SRC-CTC H.B. 3589 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 3589
77R9936 DLF-FBy: Hunter (Armbrister)
Business & Commerce
5/9/2001
Engrossed


DIGEST AND PURPOSE 

In 1999, the legislature established the Texas Film Industry Development
Loan Guarantee Program and the Texas Film Industry Administrative Fund to
assist film makers in borrowing money to make films. The application for a
loan guarantee requires a film producer to provide to the comptroller an
indemnity against loss that equals the amount guaranteed by the state.  The
indemnity must be issued by a Texas-licensed insurance company, surety
company, or financial institution.  H.B. 3589 adds a surplus lines
insurance company to this list, and sets forth provisions regarding a loan
guarantee.  

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the comptroller in SECTION 3
(Section 403.332, Government Code) of this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 403.327, Government Code, to require the
indemnity to be issued to the comptroller as the beneficiary of the
indemnity by an eligible surplus lines insurer that meets certain
requirements and rules and is approved by the comptroller. 

SECTION 2.  Amends Section 403.329, Government Code, to authorize the
comptroller to require the payment of a guarantee fee for approval of the
issuance of a loan guarantee and to set the fee in an amount sufficient to
fund the administration of the program. 

SECTION 3.  Amends Section 403.332, Government Code, to authorize the
comptroller, subject to the limit established under this section, to
approve loan guarantees in an amount that exceeds the amount available in
the Texas film industry administrative fund established under Section
403.323. Prohibits loan guarantees approved by the comptroller from
exceeding the guarantee-to-reserve ratio established by the comptroller
under this section.  Authorizes the comptroller by rule to adopt a
guarantee-to-reserve ratio that determines the amount of loan guarantees
that may be made that exceed the amount available in the fund.  Prohibits
the ratio of guarantees to the amount of money available in the fund from
exceeding five to one.  Requires the comptroller to review the
guarantee-to-reserve ratio annually and adjust the ratio as appropriate,
considering the payment experience of the loans. 

SECTION 4.  Effective date: September 1, 2001.