By Junell, Cuellar, Turner of Coleman, Cook,          H.B. No. 1676
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to permanent funds for certain public health purposes.
 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-4           SECTION 1.  Subchapter G, Chapter 403, Government Code, is
 1-5     amended by adding Sections 403.105, 403.1055, 403.106, 403.1065,
 1-6     403.1067, and 403.108 to read as follows:
 1-7           Sec. 403.105.  PERMANENT FUND FOR TOBACCO EDUCATION AND
 1-8     ENFORCEMENT.  (a)  The permanent fund for tobacco education and
 1-9     enforcement is a special fund in the state treasury outside the
1-10     general revenue fund.  The fund is composed of:
1-11                 (1)  money transferred to the fund at the direction of
1-12     the legislature;
1-13                 (2)  gifts and grants contributed to the fund; and
1-14                 (3)  the interest received from investment of money in
1-15     the fund.
1-16           (b)  Except as provided by Subsections (c), (e), and (f),
1-17     money in the fund may not be appropriated for any purpose.
1-18           (c)  The interest received from investment of the fund may be
1-19     appropriated to the Texas Department of Health for programs to
1-20     reduce the use of cigarettes and tobacco products in this state,
1-21     including:
1-22                 (1)  smoking cessation programs;
1-23                 (2)  enforcement of Subchapters H, K, and N, Chapter
1-24     161, Health and Safety Code, or other laws relating to distribution
1-25     of cigarettes or tobacco products to minors or use of cigarettes or
 2-1     tobacco products by minors;
 2-2                 (3)  public awareness programs relating to use of
 2-3     cigarettes and tobacco products, including general educational
 2-4     programs and programs directed toward youth; and
 2-5                 (4)  specific programs for communities traditionally
 2-6     targeted, by advertising and other means, by companies that sell
 2-7     cigarettes or tobacco products.
 2-8           (d)  Subject to any applicable limit in the General
 2-9     Appropriations Act, the Texas Department of Health may contract
2-10     with another entity to perform all or a part of the functions
2-11     described by Subsection (c) or may award grants to community
2-12     organizations, public institutions of higher education, as that
2-13     term is defined by Section 61.003, Education Code, or political
2-14     subdivisions to enable the organizations, institutions, or
2-15     political subdivisions to perform all or a part of those functions.
2-16     To ensure the most efficient, effective, and rapid delivery of
2-17     services, the Texas Board of Health shall give high priority and
2-18     preference to existing, effective state programs that do not
2-19     otherwise receive money from an endowment program funded by money
2-20     received under the Comprehensive Settlement Agreement and Release
2-21     filed in the case styled The State of Texas v. The American Tobacco
2-22     Co., et al., No. 5-96CV-91, in the United States District Court,
2-23     Eastern District of Texas.  The board may adopt rules governing any
2-24     grant program established under this section.
2-25           (e)  The comptroller may solicit and accept gifts and grants
2-26     to the fund.  A gift or grant to the fund may be appropriated in
2-27     the same manner as the interest received from investment of the
 3-1     fund, subject to any limitation or requirement placed on the gift
 3-2     or grant by the donor or granting entity.
 3-3           (f)  Money in the fund may also be appropriated to pay any
 3-4     amount of money that the federal government determines that the
 3-5     state should repay to the federal government or that the federal
 3-6     government should recoup from the state in the event of national
 3-7     legislation regarding the subject matter of the case styled The
 3-8     State of Texas v. The American Tobacco Co., et al., No.  5-96CV-91,
 3-9     in the United States District Court, Eastern District of Texas.
3-10           (g)  Sections 403.095 and 404.071 do not apply to the fund.
3-11           Sec. 403.1055.  PERMANENT FUND FOR CHILDREN AND PUBLIC
3-12     HEALTH.  (a)  The permanent fund for children and public health is
3-13     a special fund in the state treasury outside the general revenue
3-14     fund. The fund is composed of:
3-15                 (1)  money transferred to the fund at the direction of
3-16     the legislature;
3-17                 (2)  gifts and grants contributed to the fund; and
3-18                 (3)  the interest received from investment of money in
3-19     the fund.
3-20           (b)  Except as provided by Subsections (c), (e), and (f),
3-21     money in the fund may not be appropriated for any purpose.
3-22           (c)  The interest received from investment of the fund may be
3-23     appropriated to the Texas Department of Health for the purpose of
3-24     developing and demonstrating cost-effective prevention and
3-25     intervention strategies for improving health outcomes for children
3-26     and the public and for providing grants to local communities to
3-27     address public health priorities.
 4-1           (d)  The Texas Board of Health may adopt rules governing any
 4-2     grant program established under this section.
 4-3           (e)  The comptroller may solicit and accept gifts and grants
 4-4     to the fund.  A gift or grant to the fund may be appropriated in
 4-5     the same manner as the interest received from investment of the
 4-6     fund, subject to any limitation or requirement placed on the gift
 4-7     or grant by the donor or granting entity.
 4-8           (f)  Money in the fund may also be appropriated to pay any
 4-9     amount of money that the federal government determines that the
4-10     state should repay to the federal government or that the federal
4-11     government should recoup from the state in the event of national
4-12     legislation regarding the subject matter of the case styled The
4-13     State of Texas v. The American Tobacco Co., et al., No.  5-96CV-91,
4-14     in the United States District Court, Eastern District of Texas.
4-15           (g)  Sections 403.095 and 404.071 do not apply to the fund.
4-16           Sec. 403.106.  PERMANENT FUND FOR EMERGENCY MEDICAL SERVICES
4-17     AND TRAUMA CARE.  (a)  The permanent fund for emergency medical
4-18     services and trauma care is a special fund in the state treasury
4-19     outside the general revenue fund.  The fund is composed of:
4-20                 (1)  money transferred to the fund at the direction of
4-21     the legislature;
4-22                 (2)  gifts and grants contributed to the fund; and
4-23                 (3)  the interest received from investment of money in
4-24     the fund.
4-25           (b)  Except as provided by Subsections (c), (e), and (f),
4-26     money in the fund may not be appropriated for any purpose.
4-27           (c)  The interest received from investment of the fund may be
 5-1     appropriated to the Texas Department of Health for programs to
 5-2     provide emergency medical services and trauma care in this state.
 5-3           (d)  Subject to any applicable limit in the General
 5-4     Appropriations Act, the Texas Department of Health may establish
 5-5     programs to provide emergency medical services and trauma care in
 5-6     this state, may contract with another entity to establish those
 5-7     programs, or may award grants to political subdivisions to
 5-8     establish or support those programs.  The department may
 5-9     consolidate any grant program established under this section with
5-10     other grant programs relating to the provision of emergency medical
5-11     services and trauma care.  The Texas Board of Health may adopt
5-12     rules governing the grant program.
5-13           (e)  The comptroller may solicit and accept gifts and grants
5-14     to the fund.  A gift or grant to the fund may be appropriated in
5-15     the same manner as the interest received from investment of the
5-16     fund, subject to any limitation or requirement placed on the gift
5-17     or grant by the donor or granting entity.
5-18           (f)  Money in the fund may also be appropriated to pay any
5-19     amount of money that the federal government determines that the
5-20     state should repay to the federal government or that the federal
5-21     government should recoup from the state in the event of national
5-22     legislation regarding the subject matter of the case styled The
5-23     State of Texas v. The American Tobacco Co., et al., No.  5-96CV-91,
5-24     in the United States District Court, Eastern District of Texas.
5-25           (g)  Sections 403.095 and 404.071 do not apply to the fund.
5-26           Sec. 403.1065.  PERMANENT FUND FOR RURAL HEALTH FACILITY
5-27     CAPITAL IMPROVEMENT.  (a)  The permanent fund for rural health
 6-1     facility capital improvement is a special fund in the state
 6-2     treasury outside the general revenue fund.  The fund is composed
 6-3     of:
 6-4                 (1)  money transferred to the fund at the direction of
 6-5     the legislature;
 6-6                 (2)  payments of interest and principal on loans made
 6-7     under Subchapter G, Chapter 106, Health and Safety Code, and fees
 6-8     collected under that subchapter;
 6-9                 (3)  gifts and grants contributed to the fund; and
6-10                 (4)  the interest received from investment of money in
6-11     the fund.
6-12           (b)  Except as provided by Subsections (c), (d), and (e),
6-13     money in the fund may not be appropriated for any purpose.
6-14           (c)  The interest received from investment of the fund may be
6-15     appropriated to the Center for Rural Health Initiatives for the
6-16     purposes of Subchapter G, Chapter 106, Health and Safety Code.
6-17           (d)  The comptroller may solicit and accept gifts and grants
6-18     to the fund.  A gift or grant to the fund may be appropriated in
6-19     the same manner as the interest received from investment of the
6-20     fund, subject to any limitation or requirement placed on the gift
6-21     or grant by the donor or granting entity.
6-22           (e)  Money in the fund may also be appropriated to pay any
6-23     amount of money that the federal government determines that the
6-24     state should repay to the federal government or that the federal
6-25     government should recoup from the state in the event of national
6-26     legislation regarding the subject matter of the case styled The
6-27     State of Texas v. The American Tobacco Co., et al., No.  5-96CV-91,
 7-1     in the United States District Court, Eastern District of Texas.
 7-2           (f)  Sections 403.095 and 404.071 do not apply to the fund.
 7-3           Sec. 403.1067.  COMMUNITY HOSPITAL CAPITAL IMPROVEMENT FUND.
 7-4     (a)  The community hospital capital improvement fund is a special
 7-5     fund in the state treasury outside the general revenue fund.  The
 7-6     fund is composed of:
 7-7                 (1)  money transferred to the fund at the direction of
 7-8     the legislature;
 7-9                 (2)  payments of interest and principal on loans and
7-10     fees collected under this section;
7-11                 (3)  gifts and grants contributed to the fund; and
7-12                 (4)  the interest received from investment of money in
7-13     the fund.
7-14           (b)  Except as provided by Subsections (c), (d), and (e), the
7-15     money in the fund may not be appropriated for any purpose.
7-16           (c)  The interest received from the investment of the fund
7-17     may be appropriated to the Texas Department of Health for the
7-18     purpose of providing grants, loans, or loan guarantees to public or
7-19     nonprofit community hospitals with 125 beds or fewer located in an
7-20     urban area of the state.
7-21           (d)  The comptroller may solicit and accept gifts and grants
7-22     to the fund.  A gift or grant to the fund may be appropriated in
7-23     the same manner as the interest received from investment of the
7-24     fund, subject to any limitation or requirement placed on the gift
7-25     or grant by the donor or granting entity.
7-26           (e)  Money in the fund may also be appropriated to pay any
7-27     amount of money that the federal government determines that the
 8-1     state should repay to the federal government or that the federal
 8-2     government should recoup from the state in the event of national
 8-3     legislation regarding the subject matter of the case styled The
 8-4     State of Texas v. The American Tobacco Co., et al., No.  5-96CV-91,
 8-5     in the United States District Court, Eastern District of Texas.
 8-6           (f)  The Texas Board of Health may adopt rules governing any
 8-7     grant, loan, or loan guarantee program established under this
 8-8     section.
 8-9           (g)  A hospital eligible to receive a grant, loan, or loan
8-10     guarantee under Chapter 106, Subchapter G, Health and Safety Code,
8-11     is not eligible to receive a grant, loan, or loan guarantee under
8-12     this section.
8-13           (h)  Sections 403.095 and 404.071 do not apply to the fund.
8-14           Sec. 403.108.  REPORTING REQUIREMENT.  The department shall
8-15     provide a report on the permanent funds established under this
8-16     subchapter to the Legislative Budget Board no later than November 1
8-17     of each year.  The report shall include the total amount of money
8-18     distributed from each fund, the purpose for which the money was
8-19     used, and any additional information that may be requested by the
8-20     Legislative Budget Board.
8-21           SECTION 2.  Subchapter G, Chapter 403, Government Code, is
8-22     amended by adding Section 403.1066 to read as follows:
8-23           Sec. 403.1066.  RESTRICTIONS ON LOBBYING EXPENDITURES.  (a)
8-24     An organization, program, political subdivision, public institution
8-25     of higher education, local community organization, or other entity
8-26     receiving funds or grants from the permanent funds in Sections
8-27     403.105, 403.1055, 403.106, and 403.1065, Government Code, may not
 9-1     use the funds or grants to pay:
 9-2                 (1)  lobbying expenses incurred by the recipient;
 9-3                 (2)  a person or entity that is required to register
 9-4     with the Texas Ethics Commission under Chapter 305, Government
 9-5     Code;
 9-6                 (3)  any partner, employee, employer, relative,
 9-7     contractor, consultant, or related entity of a person or entity
 9-8     described by Subdivision (2); or
 9-9                 (4)  a person or entity who has been hired to represent
9-10     associations or other entities for the purpose of affecting the
9-11     outcome of legislation, agency rules, ordinances, or other
9-12     government policies.
9-13           (b)  The persons or entities described by Subsection (a) are
9-14     not eligible to receive the money or participate either directly or
9-15     indirectly in the contracts, funds, or grants awarded in Sections
9-16     403.105, 403.1055, 403.106, and 403.1065, Government Code.
9-17           (c)  Grants or awards made under Sections 403.105, 403.1055,
9-18     403.106, and 403.1065, Government Code, may not be conditioned on
9-19     the enactment of legislation, agency rules, or local ordinances.
9-20           SECTION 3.  Chapter 106, Health and Safety Code, is amended
9-21     by adding Subchapter G to read as follows:
9-22          SUBCHAPTER G.  RURAL HEALTH FACILITY CAPITAL IMPROVEMENT
9-23           Sec. 106.201.  DEFINITIONS.  In this subchapter:
9-24                 (1)  "Public hospital" means a general or special
9-25     hospital licensed under Chapter 241 that is owned or operated by a
9-26     municipality, county, municipality and county, hospital district,
9-27     or hospital authority and that performs inpatient or outpatient
 10-1    services.
 10-2                (2)  "Rural county" means:
 10-3                      (A)  a county that has a population of 50,000 or
 10-4    less; or
 10-5                      (B)  with respect to a county that has a
 10-6    population of more than 50,000 and that contains a geographic area
 10-7    that is not delineated as urbanized by the federal census bureau,
 10-8    that part of the county that is not delineated as urbanized.
 10-9          Sec. 106.202.  POWERS OF CENTER.  In administering this
10-10    subchapter, the center may:
10-11                (1)  enter into and enforce contracts and execute and
10-12    deliver conveyances and other instruments necessary to make and
10-13    administer grants, loans, and loan guarantees under this
10-14    subchapter;
10-15                (2)  employ personnel and counsel necessary to
10-16    implement this subchapter and pay them from money in the fund
10-17    appropriated for that purpose;
10-18                (3)  impose and collect reasonable fees and charges in
10-19    connection with grants, loans, and loan guarantees made under this
10-20    subchapter and provide reasonable penalties for delinquent payment
10-21    of fees, charges, or loan repayments;
10-22                (4)  take and enforce a mortgage or appropriate
10-23    security interest in real or personal property that a loan
10-24    recipient acquires with the proceeds of a loan made under this
10-25    subchapter; and
10-26                (5)  adopt rules necessary to implement the grant,
10-27    loan, and loan guarantee program.
 11-1          Sec. 106.203.  GRANT, LOAN, AND LOAN GUARANTEE PROGRAM.  (a)
 11-2    The center may use money appropriated to the center under Section
 11-3    403.1065, Government Code, to make a grant or low interest loan to,
 11-4    or guarantee a loan for, a public or nonprofit hospital located in
 11-5    a rural county.
 11-6          (b)  A grant, loan, or loan guarantee recipient may use the
 11-7    money only to make capital improvements to existing health
 11-8    facilities located in a rural county, to construct new health
 11-9    facilities in a rural county, or to purchase capital equipment,
11-10    including information systems hardware and software, for a health
11-11    facility located in a rural county.
11-12          Sec. 106.204.  ELIGIBILITY FOR GRANT, LOAN, OR LOAN
11-13    GUARANTEE; INTEREST RATE.  (a)  The center shall adopt rules that
11-14    establish eligibility criteria for receiving a grant, loan, or loan
11-15    guarantee under this subchapter.
11-16          (b)  The rules must state generally the factors the center
11-17    will consider in determining whether an applicant should receive a
11-18    grant, loan, or loan guarantee.  The rules must allow the center to
11-19    give preferential consideration to public hospitals and to consider
11-20    at least the financial need of the applicant, the health care needs
11-21    of the rural area served by the applicant, and the probability that
11-22    the applicant will effectively and efficiently use the money
11-23    obtained through the grant, loan, or loan guarantee to meet the
11-24    health care needs of the rural area served by the applicant.
11-25          (c)  The rules must state generally the factors the center
11-26    will consider in determining the extent to which the interest rate
11-27    on a loan should be below market rates.
 12-1          SECTION 4.  On the effective date of this Act, the
 12-2    comptroller shall transfer:
 12-3                (1)  $200 million from the general revenue fund to the
 12-4    permanent fund for tobacco education and enforcement  established
 12-5    by Section 403.105, Government Code, as added by this Act;
 12-6                (2)  $125 million from the general revenue fund to the
 12-7    permanent fund for children and public health  established by
 12-8    Section 403.1055, Government Code, as added by this Act;
 12-9                (3)  $100 million from the general revenue fund to the
12-10    permanent fund for emergency medical services and trauma care
12-11    established by Section 403.106, Government Code, as added by this
12-12    Act;
12-13                (4)  $50 million from the general revenue fund to the
12-14    permanent fund for rural health facility capital improvement
12-15    established by Section 403.1065, Government Code, as added by this
12-16    Act; and
12-17                (5)  $25 million from the general revenue fund to the
12-18    community hospital capital improvement fund established by Section
12-19    403.1067, Government Code, as added by this Act.
12-20          SECTION 5.  This Act takes effect August 31, 1999.
12-21          SECTION 6.  The importance of this legislation and the
12-22    crowded condition of the calendars in both houses create an
12-23    emergency and an imperative public necessity that the
12-24    constitutional rule requiring bills to be read on three several
12-25    days in each house be suspended, and this rule is hereby suspended.