HBA-ATS, MPA H.B. 1543 76(R)BILL ANALYSIS


Office of House Bill AnalysisH.B. 1543
By: Keffer
Economic Development
10/5/1999
Enrolled


BACKGROUND AND PURPOSE 

Under Texas law, a 4A development corporation may only be established in a
city with a population under 50,000 or a county with a population of
500,000 or less.  A 4B development corporation may only be established in a
city with a population over 400,000 or a county with a population of
750,000 or more.  Both entities were created by the Development Corporation
Act of 1979 (Article 5190.6, V.T.C.S.).  The population restrictions set
out in the Act have been changed by the legislature over time.  Some
corporations classified as 4A and 4B corporations would not qualify as a 4A
and 4B under the current guidelines. 

Prior to the 76th Legislature, an individual had to be a "city resident" to
qualify to serve as a director of a 4B development corporation.  In
contrast, to qualify to serve as a director of a 4A development
corporation, an individual was, and is, not required to reside in the city.
The requirement to reside in the city was burdensome for small rural
communities in which many of the business owners and those with a stake in
the community did not actually reside within the city limits.  These
persons were disqualified from serving on a 4B development corporation
board, limiting the availability of qualified candidates.  H.B. 1543
changes the requirements so that a person may serve on the board of
directors of a development corporation created under Section 4B if that
person lives either in the city that created the corporation or in the
county where the majority of the city is located, so long as the eligible
city has a population less than 20,000.  Each director of an industrial
development corporation created by an eligible city with a population of
20,000 or more must be a resident of the city.  

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 4B(c), Article 5190.6, V.T.C.S. (Development
Corporation Act of 1979), to provide that each director of an industrial
development corporation organized under this section created by an eligible
city with a population of 20,000 or more must be a resident of the city.
Provides that each director of an industrial development corporation
organized under this section created by an eligible city with a population
of less than 20,000 must be a resident of the city or the county in which
the major part of the eligible city is located. 

SECTION 2.  Effective date: September 1, 1999.

SECTION 3.  Emergency clause.