By Counts                                             H.B. No. 3050
         76R7129 BDH-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the development of agricultural enterprises and
 1-3     programs.
 1-5           SECTION 1.  Sections 44.001(3), (5), and (6), Agriculture
 1-6     Code, are amended to read as follows:
 1-7                 (3)  "Eligible borrower" means a person who is in the
 1-8     business or entering the business of:
 1-9                       (A)  processing and marketing agricultural crops
1-10     in this state;
1-11                       (B)  producing alternative agricultural crops in
1-12     this state;
1-13                       (C)  producing agricultural crops in this state
1-14     the production of which has declined [markedly] because of natural
1-15     disasters; or
1-16                       (D)  producing agricultural crops in this state
1-17     using water conservation equipment for agricultural production
1-18     purposes.
1-19                 (5)  "Linked deposit" means a time deposit governed by
1-20     a written deposit agreement between the state and an eligible
1-21     lending institution that provides:
1-22                       (A)  that the eligible lending institution pay
1-23     interest on the deposit at a rate that is not less than the greater
1-24     of:
 2-1                             (i)  the current market rate of a United
 2-2     States treasury bill or note of comparable maturity minus two
 2-3     percent; or
 2-4                             (ii)  1.5 percent;
 2-5                       (B)  that the state not withdraw any part of the
 2-6     deposit before the expiration of a period set by a written advance
 2-7     notice of the intention to withdraw; and
 2-8                       (C)  that the eligible lending institution agree
 2-9     to lend the value of the deposit to an eligible borrower at a
2-10     maximum rate that is the [current market] rate paid on the linked
2-11     deposit [of a United States treasury bill or note of  comparable
2-12     maturity] plus not more than four percent.
2-13                 (6)  "Microenterprise" means a small business located
2-14     in a rural area in which the owner operates [and the owner's family
2-15     provide the bulk of the management and a significant amount of the
2-16     labor required to operate] the  enterprise.  Priority under this
2-17     chapter shall be given to microenterprises which demonstrate
2-18     significant potential for expansion that will provide jobs in
2-19     economically depressed rural communities or to currently unemployed
2-20     rural residents.
2-21           SECTION 2.  Section 44.002, Agriculture Code, is amended to
2-22     read as follows:
2-24     [(a)  The board shall create an agricultural diversification
2-25     program to:]
2-26                 [(1)  support commercial use of agricultural research
2-27     and innovation;]
 3-1                 [(2)  increase the capabilities of community and
 3-2     regional organizations to train and assist new or expanding
 3-3     agricultural-based businesses;]
 3-4                 [(3)  start small business incubators; and]
 3-5                 [(4)  encourage private commercial loans for enhanced
 3-6     production, processing, and marketing of certain agricultural
 3-7     crops.]
 3-8           [(b)]  The board shall create a microenterprise support
 3-9     program to provide financial assistance to microenterprises in
3-10     rural areas.
3-11           SECTION 3.  Sections 44.0045(b), (c), and (d), Agriculture
3-12     Code, are amended to read as follows:
3-13           (b)  An applicant for a loan on behalf of a [A] proposed
3-14     microenterprise [loan applicant] may receive a loan of up to
3-15     $25,000 [$15,000] to begin operation of the microenterprise.
3-16           (c)  An applicant for a loan on behalf of an [An] established
3-17     microenterprise [loan applicant] may receive a loan of up to
3-18     $50,000 [$30,000] to expand, modernize, or otherwise improve an
3-19     established activity or operation of the microenterprise.
3-20           (d)  The board [of the microenterprise support program] may
3-21     reserve a portion of the rural enterprises microdevelopment account
3-22     [total fund] for use in cooperative loan programs established with
3-23     the participation of other public or private lenders.
3-24           SECTION 4.  Sections 44.007(b), (d), (e), (f), (h), and (k),
3-25     Agriculture Code, are amended to read as follows:
3-26           (b)  The board shall promulgate rules for the loan portion of
3-27     the linked deposit program.  The rules must include:
 4-1                 (1)  a list, compiled with consideration of relevant
 4-2     information available from the Texas Agricultural Statistics
 4-3     Service, of the categories of crops customarily grown in Texas;
 4-4                 (2)  a list, compiled with consideration of relevant
 4-5     information available from the Texas Agricultural Statistics
 4-6     Service, of crops that are  alternative agricultural crops;
 4-7                 (3)  eligibility criteria for [a list of crops the
 4-8     production of which has declined markedly because of] natural
 4-9     disaster assistance under this chapter [disasters]; and
4-10                 (4)  identification of projects and types of equipment
4-11     considered as water conservation projects or equipment for
4-12     agricultural production purposes.
4-13           (d)  After reviewing an application and determining that the
4-14     applicant is eligible and creditworthy, the eligible lending
4-15     institution shall send the application for a linked deposit loan to
4-16     [the board or] the administrator of the Texas Agricultural Finance
4-17     Authority.
4-18           (e)  The eligible lending institution shall certify the
4-19     interest rate applicable to the specific eligible borrower and
4-20     attach it to the application sent to [the board or] the
4-21     administrator of the Texas Agricultural Finance Authority.
4-22           (f)  After reviewing each linked deposit loan application,
4-23     the board or the commissioner, if the board delegates the authority
4-24     to the commissioner, shall recommend to the comptroller the
4-25     acceptance or rejection of the application.
4-26           (h)  Before the placing of a linked deposit, the eligible
4-27     lending institution and the state, represented by the comptroller
 5-1     [and the board], shall enter into a written deposit agreement
 5-2     containing the conditions on which the linked deposit is made.
 5-3           (k)  A lending institution is not ineligible to participate
 5-4     in the linked deposit program solely because a member of the board
 5-5     is also an officer, director, or employee of the lending
 5-6     institution.  A member of the board who is an officer, director, or
 5-7     employee of a lending institution that is a participant in a
 5-8     program administered by the board must abstain from any action
 5-9     taken by the board regarding the lending institution.
5-10           SECTION 5.  Sections 44.010(a), (b), and (c), Agriculture
5-11     Code, are amended to read as follows:
5-12           (a)  At any one time, not more than $25 [$15] million, of
5-13     which $10 million may only be used to finance water conservation
5-14     projects, may be placed in linked deposits under this chapter.
5-15           (b)  The maximum amount of a loan under this chapter to
5-16     process and market Texas agricultural crops is $500,000. The
5-17     maximum amount of a loan under this chapter to produce alternative
5-18     agricultural crops in this state is $250,000.  The maximum amount
5-19     of a loan under this chapter to finance production of a crop on
5-20     land eligible for national disaster relief, as determined by the
5-21     board, is $250,000.  The maximum amount of a loan under this
5-22     chapter to finance water conservation projects or equipment for
5-23     agricultural production purposes is $250,000.
5-24           (c)  A loan granted pursuant to this chapter must be applied
5-25     to existing debt or used for any agriculture-related operating
5-26     expenses, including the purchase or lease of land, the acquisition
5-27     of fixed assets, or the making of improvements, as identified in
 6-1     the loan application [equipment, seed, fertilizer, direct marketing
 6-2     facilities, or processing facilities, or to payment for
 6-3     professional services].
 6-4           SECTION 6.  Section 44.012, Agriculture Code, is amended to
 6-5     read as follows:
 6-6           Sec. 44.012.  MONEY FOR [GRANTS AND] LOANS.  The board may
 6-7     accept gifts and grants of money from the federal government, local
 6-8     governments, or private corporations or other persons for use in
 6-9     making [grants and] loans under the [agricultural diversification
6-10     program and the] rural microenterprise support program.  The
6-11     legislature may appropriate money for [grants and] loans under the
6-12     program [programs].
6-13           SECTION 7.  Section 44.013, Agriculture Code, is amended to
6-14     read as follows:
6-16     [FUND].  The rural microenterprise development account [fund] is an
6-17     account [a fund] in the general revenue fund [state treasury].
6-18     Money appropriated to the board [Agricultural Diversification
6-19     Board] for use in making loans under the rural microenterprise
6-20     support program, other amounts received by the state for loans made
6-21     under the program, and other money received by the board for the
6-22     program and required by the board to be deposited in the account
6-23     [fund] shall be deposited to the credit of the account [fund].  The
6-24     account [fund] shall operate as a revolving account [fund], the
6-25     contents of which shall be applied and reapplied for the purposes
6-26     of the rural microenterprise support program.
6-27           SECTION 8.  Section 58.002(1), Agriculture Code, is amended
 7-1     to read as follows:
 7-2                 (1)  "Agricultural business" means:
 7-3                       (A)  a business that is or proposes to be engaged
 7-4     in producing, processing, marketing, or exporting an agricultural
 7-5     product;
 7-6                       (B)  an eligible applicant for a loan under
 7-7     Subchapter E;
 7-8                       (C)  an entity designated to carry out boll
 7-9     weevil eradication in accordance with Subchapter D, Chapter 74; or
7-10                       (D)  a business in a rural area of the state, as
7-11     defined and declared a rural area by the board, that provides
7-12     outdoor recreational activities on agricultural land, including
7-13     hiking, fishing, and hunting.
7-14           SECTION 9.  Section 58.016(b), Agriculture Code, is amended
7-15     to read as follows:
7-16           (b)  On or before August 1 of each year, the administrator
7-17     shall file with the board the proposed annual budgets for the young
7-18     farmer loan guarantee program under Subchapter E [Chapter 253], the
7-19     farm and ranch finance program under Chapter 59, and the programs
7-20     administered by the board under this chapter for the succeeding
7-21     fiscal year.  If there is no administrator, the commissioner shall
7-22     assume the duties of the administrator in connection with
7-23     preparation of the budget.  The budget must set forth the general
7-24     categories of expected expenditures out of revenues and income of
7-25     the funds administered by the authority and the amount on account
7-26     of each.  On or before September 1 of each year, the board shall
7-27     consider the proposed annual budget and may approve it or amend it.
 8-1     Copies of the annual budget certified by the chairman of the board
 8-2     shall be promptly filed with the governor and the legislature.  The
 8-3     annual budget is not effective until it is filed.  If for any
 8-4     reason the authority does not adopt an annual budget before
 8-5     September 2, no expenditures may be made from the funds until the
 8-6     board approves the annual budget.  The authority may adopt an
 8-7     amended annual budget for the current fiscal year, but the amended
 8-8     annual budget may not supersede a prior budget until it is filed
 8-9     with the governor and the legislature.
8-10           SECTION 10.  Section 58.0172, Agriculture Code, is amended by
8-11     adding Subsection (e) to read as follows:
8-12           (e)  A lending institution is not ineligible to participate
8-13     in the programs administered by the board solely because a member
8-14     of the board is also an officer, director, or employee of the
8-15     lending institution.  A member of the board who is an officer,
8-16     director, or employee of a lending institution that is a
8-17     participant in a program administered by the board must abstain
8-18     from any action taken by the board regarding the lending
8-19     institution.
8-20           SECTION 11.  Sections  58.021(a), (b), and (c), Agriculture
8-21     Code, are amended to read as follows:
8-22           (a)  In order to promote the development of rural
8-23     agricultural businesses and the expansion, development, and
8-24     diversification of production,  processing, marketing, and export
8-25     of Texas agricultural products, the authority shall design and
8-26     implement programs to provide financial assistance to eligible
8-27     agricultural businesses, including programs:
 9-1                 (1)  to make or acquire loans to eligible agricultural
 9-2     businesses;
 9-3                 (2)  to make or acquire loans to lenders to enable
 9-4     those lenders to make loans to eligible agricultural businesses;
 9-5                 (3)  to insure, coinsure, and reinsure, in whole or in
 9-6     part, loans to eligible agricultural businesses;
 9-7                 (4)  to guarantee, in whole or in part, loans to
 9-8     eligible agricultural businesses; and
 9-9                 (5)  to administer or participate in programs
9-10     established by another person to provide financial assistance to
9-11     eligible agricultural businesses.
9-12           (b)  The authority's programs shall be designed and
9-13     implemented to provide financial assistance to develop rural
9-14     agricultural businesses and to enable eligible agricultural
9-15     businesses to finance or refinance costs incurred in connection
9-16     with the expansion, development, increase, or improvement of
9-17     production, processing, marketing, or export of Texas agricultural
9-18     products, including but not limited to the costs of:
9-19                 (1)  acquisition of and improvements to land or
9-20     interests in land;
9-21                 (2)  acquisition, construction, rehabilitation,
9-22     operation, and maintenance of buildings, improvements, and
9-23     structures;
9-24                 (3)  site preparations;
9-25                 (4)  architectural, engineering, legal, and related
9-26     services;
9-27                 (5)  acquisition, installation, rehabilitation,
 10-1    operation, and maintenance of machinery, equipment, furnishings,
 10-2    and facilities;
 10-3                (6)  acquisition, processing, or distribution of
 10-4    inventory;
 10-5                (7)  research and development;
 10-6                (8)  financing fees and charges;
 10-7                (9)  interest during acquisition or construction;
 10-8                (10)  necessary reserve fund;
 10-9                (11)  acquisition of licenses, permits, and approvals
10-10    from any governmental entity; [and]
10-11                (12)  pre-export and export expenses; and
10-12                (13)  insect eradication and suppression programs.
10-13          (c)  Except as provided by this subsection, the maximum
10-14    aggregate amount of loans made to or guaranteed, insured,
10-15    coinsured, or reinsured under this subchapter for a single eligible
10-16    agricultural business by the authority from funds provided by the
10-17    authority is $2 million.  The authority may make, guarantee,
10-18    insure, coinsure, or reinsure a loan for a single eligible
10-19    agricultural business that results in an aggregate amount exceeding
10-20    $2 million, but not exceeding $5 million, if the action is approved
10-21    by a two-thirds vote of the membership of the board.  The authority
10-22    may make, guarantee, insure, coinsure, or reinsure a loan in an
10-23    amount exceeding $2 million to an entity designated under Section
10-24    74.1011 to carry out boll weevil eradication consistent with
10-25    Subchapter D, Chapter 74.
10-26          SECTION 12.  Section 58.023(a), Agriculture Code, is amended
10-27    to read as follows:
 11-1          (a)  The board shall adopt rules to establish criteria for
 11-2    determining which eligible agricultural businesses may participate
 11-3    in programs that may be established by the board.  The board's
 11-4    rules must state that the policy of the authority is to provide
 11-5    programs for providing financial assistance to eligible
 11-6    agricultural businesses [that otherwise would not be made and] that
 11-7    the board considers to present a reasonable risk and have a
 11-8    sufficient likelihood of repayment.  In establishing criteria for
 11-9    participation, the board shall give priority to eligible
11-10    agricultural businesses that include producers of Texas
11-11    agricultural products in the ownership of the businesses.  The
11-12    board shall adopt collateral or security requirements to ensure the
11-13    full repayment of that financial assistance and the solvency of any
11-14    program implemented under this chapter.  The board shall approve
11-15    any and all extensions of that financial assistance under this
11-16    chapter, provided that the board may delegate this approval
11-17    authority to the administrator or the commissioner.
11-18          SECTION 13.  Chapter 253, Agriculture Code, is transferred to
11-19    Chapter 58, Agriculture Code, redesignated as Subchapter E, and
11-20    renumbered and amended to read as follows:
11-22          Sec. 58.051 [253.001].  DEFINITIONS.  In this subchapter
11-23    [chapter]:
11-24                (1)  ["Board" means the board of directors of the Texas
11-25    Agricultural Finance Authority.]
11-26                [(2)]  "Commercial lender" means a commercial lending
11-27    institution chartered by the state or federal government, including
 12-1    a savings and loan association, a credit union, and a Farm Credit
 12-2    System institution.
 12-3                (2) [(3)]  "Eligible applicant" means a person applying
 12-4    for a loan guarantee under this subchapter [chapter] who:
 12-5                      (A)  is at least 18 years of age but younger than
 12-6    40 years of age;
 12-7                      (B)  has a net worth, as defined by the board, of
 12-8    less than $400,000 [four years of practical farm or ranch
 12-9    experience, with not more than two years of participation in a 4-H
12-10    or an agricultural science and technology program counting as
12-11    practical farm or ranch experience]; and
12-12                      (C)  complies with the application procedures
12-13    prescribed by this subchapter [chapter].
12-14                (3) [(4)]  "Plan" means documentation submitted to a
12-15    lender in support of an application under this subchapter [a cash
12-16    flow, production, or management plan].
12-17          Sec. 58.052 [253.002].  YOUNG FARMER LOAN GUARANTEE PROGRAM.
12-18    (a)  The board shall administer a loan guarantee program that
12-19    benefits eligible applicants who desire to establish their first
12-20    farming or ranching operation or agriculture-related service
12-21    business.
12-22          (b)  The board, directly or through the authority granted to
12-23    the commissioner, may grant to an eligible applicant a guarantee of
12-24    a loan made by a commercial lender for the purposes prescribed by
12-25    this subchapter [chapter].  The guarantee amount may not exceed the
12-26    lesser of $250,000 [$100,000] or 90 percent of the total loan
12-27    amount.
 13-1          (c)  The aggregate amount guaranteed under this subchapter
 13-2    [chapter] may not exceed twice the amount of current appropriations
 13-3    from the young farmer loan guarantee account.
 13-4          (d)  A loan guarantee recipient may use proceeds from the
 13-5    loan only for working capital for operating a farm or ranch,
 13-6    including the lease of facilities, or agriculture-related service
 13-7    business.   A loan guarantee recipient may not use loan proceeds to
 13-8    purchase land.  A loan guarantee is voidable by the board if the
 13-9    recipient uses loan proceeds for a purpose other than a purpose
13-10    identified in the plan [working capital for operating a farm or
13-11    ranch].  The board shall include this restriction as a condition in
13-12    each loan guarantee instrument executed under this subchapter
13-13    [chapter].
13-14          (e)  The board shall adopt [may enter] an agreement to be
13-15    used by [with] a commercial lender and a borrower under which the
13-16    board provides a payment from money in the young farmer loan
13-17    guarantee account for the purpose of providing a reduced interest
13-18    rate on a loan guaranteed to a borrower under this subchapter
13-19    [chapter].  The board shall adopt rules to implement this
13-20    subsection.  The maximum rate reduction under this subsection shall
13-21    not exceed three percentage points.
13-22          Sec. 58.053 [253.003].  APPLICATION FOR LOAN GUARANTEE.  (a)
13-23    An eligible applicant must present to the board for the board's
13-24    review:
13-25                (1)  the [a] plan the applicant has submitted to the
13-26    commercial lender for the applicant's proposed farm or ranch
13-27    operation or agriculture-related service business, including a
 14-1    proposed budget [that has been reviewed and approved by an
 14-2    individual who:]
 14-3                      [(A)  teaches agricultural science and technology
 14-4    in the applicant's school district; or]
 14-5                      [(B)  is a county extension agent-agriculture
 14-6    program leader of the Texas Agricultural Extension Service in the
 14-7    area where the farm or ranch is located];
 14-8                (2)  a completed application for a loan from a
 14-9    commercial lender on which the eligible applicant has indicated how
14-10    [that] the loan proceeds will be used to implement the applicant's
14-11    plan; and
14-12                (3)  the signed statement of a loan officer of the
14-13    commercial lender that a loan guarantee is required for approval of
14-14    the loan application.
14-15          (b)  [A district agricultural economist employed by the Texas
14-16    Agricultural Extension Service shall assist with review and
14-17    approval of a plan under Subsection (a)(1) of this section if
14-18    requested to do so by the individual responsible for the review and
14-19    approval.]
14-20          [(c)]  The board may charge a reasonable application fee for
14-21    processing an application filed under this section.
14-22          Sec. 58.054 [253.004].  BOARD CONSIDERATION OF LOAN GUARANTEE
14-23    APPLICATION.  After reviewing the materials submitted under Section
14-24    58.053 [253.003] of this chapter, the board shall consider the
14-25    following factors in deciding whether to approve an application for
14-26    a loan guarantee:
14-27                (1)  the anticipated benefits from granting a loan
 15-1    guarantee to the applicant, including both potential job creation
 15-2    and commercial benefits to the agricultural industry;
 15-3                (2)  the applicant's qualifications;
 15-4                (3)  the feasibility of the applicant's plan; and
 15-5                (4)  the [other funding] sources available to the
 15-6    applicant for repayment of the loan.
 15-7          Sec. 58.055 [253.005].  DEFAULT.  If the recipient of a loan
 15-8    guarantee defaults on a loan that is guaranteed under this
 15-9    subchapter [chapter], and the authority [department] is required to
15-10    honor its guarantee, the authority [department], through its
15-11    representative, may bring suit against the defaulting party.  The
15-12    suit must [may] be brought in [the county in which the defaulting
15-13    party resides, in which the commercial lender is located, or in]
15-14    Travis County.
15-15          Sec. 58.056 [253.006].  MONEY FOR LOAN GUARANTEE PROGRAM.
15-16    The authority [commissioner] may solicit and accept gifts and
15-17    grants of money from the federal government, local governments,
15-18    private corporations, or other persons for use in the young farmer
15-19    loan guarantee program.  The legislature may appropriate money for
15-20    the program.
15-21          Sec. 58.057 [253.007].  YOUNG FARMER LOAN GUARANTEE ACCOUNT.
15-22    (a)  The young farmer loan guarantee account is an account in the
15-23    Texas Agricultural Fund [general revenue fund].  Money in the
15-24    account may be appropriated only to the authority [department] for
15-25    the purpose of making or administering loan guarantees under this
15-26    subchapter [chapter].
15-27          (b)  The account consists of appropriations and transfers
 16-1    made to the account, grants and donations made for the purposes of
 16-2    the young farmer loan guarantee program, income earned on money in
 16-3    the account, and any other money received under this subchapter
 16-4    [chapter].  Notwithstanding Section 404.071, Government Code,
 16-5    income and interest earned on money in the account shall be
 16-6    deposited to the credit of the account.  The account is exempt from
 16-7    the application of Section [Sections 403.094(h) and (i) and]
 16-8    403.095, Government Code.
 16-9          (c)  The board may spend not more than $100,000 during each
16-10    fiscal year from income earned on the account and from application
16-11    fees collected [by the department] under Section 58.053 [253.003 of
16-12    this code] to pay the costs of administering the program.
16-13          (d)  The board shall attempt to administer the account [fund]
16-14    in a manner that makes private donations to the account [fund] an
16-15    eligible itemized deduction for federal income taxation.
16-16          (e)  The board has the same authority in administering the
16-17    young farmer loan guarantee program as it has in administering
16-18    other programs established [by the board] under this chapter
16-19    [Chapter 58 of this code].
16-20          SECTION 14.  Section 502.174(b), Transportation Code, is
16-21    amended to read as follows:
16-22          (b)  The county assessor-collector shall send an assessment
16-23    collected under this section to the comptroller, at the time and in
16-24    the manner prescribed by the Texas Agricultural Finance Authority,
16-25    for deposit in the Texas Agricultural Fund [general revenue fund]
16-26    to the credit of the young farmer loan guarantee account.
16-27          SECTION 15.  Section 481.0067, Government Code, is
 17-1    transferred to Chapter 12, Agriculture Code, and redesignated as
 17-2    Section 12.038, Agriculture Code, to read as follows:
 17-3          Sec. 12.038 [481.0067].  OFFICE OF RURAL AFFAIRS.  (a)  The
 17-4    department shall establish and maintain an Office of Rural Affairs.
 17-5    The office shall be headed by a rural affairs director.  To be
 17-6    eligible to serve as the rural affairs director, a person must have
 17-7    demonstrated a strong commitment to and involvement in economic
 17-8    development activities in rural areas.
 17-9          (b)  The Office of Rural Affairs shall:
17-10                (1)  develop a rural resource guide and provide the
17-11    information to rural areas through print and electronic media and
17-12    through use of the Texas Business and Community Economic
17-13    Development Clearinghouse;
17-14                (2)  provide information to state agencies on the
17-15    effects of proposed policies or actions that affect rural areas;
17-16                (3)  cosponsor meetings, to the extent practical, in
17-17    cooperation with public and private educational institutions to
17-18    disseminate information beneficial to rural areas;
17-19                (4)  identify potential opportunities for businesses in
17-20    rural areas and assist these businesses to maximize those
17-21    opportunities;
17-22                (5)  conduct an analysis of the available federal,
17-23    state, and local government and rural economic development business
17-24    outreach and data services in rural areas of this state by
17-25    examining the availability of:
17-26                      (A)  computerized economic development databases
17-27    that provide data for existing and prospective businesses and
 18-1    communities in rural areas of this state; and
 18-2                      (B)  business information outreach service
 18-3    offices or centers that provide comprehensive technical assistance,
 18-4    research, consulting services, training, and other services to
 18-5    businesses in rural areas; and
 18-6                (6)  perform any other functions necessary to carry out
 18-7    the purposes of this section.
 18-8          (c)  In administering this section, the department may:
 18-9                (1)  employ and set the compensation of personnel to
18-10    carry out the Office of Rural Affairs' functions under this
18-11    section; and
18-12                (2)  consult with:
18-13                      (A)  experts and authorities in the fields of
18-14    rural development, economic development, and community development;
18-15                      (B)  individuals with regulatory, legal,
18-16    economic, or financial expertise, including members of the academic
18-17    community; and
18-18                      (C)  individuals who represent the public
18-19    interest.
18-20          (d)  Each state agency must, on request, furnish the Office
18-21    of Rural Affairs with reports and other information necessary to
18-22    enable the Office of Rural Affairs to carry out the purposes of
18-23    this section.
18-24          (e)  The Office of Rural Affairs may accept gifts, grants,
18-25    and donations from sources other than the state for the purpose of
18-26    performing specific projects, studies, or procedures or to provide
18-27    assistance to rural areas.
 19-1          (f)  Not later than September 1 of each even-numbered year,
 19-2    the department shall submit to the governor and the legislature a
 19-3    report containing specific information regarding each of the
 19-4    functions performed by the Office of Rural Affairs, including
 19-5    recommendations regarding issues that affect the rural areas of the
 19-6    state.
 19-7          SECTION 16.  Sections 44.001(1), 44.004, 44.0045(e), 44.005,
 19-8    44.006, 44.010(d), and 44.011, Agriculture Code, are repealed.
 19-9          SECTION 17.  (a)  This Act takes effect September 1, 1999.
19-10          (b)  As soon as practicable after the effective date of this
19-11    Act, but not later than January 1, 2000:
19-12                (1)  all powers, duties, rights, and obligations of the
19-13    Texas Department of Economic Development relating to the Office of
19-14    Rural Affairs are transferred to the commissioner of agriculture
19-15    and the Department of Agriculture, as specified by this Act;
19-16                (2)  except as provided by Subsection (c) of this
19-17    section, all assets, liabilities, personnel, equipment, data,
19-18    documents, facilities, and other items relating to the Office of
19-19    Rural Affairs are transferred from the Texas Department of Economic
19-20    Development to the Department of Agriculture; and
19-21                (3)  any appropriation to the Texas Department of
19-22    Economic Development relating to the Office of Rural Affairs is
19-23    transferred to the Department of Agriculture.
19-24          (c)  The governing board of the Texas Department of Economic
19-25    Development may decide whether to transfer to the Department of
19-26    Agriculture:
19-27                (1)  personnel who perform both duties that relate to
 20-1    the Office of Rural Affairs and duties that do not relate to the
 20-2    Office of Rural Affairs; and
 20-3                (2)  assets used by both the Office of Rural Affairs
 20-4    and divisions of the Texas Department of Economic Development other
 20-5    than the Office of Rural Affairs.
 20-6          (d)  The officers and employees of the Texas Department of
 20-7    Economic Development and the Department of Agriculture shall
 20-8    cooperate fully with the transfer.
 20-9          (e)  The transfer of functions under Subsection (b) of this
20-10    section shall occur on the date specified in an interagency
20-11    contract among the governing board of the Texas Department of
20-12    Economic Development, the director of the Office of Rural Affairs,
20-13    and the Department of Agriculture.
20-14          (f)  Notwithstanding the change made by this Act, the
20-15    governing board of the Texas Department of Economic Development
20-16    retains all powers and duties relating to the Office of Rural
20-17    Affairs until the effective date of the transfer under Subsection
20-18    (b) of this section.
20-19          (g)  A change in law made by this Act does not affect the
20-20    validity of any action taken by the governing board of the Texas
20-21    Department of Economic Development relating to the Office of Rural
20-22    Affairs before the effective date of the change in law.
20-23          SECTION 18.  The importance of this legislation and the
20-24    crowded condition of the calendars in both houses create an
20-25    emergency and an imperative public necessity that the
20-26    constitutional rule requiring bills to be read on three several
20-27    days in each house be suspended, and this rule is hereby suspended.