1-1     By:  Junell (Senate Sponsor - Ellis)                  H.B. No. 2190
 1-2           (In the Senate - Received from the House May 3, 2001;
 1-3     May 4, 2001, read first time and referred to Committee on Finance;
 1-4     May 9, 2001, reported favorably by the following vote:  Yeas 12,
 1-5     Nays 0; May 9, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to the establishment of debt issuance policies and
 1-9     guidelines by the Bond Review Board.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Subchapter B, Chapter 1231, Government Code, is
1-12     amended by adding Section 1231.023 to read as follows:
1-13           Sec. 1231.023.  DEBT ISSUANCE POLICIES AND GUIDELINES.  (a)
1-14     The board shall adopt debt issuance policies to guide issuers of
1-15     state securities and to ensure that state debt is prudently
1-16     managed.  The policies must be sufficiently flexible to allow the
1-17     state and issuers of state securities to respond to changing
1-18     economic conditions.
1-19           (b)  The board shall consult with issuers of state securities
1-20     in developing the policies.
1-21           (c)  The board shall adopt policies that:
1-22                 (1)  provide a mechanism for evaluating the amount of
1-23     state debt that can be managed prudently;
1-24                 (2)  address opportunities to consolidate debt
1-25     authority;
1-26                 (3)  include guidelines for:
1-27                       (A)  appropriate levels of reserves;
1-28                       (B)  the types of state security that should be
1-29     issued under various circumstances; and
1-30                       (C)  the terms or structure of a state security;
1-31                 (4)  help the board and issuers of state securities to
1-32     evaluate:
1-33                       (A)  the potential risks involved in the issuance
1-34     of a state security; and
1-35                       (B)  the effect that the issuance of a state
1-36     security will have on the finances and on the overall debt position
1-37     of the issuer and of the state; and
1-38                 (5)  recommend other advisable practices related to the
1-39     issuance of a state security.
1-40           SECTION 2.  This Act takes effect immediately if it receives
1-41     a vote of two-thirds of all the members elected to each house, as
1-42     provided by Section 39, Article III, Texas Constitution.  If this
1-43     Act does not receive the vote necessary for immediate effect, this
1-44     Act takes effect September 1, 2001.
1-45                                  * * * * *