SRC-JBJ S.B. 346 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 346
77R1881 DAK-FBy: Bivins
Jurisprudence
3/29/2001
As Filed


DIGEST AND PURPOSE 

Under current Texas law, the postjudgment interest rate is set at the
treasury bill rate, with a floor of 10 percent and a ceiling of 20 percent.
The treasury bill rate, however, is rarely above the 10 percent floor
requiring the creation of an artificially high rate for the interest
calculation on judgment resulting in a rate that would, otherwise, not be
available to any lender, borrower, or investor.  As proposed, S.B. 346
amends provisions regarding the determination of a  postjudgment interest
rate. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 304.003(c), Finance Code, to provide that the
postjudgment interest rate is a percentage equal to the sum of certain
specific figures, including two percentage points. Deletes existing text
pertaining to percentage points included in certain circumstances.  Makes a
nonsubstantive change. 

SECTION 2.  Amends Chapter 304B, Finance Code, by adding Section 304.1045,
as follows: 

Sec. 304.1045.  FUTURE DAMAGES.  Prohibits prejudgment interest from being
assessed or recovered on an award of future damages. 

SECTION 3.  Effective date: September 1, 2001.

SECTION 4.  Makes application of this Act prospective.