HBA-MPM S.J.R. 10 77(R) BILL ANALYSIS Office of House Bill AnalysisS.J.R. 10 By: Lucio Transportation 4/19/2001 Engrossed BACKGROUND AND PURPOSE The federal National Highway System Designation Act of 1995 and the federal Transportation Equity Act for the 21st Century authorized the use of Grant Anticipation Revenue Vehicle (GARVEE) bonds to finance highway projects. GARVEE bonds may be issued by the state and are guaranteed by future federal reimbursements. The bonds are backed by state funds, usually state gas tax revenues, if federal funds are insufficient to repay the state's obligations. Allowing the Texas Transportation Commission to utilize GARVEE bonds as a financing option may speed delivery of new construction projects. Senate Joint Resolution 10 requires the submission to the voters of a constitutional amendment authorizing the legislature to use GARVEE bonds to fund highway projects. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS Senate Joint Resolution 10 amends the Texas Constitution to authorize the legislature for the funding of improvements to the state highway system to authorize the Texas Transportation Commission to issue bonds and enter into bond enhancement agreements that are payable from revenue received or to be received from the federal highway trust fund and other revenue in the state highway fund. The resolution specifies the manner in which expenditures for the principal and interest on the bonds and other related costs are appropriated from the federal highway trust fund. The resolution requires the Texas Transportation Commission before each issuance of bonds to determine the 10-year historic average expenditure ratio of nonfederal aid projects to federal aid projects and certify to the governor and Legislative Budget Board that the ratio will not be reduced as a result of the proposed issuance. EFFECTIVE DATE This proposed constitutional amendment shall be submitted to the voters at an election to be held November 6, 2001.