By Reyna of Bexar H.B. No. 3135 76R8245 AJA-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to state funding and agreements supporting the bids of 1-3 certain municipalities or counties to host the 2007 Pan American 1-4 Games; providing a penalty. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. DEFINITIONS. In this Act: 1-7 (1) "Department" means the Texas Department of 1-8 Economic Development. 1-9 (2) "Endorsing municipality" means a municipality that 1-10 has a population of 850,000 or more according to the most recent 1-11 federal decennial census and that authorizes a bid by a qualified 1-12 applicant for selection of the municipality as the site of the 2007 1-13 Pan American Games. 1-14 (3) "Games" means the 2007 Pan American Games. 1-15 (4) "Games support contract" means a contract executed 1-16 by the department and a qualified applicant containing terms 1-17 permitted or required by this Act. 1-18 (5) "Participating municipality or county" means a 1-19 municipality or county, including an endorsing municipality, that 1-20 has entered into an agreement with a qualified applicant to 1-21 provide, either directly, through a nonprofit corporation created 1-22 under Section 4B, Development Corporation Act of 1979 (Article 1-23 5190.6, Vernon's Texas Civil Statutes), or through a sports and 1-24 community venue district created under Chapter 335, Local 2-1 Government Code, sports venues or facilities that may be used in 2-2 the presentation of any portion of the games. 2-3 (6) "Qualified applicant" means a nonprofit 2-4 corporation that: 2-5 (A) has been authorized by an endorsing 2-6 municipality to pursue an application and bid on the applicant's 2-7 behalf to the Pan American Sports Organization for selection as the 2-8 site of the 2007 Pan American Games; and 2-9 (B) has executed: 2-10 (i) a bid committee agreement with the 2-11 United States Olympic Committee; or 2-12 (ii) an agreement with the Pan American 2-13 Sports Organization regarding a bid to host the Pan American Games. 2-14 (7) "Regional games support authority" means an 2-15 authority created under Section 6 of this Act. 2-16 (8) "Site selection application costs" are costs or 2-17 expenses incurred by a qualified applicant for the preparation of 2-18 the application submitted to the applicable site selection 2-19 organization. The term includes professional services costs for 2-20 which the qualified applicant may seek reimbursement under the 2-21 games support contract, including costs incurred for: 2-22 (A) engineering or architectural planning, 2-23 studies, reports, or designs relating to venue sites for the games; 2-24 (B) environmental impact analyses; 2-25 (C) analyses of transportation needs and 2-26 requirements for the games; 2-27 (D) legal and accounting services; and 3-1 (E) other professional service requirements 3-2 related to the games. 3-3 (9) "Site selection date" means the date on which the 3-4 Pan American Sports Organization designates the site for the 2007 3-5 Pan American Games. 3-6 (10) "Site selection organization" means the Pan 3-7 American Sports Organization. 3-8 SECTION 2. PURPOSE. The purpose of this Act is: 3-9 (1) to provide a method of limited financial support 3-10 that the state, on a neutral basis, may provide to municipalities 3-11 and other persons to assist in the preparation and submission of 3-12 applications to the Pan American Sports Organization for 3-13 designation of a site in this state as the site of the 2007 Pan 3-14 American Games; and 3-15 (2) if a location in the state is designated as the 3-16 site for the 2007 Pan American Games, to provide financial support 3-17 to the designated municipality and other persons and to provide 3-18 assurances to the site selection organization sponsoring the games 3-19 that commitments made by the state through the department in a 3-20 games support contract will be fulfilled. 3-21 SECTION 3. LEGISLATIVE FINDINGS. The conduct in this state 3-22 of the 2007 Pan American Games will: 3-23 (1) provide invaluable public visibility throughout 3-24 the world for this state and the communities where the games are 3-25 held; and 3-26 (2) encourage and provide major economic benefits to 3-27 the communities where the games are held and to the entire state. 4-1 SECTION 4. PAN AMERICAN GAMES SUPPORT FUND. (a) If a site 4-2 selection organization selects a site for the 2007 Pan American 4-3 Games in this state pursuant to an application by a qualified 4-4 applicant, beginning on the first day of the first state fiscal 4-5 year that begins after the site selection date, the comptroller 4-6 shall determine for each calendar month, in accordance with 4-7 procedures developed by the comptroller, the incremental increase 4-8 in the state sales and use tax receipts under Chapter 151, Tax 4-9 Code, within the market area of the qualified applicant whose site 4-10 application has been accepted by the applicable site selection 4-11 organization that is reasonably attributable to the successful 4-12 application and preparation for and the presentation of the 4-13 applicable games and related events. 4-14 (b) The comptroller shall deposit the amount determined 4-15 under Subsection (a) of this section into a special account of the 4-16 department's treasury account called the Pan American Games support 4-17 fund. The comptroller shall discontinue deposit of the amount 4-18 determined under Subsection (a) of this section at the end of the 4-19 third calendar month following the month in which the closing event 4-20 of the games occurs. 4-21 (c) The qualified applicant shall propose the geographic 4-22 boundaries of the market area to be used under Subsection (a) of 4-23 this section. The department shall approve the proposed market 4-24 area if it includes areas that are likely to be affected by the 4-25 conduct of the games the applicant is seeking, including any areas 4-26 that are likely to provide venues, accommodations, and services in 4-27 connection with the games, based on the proposal submitted by the 5-1 applicant under Section 5 of this Act. 5-2 (d) The department may use the funds in the Pan American 5-3 Games support fund to fulfill the state's obligations to a site 5-4 selection organization under a games support contract or any other 5-5 agreement providing assurances from the department to a site 5-6 selection organization. 5-7 SECTION 5. ASSISTANCE OF DEPARTMENT AND OTHER STATE 5-8 AGENCIES. (a) The department shall review requests from a 5-9 qualified applicant that the department enter into a games support 5-10 contract with the applicant. 5-11 (b) A request made under Subsection (a) of this section must 5-12 be accompanied by: 5-13 (1) a general description and summary of the games for 5-14 which a site selection is sought by the qualified applicant; 5-15 (2) a preliminary and general description of the 5-16 proposal the applicant intends to submit to a site selection 5-17 organization; 5-18 (3) the estimated cost of preparing and submitting the 5-19 intended proposal; 5-20 (4) the applicant's intended method of obtaining the 5-21 funds needed for the purpose of preparing the proposal; and 5-22 (5) a description by type and approximate amount of 5-23 the site selection application costs for which the qualified 5-24 applicant intends to seek payment or reimbursement from the state 5-25 under a games support contract. 5-26 (c) The department shall approve or deny a request made 5-27 under Subsection (a) of this section not later than the 30th day 6-1 after the date the request is submitted. 6-2 (d) The department shall approve a request and shall enter 6-3 into a games support contract with a qualified applicant if the 6-4 department determines that: 6-5 (1) the applicant's proposal is reasonable and, if 6-6 completed and submitted, would substantially meet the criteria for 6-7 proposals established by the applicable site selection 6-8 organization; and 6-9 (2) the method of obtaining funds to cover the costs 6-10 of preparing the proposal is commercially reasonable and is likely 6-11 to be successful. 6-12 (e) The department may agree in a games support contract to: 6-13 (1) pay from funds appropriated for that purpose, 6-14 during the period before the applicable site selection date, a 6-15 specified portion of the site selection application costs; and 6-16 (2) provide to the applicable site selection 6-17 organization written assurances on behalf of the state and the 6-18 qualified applicant that, if the applicant's proposal is accepted 6-19 and the site identified in the proposal is selected, and if 6-20 necessary in addition to funds provided by the qualified applicant, 6-21 sufficient funds will be provided by the state from money on 6-22 deposit in the Pan American Games support fund to pay the costs of 6-23 presenting the games in accordance with the qualified applicant's 6-24 proposal. 6-25 (f) Each games support contract shall require a qualified 6-26 applicant to repay the state any funds expended by the department 6-27 under this Act from any surplus of the qualified applicant's funds 7-1 remaining after the presentation of the games and after the payment 7-2 of the expenses and obligations incurred by a qualified applicant. 7-3 If the games are not awarded to a qualified applicant, the 7-4 qualified applicant is not required to repay any state money 7-5 expended by the department under this Act before the site selection 7-6 date. 7-7 (g) A games support contract may contain any additional 7-8 provisions the department requires in order to carry out the 7-9 purposes of this Act. 7-10 (h) The Texas Department of Transportation, the Texas 7-11 Department of Public Safety, and the Texas Department of Housing 7-12 and Community Affairs may: 7-13 (1) assist a qualified applicant in developing 7-14 applications and planning for the games; and 7-15 (2) enter into contracts, agreements, or assurances 7-16 related to the presentation of the games. 7-17 SECTION 6. REGIONAL GAMES SUPPORT AUTHORITY. (a) A 7-18 regional games support authority may be created by a resolution 7-19 concurrently adopted by an endorsing municipality and one or more 7-20 counties. A regional games support authority is a political 7-21 subdivision and a governmental instrumentality of the state. 7-22 (b) The territory of a regional games support authority is 7-23 the same as the territory of the county or counties that 7-24 participate in the creation of the authority. 7-25 (c) A resolution creating a regional games support authority 7-26 must provide for the administration, operation, and governance of 7-27 the authority. A participating municipality or county may be 8-1 granted representation on the board of directors of the authority 8-2 in the resolution creating the authority. 8-3 SECTION 7. POWERS OF PARTICIPATING MUNICIPALITY OR COUNTY 8-4 AND REGIONAL GAMES SUPPORT AUTHORITY. (a) A participating 8-5 municipality or county and a regional games support authority have 8-6 all powers necessary and appropriate to construct, improve, expand, 8-7 and acquire any and all sports venues that are found to be useful 8-8 in the presentation of the games, together with any and all public 8-9 infrastructure, housing, and other facilities that are incident to 8-10 or useful in connection with the presentation of the games, 8-11 including the power to enter into a contract or agreement with a 8-12 qualified applicant. 8-13 (b) A participating municipality or county, regional games 8-14 support authority, and any other political subdivision or local 8-15 governmental entity may enter into an interlocal contract with 8-16 another public entity or into any other agreement with a private or 8-17 public party, including a qualified applicant, regarding the use, 8-18 financing, and improvement of sports venues, housing, and other 8-19 public infrastructure that may be useful in the presentation of the 8-20 games, including the method of allocating and sharing revenues and 8-21 income resulting from the presentation of the games or associated 8-22 events. 8-23 (c) To the extent authorized by a qualified applicant, a 8-24 participating municipality or county or regional games support 8-25 authority may design, obtain, and register sale and use trademarks, 8-26 copyrights, and other intellectual property rights relating to the 8-27 games and may sell, market, advertise, or license the intellectual 9-1 property rights, including the direct manufacture and sale of 9-2 products by a participating municipality or county or a regional 9-3 games support authority. 9-4 (d) A participating municipality or county or a regional 9-5 games support authority may enter into a contract, sue and be sued, 9-6 and condemn property and land in connection with the games. 9-7 SECTION 8. BONDS. (a) A participating municipality or 9-8 county may issue bonds, notes, and other securities determined 9-9 appropriate to: 9-10 (1) construct new venues for the games; 9-11 (2) repair, expand, or improve existing sports venues 9-12 for use as venues for the games; or 9-13 (3) provide other facilities and public infrastructure 9-14 appropriate for the conduct of the games, including housing 9-15 facilities. 9-16 (b) The issuer of obligations authorized under Subsection 9-17 (a) of this section may pledge to the payment of those obligations: 9-18 (1) revenues to be received by the issuer under an 9-19 agreement with a qualified applicant; and 9-20 (2) revenues, taxes, and other sources of income 9-21 authorized by any other law, subject to any election requirements 9-22 imposed by that law. 9-23 (c) A bond, note, or other security issued under this 9-24 section may be issued in the same manner as a participating 9-25 municipality or county may issue any other type of bond, note, or 9-26 other security. 9-27 (d) An obligation issued under Subsection (a) of this 10-1 section may be conditioned on payment of the first proceeds to an 10-2 issuer under an agreement with a qualified applicant. 10-3 (e) An obligation issued under Subsection (a) of this 10-4 section shall be paid before any other obligation incurred by the 10-5 issuer of that obligation under this Act. 10-6 SECTION 9. APPLICATION OF ETHICS RULES. (a) Each endorsing 10-7 municipality, participating municipality or county, qualified 10-8 applicant, and regional games support authority shall adopt a set 10-9 of ethical regulations for the operation of that endorsing 10-10 municipality, participating municipality or county, qualified 10-11 applicant, or regional games support authority and its officers and 10-12 employees in connection with the bid of an endorsing municipality 10-13 for selection as the site of the 2007 Pan American Games, the 10-14 conduct of the 2007 Pan American Games, or any other action taken 10-15 or activity conducted under this Act. 10-16 (b) Regulations adopted under this section must be at least 10-17 as stringent as the more stringent of: 10-18 (1) the ethics regulations of the United States 10-19 Olympic Committee or the Pan American Sports Organization; or 10-20 (2) the ethics laws of this state relating to the 10-21 spending restriction on lobbyists and prohibited activities of 10-22 state employees, including Chapters 305 and 572, Government Code. 10-23 (c) Each endorsing municipality, participating municipality 10-24 or county, qualified applicant, and regional games support 10-25 authority shall report to the Texas Ethics Commission quarterly on 10-26 the compliance of that endorsing municipality, participating 10-27 municipality or county, qualified applicant, or regional games 11-1 support authority and its officers and employees with the ethical 11-2 regulations adopted under Subsection (a) of this section. The Texas 11-3 Ethics Commission shall adopt rules relating to the manner of 11-4 reporting. 11-5 (d) A person commits an offense if the person fails to 11-6 comply with any ethical regulation adopted under Subsection (a) of 11-7 this section or fails to comply with any Texas Ethics Commission 11-8 rule adopted under this section. An offense under this subsection 11-9 is a Class A misdemeanor. 11-10 SECTION 10. EMERGENCY. The importance of this legislation 11-11 and the crowded condition of the calendars in both houses create an 11-12 emergency and an imperative public necessity that the 11-13 constitutional rule requiring bills to be read on three several 11-14 days in each house be suspended, and this rule is hereby suspended, 11-15 and that this Act take effect and be in force from and after its 11-16 passage, and it is so enacted.