By:  Gallegos                                         S.B. No. 1325
                                A BILL TO BE ENTITLED
                                       AN ACT
 1-1     relating to school district purchasing and bonds.
 1-2           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-3           SECTION 1.  Section 44.031, Education Code, is amended by
 1-4     amending Subsections (f) and (h) and adding Subsection (m) to read
 1-5     as follows:
 1-6           (f)  This section does not apply to a contract [fees
 1-7     received] for professional services rendered, including services of
 1-8     an architect, attorney, or fiscal agent.  A school district may, at
 1-9     its option, contract for professional services rendered by a
1-10     financial consultant or a technology consultant in the manner
1-11     provided by Section 2254.003, Government Code, in lieu of the
1-12     methods provided by this section [architect's fees, attorney's
1-13     fees, and fees for fiscal agents].
1-14           (h)  If school equipment or all or part of a school facility
1-15     is destroyed, [or] severely damaged, or undergoes a major
1-16     unforeseen operational or structural failure, and the board of
1-17     trustees determines that the delay posed by the contracting methods
1-18     required by this section [competitive bidding process] would
1-19     prevent or substantially impair the conduct of classes or other
1-20     essential school activities, then contracts for the replacement or
1-21     repair of the equipment or all or part of the school facility may
1-22     be made by a method other than the methods [without competitive
1-23     bidding as otherwise] required by this section.
1-24           (m)  If a purchase is made at the campus level in a school
 2-1     district with an average daily attendance of 190,000 or more as
 2-2     determined under Section 42.005, that has formally adopted a
 2-3     site-based decision-making plan under Subchapter F, Chapter 11,
 2-4     that delegates purchasing decisions to the campus level, this
 2-5     section applies only to the campus and does not require the
 2-6     district to aggregate and jointly award purchasing contracts.
 2-7           SECTION 2.  Section 44.033, Education Code, is amended by
 2-8     adding Subsection (e) to read as follows:
 2-9           (e)  If a purchase is made at the campus level in a school
2-10     district with an average daily attendance of 190,000 or more as
2-11     determined under Section 42.005, that has formally adopted a
2-12     site-based decision-making plan under Subchapter F, Chapter 11,
2-13     that delegates purchasing decisions to the campus level, this
2-14     section applies only to the campus and does not require the
2-15     district to aggregate and jointly award purchasing contracts.
2-16           SECTION 3.  Subdivision (1), Section 1, Chapter 656, Acts of
2-17     the 68th Legislature, Regular Session, 1983 (Article 717q, Vernon's
2-18     Texas Civil Statutes), is amended to read as follows:
2-19                 (1)  "Issuer" means (A) any incorporated city operating
2-20     under a home-rule charter adopted pursuant to Article XI, Section
2-21     5, of the Constitution of Texas having a population according to
2-22     the latest federal decennial census of 90,000 or more and having
2-23     outstanding long-term debt secured by the revenues of the public
2-24     utility for which the obligations are being issued which is rated
2-25     by a nationally recognized rating agency for municipal securities
2-26     in one of the four highest rating categories for long-term
 3-1     obligations; (B) any conservation and reclamation district created
 3-2     and organized as a river authority under and pursuant to Article
 3-3     III, Section 52, or Article XVI, Section 59, of the Constitution of
 3-4     Texas and by an act of the legislature of the State of Texas; (C)
 3-5     any joint powers agency organized and operating pursuant to Chapter
 3-6     163, Utilities Code [166, Acts of the 63rd Legislature, Regular
 3-7     Session, 1973 (Article 1435a, Revised Statutes)]; (D) any
 3-8     metropolitan rapid transit authority or regional transportation
 3-9     authority created, organized, and operating pursuant to Chapter 451
3-10     or 452, Transportation Code [141, Acts of the 63rd Legislature,
3-11     Regular Session, 1973 (Article 1118x, Revised Statutes) or Chapter
3-12     683, Acts of the 66th Legislature, Regular Session, 1979 (Article
3-13     1118y, Revised Statutes)]; (E) any conservation and reclamation
3-14     district organized or operating as a navigation district under and
3-15     pursuant to Article III, Section 52, or Article XVI, Section 59, of
3-16     the Constitution of Texas; (F) any district organized or operating
3-17     under and pursuant to Article XVI, Section 59, of the Constitution
3-18     of Texas which has all or part of two or more incorporated cities
3-19     within its boundaries; (G) agencies of the State of Texas
3-20     (including the governing boards of the state institutions of higher
3-21     education); (H) any hospital authority in a county with a
3-22     population of more than 2 million, according to the most recent
3-23     federal census, or any hospital authority in a county that is
3-24     included, in whole or in part, in a standard metropolitan
3-25     statistical area of this state that includes a county with a
3-26     population of more than 1,800,000, that was created or is operating
 4-1     under Chapter 262, Health and Safety Code, or Chapter 264, Health
 4-2     and Safety Code; (I) any nonprofit corporation organized to
 4-3     exercise the powers of a higher education authority under
 4-4     Subsection (e), Section 53.47, Education Code; [and] (J) a county
 4-5     having a population of 2 million or more according to the most
 4-6     recent federal census; and (K) an independent school district that
 4-7     has an average daily attendance of 190,000 or more as determined
 4-8     under section 42.005, Education Code.
 4-9           SECTION 4.  Section 3.028, Article 717s, Revised Statutes, is
4-10     amended by adding Subsection (g) to read as follows:
4-11           (g)  A member of a corporation's board of directors who is
4-12     acting in good faith and in the course and scope of corporate
4-13     duties or functions has the same immunity from liability as state
4-14     law provides to a member of the governing body of the sponsor.
4-15           SECTION 5.  Section 1, Article 717w, Revised Statutes, is
4-16     amended by amending Subdivisions (6) and (7) and adding Subdivision
4-17     (8) to read as follows:
4-18                 (6)  "Eligible school district" means an independent
4-19     school district that has an average daily attendance of 190,000 or
4-20     more as determined under Section 42.005, Education Code.
4-21                 (7)  "Governing body" means the board, council,
4-22     commission, court, or other body or group authorized to issue
4-23     anticipation notes for or on behalf of an issuer.
4-24                 (8) [(7)]  "Issuer" means a municipality, [or] county,
4-25     or eligible school district.
4-26           SECTION 6.  Section 3, Article 717w, Revised Statutes, is
 5-1     amended to read as follows:
 5-2           Sec. 3.  Purposes for which anticipation notes may be
 5-3     authorized.  (a)  The commissioners court of a county, on
 5-4     recommendation of the county auditor or budget officer if
 5-5     applicable, or the governing body of a municipality may authorize
 5-6     anticipation notes to:
 5-7                 (1)  pay a contractual obligation incurred or to be
 5-8     incurred for the construction of any public work;
 5-9                 (2)  pay a contractual obligation incurred or to be
5-10     incurred for the purchase of materials, supplies, equipment,
5-11     machinery, buildings, lands, and rights-of-way for an issuer's
5-12     authorized needs and purposes;
5-13                 (3)  pay a contractual obligation incurred or to be
5-14     incurred for professional services, including services provided by
5-15     tax appraisal engineers, engineers, architects, attorneys,
5-16     mapmakers, auditors, financial advisors, and fiscal agents;
5-17                 (4)  pay operating expenses or current expenses; or
5-18                 (5)  fund the issuer's cumulative cash flow deficit.
5-19           (b)  The governing body of an eligible school district may
5-20     authorize anticipation notes for a purpose described by Subsection
5-21     (a)(2), (3), (4), or (5) of this section.
5-22           SECTION 7.  Subsection (a), Section 4, Article 717w, Revised
5-23     Statutes, is amended to read as follows:
5-24           (a)  This section applies only to:
5-25                 (1)  a county; [or]
5-26                 (2)  a municipality that has a population of 80,000 or
 6-1     more, according to the most recent federal census; or
 6-2                 (3)  an eligible school district.
 6-3           SECTION 8.  Section 5, Article 717w, Revised Statutes, is
 6-4     amended to read as follows:
 6-5           Sec. 5.  Authorization of anticipation notes by ordinance or
 6-6     order.  Anticipation notes may be authorized by an ordinance
 6-7     adopted by the governing body of a municipality or by an order
 6-8     adopted by the governing body of a county or an eligible school
 6-9     district.
6-10           SECTION 9.  Subsections (e), (f), (g), and (h), Section 6,
6-11     Article 717w, Revised Statutes, are amended to read as follows:
6-12           (e)  Anticipation notes issued for a purpose described by
6-13     Section 3(a)(1), (2), or (3) [Subdivision (1), (2), or (3) of
6-14     Section 3] of this article must mature before the seventh
6-15     anniversary of the date that the attorney general approves the
6-16     notes.
6-17           (f)  Anticipation notes issued for a purpose described in
6-18     Section 3(a)(4) or (5) [Subdivision (4) or (5) of Section 3] of
6-19     this article must mature before the first anniversary of the date
6-20     that the attorney general approves the notes.
6-21           (g)  Anticipation notes issued by a municipality under
6-22     Section 3(a)(4) [Subdivision (4) of Section 3] of this article may
6-23     not exceed 75 percent of the revenues or taxes anticipated to be
6-24     collected in the fiscal year in which the attorney general approves
6-25     the notes.  Anticipation notes issued by a county under Section
6-26     3(a)(4) [Subdivision (4) of Section 3] of this article may not
 7-1     exceed 50 percent of the revenues or taxes anticipated to be
 7-2     collected in the fiscal year in which the attorney general approves
 7-3     the notes.  Anticipation notes issued by an eligible school
 7-4     district under Section 3(a)(4) of this article may not exceed 75
 7-5     percent of the income of the district for the fiscal year preceding
 7-6     the fiscal year in which the attorney general approves the notes.
 7-7           (h)  A county must comply with the competitive bidding
 7-8     requirements of Subchapter C, Chapter 271, Local Government Code,
 7-9     in connection with a contract to be paid from the proceeds of
7-10     anticipation notes issued for a purpose described by Section
7-11     3(a)(1) [3(1)] of this article.
7-12           SECTION 10.  Subsection (f), Section 44.031, Education Code,
7-13     as amended by this Act, applies only to a contract for professional
7-14     services a school district entered into on or after the effective
7-15     date of this Act.  A contract for professional services a school
7-16     district entered into before the effective date of this Act is
7-17     governed by the law in effect on the date the contract was entered
7-18     into, and that law is continued in effect for that purpose.
7-19           SECTION 11.  Subsection (m), Section 44.031, and Subsection
7-20     (e), Section 44.033, Education Code, as added by this Act, apply
7-21     only to a contract a public school enters into on or after the
7-22     effective date of this Act.  A contract a public school entered
7-23     into before the effective date of this Act is governed by the law
7-24     in effect on the date the contract was entered into, and that law
7-25     is continued in effect for that purpose.
7-26           SECTION 12.  Subsection (g), Section 3.028, Article 717s,
 8-1     Revised Statutes, as added by this Act, applies to an act or
 8-2     omission of a public facility corporation or a director, officer,
 8-3     or employee of a public facility corporation regardless of when the
 8-4     act was taken or the omission occurred.
 8-5           SECTION 13.  This Act takes effect September 1, 1999.
 8-6           SECTION 14.  The importance of this legislation and the
 8-7     crowded condition of the calendars in both houses create an
 8-8     emergency and an imperative public necessity that the
 8-9     constitutional rule requiring bills to be read on three several
8-10     days in each house be suspended, and this rule is hereby suspended.