECTION 12.08.  Section 481.092, Government Code, is amended

 23-6    to read as follows:

 23-7          Sec. 481.092.  ASSISTANCE OF GOVERNMENT AGENCIES [REVIEW].

 23-8    Each state agency must, on request, furnish the office  of rural

 23-9    affairs with reports and other information necessary to carry out

23-10    the functions of this subchapter. [The comptroller shall review the

23-11    implementation of Sections 481.088-481.090 of this chapter and

23-12    assist in carrying out the assessment of programs and activities

23-13    authorized in those sections.  The comptroller shall make periodic

23-14    written reports to the appropriate committees of the legislature

23-15    regarding the studies and analyses to be prepared by the executive

23-16    director.]

23-17          SECTION 12.09.  Section 481.093, Government Code, is amended

23-18    to read as follows:

23-19          Sec. 481.093.  FUNDING [GIFTS AND GRANTS].   The office of

23-20    rural affairs [department] may accept gifts,  grants, and donations

23-21    from  any source for the purposes of performing specific projects,

23-22    studies, or procedures or to provide assistance to small

23-23    businesses [this subchapter].

23-24          SECTION 12.10.  Subchapter F, Chapter 481, Government Code,

23-25    is amended by adding Section 481.094 to read as follows:

23-26          Sec. 481.094.  REPORTS.  Not later than September 1 of each

23-27    even-numbered year, the department shall send to the governor and

 24-1    the legislature a report containing specific information regarding

 24-2    each of the functions performed by the office of rural affairs

 24-3    under this subchapter, including suggestions regarding issues

 24-4    critical to the rural areas of this state.

 24-5          SECTION 12.11.  The executive director of the Texas

 24-6    Department of Commerce shall employ a rural affairs director as

 24-7    required by Section 481.0831, Government Code, as amended by this

 24-8    article, not later than January 1, 1998.

 24-9          SECTION 12.12.  AMENDMENT.  Section 481.102, Government Code,

24-10    is amended to read as follows:

24-11          Sec. 481.102.  OFFICE OF SMALL BUSINESS ASSISTANCE.  The

24-12    Office of Small Business Assistance is an office within the

24-13    department headed by a small business director.  The office may

24-14    accept gifts, grants, and donations from sources other than the

24-15    state for the purpose of performing specific projects, studies, or

24-16    procedures or to provide assistance to small businesses.

24-17          SECTION 12.13.  AMENDMENT.  Section 481.103(a), Government

24-18    Code, is amended to read as follows:

24-19          (a)  The office shall:

24-20                (1)  examine the role of small and historically

24-21    underutilized businesses in the state's economy and the

24-22    contribution of small and historically underutilized businesses in

24-23    generating economic activity, expanding employment opportunities,

24-24    promoting exports, stimulating innovation and entrepreneurship, and

24-25    bringing new and untested products and services to the marketplace;

24-26                (2)  serve as the principal focal point [advocate] in

24-27    the state for [on behalf of] small and historically underutilized

 25-1    businesses by:

 25-2                      (A)  providing to the legislature information on

 25-3    the effects of proposed policies or actions;

 25-4                      (B)  assisting state agencies in determining the

 25-5    impact proposed rules have on small businesses as required by

 25-6    Section 2006.002; and

 25-7                      (C)  assisting the agencies in reducing the

 25-8    adverse effect that rules have on small businesses, if appropriate

 25-9    [and provide advice in the consideration of administrative

25-10    requirements and legislation that affect small and historically

25-11    underutilized businesses];

25-12                (3)  evaluate the effectiveness of efforts of state

25-13    agencies and other entities to assist small and historically

25-14    underutilized businesses and make appropriate recommendations to

25-15    the legislature and state agencies to assist the development and

25-16    strengthening  of small and historically underutilized businesses;

25-17                (4)  identify [specific instances in which] regulations

25-18    that inhibit small and historically underutilized business

25-19    development and to the extent possible identify conflicting state

25-20    policy goals;

25-21                (5)  determine the availability of financial and other

25-22    resources to small and historically underutilized businesses and

25-23    recommend methods for:

25-24                      (A)  increasing the availability of equity

25-25    capital and other forms of financial assistance to small and

25-26    historically underutilized businesses;

25-27                      (B)  generating markets for the goods and

 26-1    services of small and historically underutilized businesses;

 26-2                      (C)  providing more effective education,

 26-3    training, and management and technical assistance to small and

 26-4    historically underutilized businesses; and

 26-5                      (D)  providing assistance to small and

 26-6    historically underutilized businesses in complying with federal,

 26-7    state, and local laws;

 26-8                (6)  identify [describe] the reasons for small and

 26-9    historically underutilized business successes and failures,

26-10    ascertain the related factors that are particularly important in

26-11    this state, and recommend actions for increasing the success rate

26-12    of small and historically underutilized businesses;

26-13                (7)  serve as a focal point for receiving comments

26-14    [complaints] and suggestions concerning state government policies

26-15    and activities that affect small and historically underutilized

26-16    businesses;

26-17                (8)  [assist with the resolution of problems among

26-18    state agencies and small and historically underutilized businesses;]

26-19                [(9)]  develop and suggest [advocate] proposals for

26-20    changes in state policies and activities that adversely affect

26-21    small and historically underutilized businesses;

26-22                (9) [(10)]  provide to [legislative committees and]

26-23    state agencies information on the effects of proposed policies or

26-24    actions that affect small and historically underutilized

26-25    businesses;

26-26                (10) [(11)]  enlist the assistance of public and

26-27    private agencies, businesses, and other organizations in

 27-1    disseminating information about state programs and services that

 27-2    benefit small and historically underutilized businesses and

 27-3    information regarding means by which small and historically

 27-4    underutilized businesses can use those programs and services;

 27-5                (11) [(12)]  provide information and assistance

 27-6    relating to establishing, operating, or expanding small and

 27-7    historically underutilized businesses;

 27-8                (12) [(13)]  establish and operate a statewide

 27-9    toll-free telephone service providing small and historically

27-10    underutilized businesses with ready access to the services offered

27-11    by the office;

27-12                (13) [(14)]  assist small and historically

27-13    underutilized businesses by:

27-14                      (A)  identifying:

27-15                            (i)  sources of financial assistance for

27-16    those businesses; and

27-17                            (ii)  financial barriers to those

27-18    businesses;

27-19                      (B)  working with relevant organizations to

27-20    identify [establishing] financing programs [for those businesses]

27-21    that aid small businesses in overcoming financial barriers;

27-22                      (C)  matching those businesses with sources of

27-23    financial assistance and credit enhancement; and

27-24                      (D)  assisting those businesses with the

27-25    preparation of applications for government loans, loan guarantees,

27-26    and credit enhancement programs [from governmental or private

27-27    sources];

 28-1                (14) [(15)]  sponsor meetings, to the extent

 28-2    practicable in cooperation with public and private educational

 28-3    institutions, to provide training and disseminate information

 28-4    beneficial to small and historically underutilized businesses;

 28-5                (15) [(16)]  assist small and historically

 28-6    underutilized businesses in their dealings with federal, state, and

 28-7    local governmental agencies and provide information regarding

 28-8    governmental requirements affecting small and historically

 28-9    underutilized businesses;

28-10                (16) [(17)]  perform research, studies, and analyses of

28-11    matters affecting the interests of small and historically

28-12    underutilized businesses;

28-13                (17) [(18)  develop and implement programs to encourage

28-14    governmental agencies, public sector business associations, and

28-15    other organizations to provide useful services to small and

28-16    historically underutilized businesses;]

28-17                [(19)]  use available resources within the state, such

28-18    as small business development centers, educational institutions,

28-19    and nonprofit associations, to coordinate the provision of

28-20    management and technical assistance to small and historically

28-21    underutilized businesses in a systematic manner;

28-22                (18) [(20)]  publish newsletters, brochures, and other

28-23    documents containing information useful to small and historically

28-24    underutilized businesses;

28-25                (19) [(21)]  identify successful small and historically

28-26    underutilized business assistance programs provided by other states

28-27    and determine the feasibility of adapting those programs for

 29-1    implementation in this state;

 29-2                (20) [(22)]  establish an outreach program to make the

 29-3    existence of the office known to small and historically

 29-4    underutilized businesses and potential clients throughout the

 29-5    state;

 29-6                (21) [(23)]  adopt rules necessary to carry out this

 29-7    subchapter;

 29-8                (22) [(24)]  identify potential business opportunities

 29-9    for small and historically underutilized businesses in areas of

29-10    this state that are economically distressed, including areas of

29-11    high unemployment and areas with high levels of poverty, [the

29-12    border region] and develop programs to maximize those

29-13    opportunities;

29-14                (23) [(25)]  identify potential business opportunities

29-15    for small and historically underutilized businesses in rural areas

29-16    of this state and develop programs to maximize those opportunities;

29-17    [and]

29-18                (24)  enlist the cooperation and assistance of public

29-19    and private agencies, businesses, and other organizations in

29-20    disseminating information about the programs and services provided

29-21    by the state that benefit small businesses and how small businesses

29-22    can participate in or make use of those programs and services;

29-23                (25)  defer to the small business stationary source

29-24    assistance program as defined by Section 382.0365, Health and

29-25    Safety Code, on advocacy and technical assistance related to

29-26    environmental programs that regulate small businesses; and

29-27                (26)  perform any other functions necessary to carry

 30-1    out the purposes of this subchapter.

 30-2          SECTION 12.14.  AMENDMENT.  Subchapter G, Chapter 481,

 30-3    Government Code, is amended by adding Section 481.109 to read as

 30-4    follows:

 30-5          Sec. 481.109.  ASSISTANCE TO GOVERNMENTAL AGENCIES.  Each

 30-6    department, agency, and instrumentality of state government is

 30-7    authorized and directed to furnish the office with reports and

 30-8    other information as necessary to carry out the functions of this

 30-9    subchapter.

30-10          SECTION 12.15.  AMENDMENT.  Section 2006.002, Government

30-11    Code, is amended by adding Subsection (f) to read as follows:

30-12          (f)  To reduce the adverse impact of rules on

30-13    micro-businesses, a state agency may adopt provisions concerning

30-14    micro-businesses similar to those outlined in Subsection (b) for

30-15    small businesses.

30-16          SECTION 12.16.  AMENDMENT.  Section 481.155, Government Code,

30-17    is amended to read as follows:

30-18          Sec. 481.155.  GRANTS.  (a)  The executive director may award

30-19    grants for projects that meet the requirements of this chapter.  It

30-20    is the intent of the legislature that, to the greatest extent

30-21    practicable, money from the smart jobs fund shall be spent in all

30-22    areas of the state.  The executive director may award a grant or a

30-23    combination of grants in any fiscal year to a single employer in

30-24    excess of $1 million or at a rate greater than 10 percent of the

30-25    annual wages of the new or existing job being created or retained

30-26    with the grant only if:

30-27                (1)  the employer locates or expands in an enterprise

 31-1    zone;

 31-2                (2)  the employer locates or expands in an adversely

 31-3    affected defense-dependent community;

 31-4                (3)  the employer locates or expands in an area having

 31-5    an unemployment rate 1-1/2 times or greater than the statewide

 31-6    average at the time of the application;

 31-7                (4)  the employer locates or expands in a county with a

 31-8    population of less than 75,000;

 31-9                (5)  at least 25 percent of the employees hired or

31-10    retained by the employer are economically disadvantaged individuals

31-11    as defined by Section 2303.402(c); or

31-12                (6)  the employer is a small business or a

31-13    micro-business.

31-14          (b)  The executive director shall attempt to ensure that at

31-15    least 20 percent of the total dollar amount of grants awarded under

31-16    the program are awarded to minority employers.

31-17          (c) [(b)]  The program is job-driven.  A grant may not be

31-18    awarded unless each employer participating in the project certifies

31-19    that:

31-20                (1)  a job or job opening exists or will exist at the

31-21    end of the project for which the grant is sought; and

31-22                (2)  the job or job opening will be filled by a

31-23    participant in the project.

31-24          (d) [(c)]  A grant may not be awarded for a project under

31-25    this section unless each employer participating in the project

31-26    certifies that the starting wage for a new job created through the

31-27    project will be equal to or greater than the prevailing wage for

 32-1    that occupation in the local labor market area [greater than 66 2/3

 32-2    percent of the state average weekly wage] and that the wage for a

 32-3    job existing on the date that the project is scheduled to begin

 32-4    will be increased to the greater of:

 32-5                (1)  three [10] percent for a small business or five

 32-6    percent for a business that is not a small business over the wage

 32-7    in effect on the day before the date on which the project is

 32-8    scheduled to begin for that job; or

 32-9                (2)  100 percent of the prevailing wage for that

32-10    occupation in the local labor market area [75 percent of the state

32-11    average weekly wage].

32-12          (e) [(d)]  An employer may apply for a grant under this

32-13    chapter, and an employer who is a micro-business may request a

32-14    modification of the requirements provided by Subsection (d) and

32-15    Section 481.159(c), if:

32-16                (1)  the employer is required to reduce or eliminate

32-17    the employer's work force because of reductions in overall

32-18    employment within an industry;

32-19                (2)  [or] a substantial change in the skills required

32-20    to continue the employer's business exists because of technological

32-21    changes; or

32-22                (3)  other reasonable factors, as determined by[.  In

32-23    awarding a grant under this subsection,] the executive director,

32-24    exist [may modify the requirements of Subsection (c)].

32-25          (f)  Grants awarded under this section [subsection] for which

32-26    the executive director has modified the requirements of Subsection

32-27    (d) [(c)] may not, in any fiscal year, exceed 10 percent of the

 33-1    total dollar amount of grants awarded under the program in that

 33-2    year.

 33-3          (g) [(e)]  Unless modified by the executive director under

 33-4    rules adopted by the policy board, a grant may not be awarded for a

 33-5    project unless each employer participating in the project certifies

 33-6    that it will continue to spend on nonmanagerial training an amount

 33-7    from private sources equal to the average amount spent by that

 33-8    employer on such training for the most recent two-year period.

 33-9          (h) [(f)]  A grant may not be awarded for a project if the

33-10    project will impair existing contracts for services or collective

33-11    bargaining agreements, except that a project inconsistent with the

33-12    terms of a collective bargaining agreement may be undertaken with

33-13    the written concurrence of the collective bargaining unit and the

33-14    employer or employers who are parties to the agreement.

33-15          (i) [(g)]  During each state fiscal year the executive

33-16    director shall attempt to ensure that at least 50 percent of the

33-17    total dollar amount of grants awarded under this section is awarded

33-18    to small businesses, as defined by Section 481.101.

33-19          (j) [(h)]  In awarding a grant under this section, the

33-20    executive director shall give priority to a project that is located

33-21    in an enterprise zone as defined by Section 2303.003.

33-22          SECTION 12.17.  AMENDMENT.  Section 481.172, Government Code,

33-23    is amended to read as follows:

33-24          Sec. 481.172.  DUTIES.  The department shall:

33-25                (1)  promote and advertise within the United States and

33-26    in foreign countries, by radio, television, newspaper, and other

33-27    means considered appropriate, tourism in this state by non-Texans,

 34-1    including persons from foreign countries, and distribute

 34-2    promotional materials through appropriate distribution channels

 34-3    [agencies, including the United States Travel and Tourism Agency];

 34-4                (2)  encourage travel by Texans to this state's scenic,

 34-5    historical, natural, agricultural, educational, recreational, and

 34-6    other attractions;

 34-7                (3)  coordinate and stimulate orderly and accelerated

 34-8    development of tourist attractions throughout this state;

 34-9                (4)  conduct a public relations campaign to create a

34-10    responsible and accurate national and international image of this

34-11    state;

34-12                (5)  cooperate fully with the Parks and Wildlife

34-13    Department in all matters relating to promotion of tourism;

34-14                (6)  cooperate with the Texas Department of

34-15    Transportation [Commission] in the administration of the Texas

34-16    Department of Transportation's [commission's] collateral program of

34-17    highway map distribution and operation of travel information

34-18    bureaus and other tourist-related functions of the Texas Department

34-19    of Transportation [commission]; and

34-20                (7)  encourage communities, organizations, and

34-21    individuals [in this state] to cooperate with its program by their

34-22    activities and use of their own funds and collaborate with those

34-23    organizations and other governmental entities in  the pursuit of

34-24    the objectives of this subchapter.

34-25          SECTION 12.18.  AMENDMENT.  Section 481.221, Government Code,

34-26    is amended to read as follows:

34-27          Sec. 481.221.  DEFINITIONS.  In this subchapter:

 35-1                (1) [(2)]  "Executive director" means the executive

 35-2    director of the department or the executive director's designee.

 35-3                (2) [(3)]  "Fund" means the product development fund.

 35-4                [(4)  "Office" means the Office of Advanced Technology

 35-5    within the Texas Department of Commerce.]

 35-6                (3) [(5)]  "Product" means an invention, product,

 35-7    device, technique, or process, without regard to whether a patent

 35-8    has or could be granted,  that is or may be exploitable

 35-9    commercially.  The term does not refer to pure research but

35-10    includes products, devices, techniques, or processes that have

35-11    advanced beyond the theoretical stage and have or are readily

35-12    capable of having a commercial application.

35-13                (4) [(6)]  "Venture financing" means a revolving loan,

35-14    loan guarantee, or equity investment from the Texas product

35-15    development fund to a  person for use in the development of new or

35-16    improved products.

35-17          SECTION 12.19.  REPEALER.  Chapter 146, Education Code, is

35-18    repealed.

35-19          SECTION 12.20.  REPEALER.  Section 481.061, Government Code,

35-20    is repealed.

35-21          SECTION 12.21.  REPEALER.  Subchapters R, T, U, and V,

35-22    Chapter 481, Government Code, are repealed.

35-23          SECTION 12.22.  REPEALER.  Chapter 483, Government Code, is

35-24    repealed.

35-25                 ARTICLE 13.  BOARD APPOINTMENT; EMERGENCY

35-26          SECTION 13.01.  APPOINTMENT OF INITIAL TEXAS ECONOMIC

35-27    DEVELOPMENT AGENCY BOARD MEMBERS.  The governor shall appoint the

 36-1    initial members of the board of the development agency in a timely

 36-2    manner so that a quorum of the board has qualified for office not

 36-3    later than January 15, 1998.  The term of office of each of the

 36-4    initial board members expires February 1, 1999.

 36-5          SECTION 13.02.  EMERGENCY.  The importance of this

 36-6    legislation and the crowded condition of the calendars in both

 36-7    houses create an emergency and an imperative public necessity that

 36-8    the constitutional rule requiring bills to be read on three several

 36-9    days in each house be suspended, and this rule is hereby suspended.