77R12274 E                          
         By Lindsay                                             S.B. No. 354
         Substitute the following for S.B. No. 354:
         By Alexander                                       C.S.S.B. No. 354
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the powers of a local government corporation.
 1-4           SECTION 1.  Section 431.101, Transportation Code, is amended
 1-5     by amending Subsection (e) and adding Subsections (g)-(k) to read
 1-6     as follows:
 1-7           (e)  Except as provided by Subsections (g), (h), and (i), a
 1-8     local government corporation is subject to all state law related to
 1-9     the design and construction of projects, including the procurement
1-10     of design and construction services, that applies to the local
1-11     government that created the corporation.  If a local government
1-12     corporation is created jointly by more than one local government
1-13     and the local governments have different threshold contract amounts
1-14     at which competitive bidding is required, the lowest amount applies
1-15     to the corporation [Section 394.904(a), Local Government Code,
1-16     applies to property and improvements owned by a local government
1-17     corporation.  Section 394.904(b) of that code applies to each
1-18     contract awarded by the local government corporation].
1-19           (g)  A corporation created by a municipality for the purpose
1-20     of developing a convention center hotel project is exempt from
1-21     competitive bidding requirements and other restrictions on the
1-22     award of contracts, except as provided by Subsection (j).
1-23           (h)  A corporation created by a municipality after September
1-24     1, 1999, for the purpose of developing water treatment and
 2-1     distribution facilities is exempt from competitive bidding
 2-2     requirements and other restrictions on the award of contracts for
 2-3     the limited purpose of completing projects as described in a
 2-4     project definition document issued before December 31, 2000.  Any
 2-5     expansion of treatment facilities beyond the project described in
 2-6     the project definition document is exempt from the competitive
 2-7     bidding requirements except as provided by Subsection (j).  Any
 2-8     expansion of distribution facilities by the corporation is subject
 2-9     to all state law that applies to the local government that created
2-10     the corporation, as provided in Subsection (e).
2-11           (i)  A local government corporation created for the primary
2-12     purpose of assisting a municipality in implementing a project plan
2-13     of a tax increment reinvestment zone created by the municipality
2-14     pursuant to Chapter 311, Tax Code, is exempt from competitive
2-15     bidding requirements and other restrictions on the award of
2-16     contracts, except as provided by Subsection (j). Section
2-17     394.904(a), Local Government Code, applies to property and
2-18     improvements owned by the corporation and Section 394.904(b), Local
2-19     Government Code, applies to each contract awarded by the
2-20     corporation.
2-21           (j)  A local government corporation shall comply with Chapter
2-22     2254, Government Code.
2-23           (k)  Any competitive bidding requirement or restriction
2-24     imposed on the procedure regarding the lease, sale, or other
2-25     disposition of property does not apply to a transaction related to
2-26     the transfer of water rights by a local government corporation.
2-27           SECTION 2. Subchapter D, Chapter 431, Transportation Code, is
 3-1     amended by adding Sections 431.110 and 431.111 to read as follows:
 3-2           Sec. 431.110.  CONFLICT OF INTEREST IN CONTRACT. Chapter 171,
 3-3     Local Government Code, applies to the award of a contract by a
 3-4     local government corporation.
 3-5           Sec. 431.111.  ANNUAL REPORT TO COMPTROLLER. (a)  Not later
 3-6     than February 1 of each year, the board of a local government
 3-7     corporation shall submit to the comptroller a report in the form
 3-8     required by the comptroller.  The form for the report may not
 3-9     exceed one page in length.
3-10           (b)  The report must include:
3-11                 (1)  a statement of the corporation's purpose;
3-12                 (2)  a statement of the corporation's total revenues
3-13     and expenditures during the preceding fiscal year; and
3-14                 (3)  a summary of the corporation's activities during
3-15     the preceding fiscal year, including any bonds issued and capital
3-16     projects undertaken.
3-17           (c)  The board shall submit a copy of the report to the local
3-18     government that created the corporation.
3-19           SECTION 3. Except as provided by Sections 431.101(g), (h),
3-20     and (i), Transportation Code, as added by this Act, the change in
3-21     law made by this Act to Section 431.101(e), Transportation Code,
3-22     applies to all contracts entered into by a local government
3-23     corporation on or after the effective date of this Act.  A contract
3-24     entered into before the effective date of this Act is governed by
3-25     that section as it existed immediately before the effective date of
3-26     this Act, and the former law is continued in effect for that
3-27     purpose.
 4-1           SECTION 4.  This Act takes effect immediately if it receives
 4-2     a vote of two-thirds of all the members elected to each house, as
 4-3     provided by Section 39, Article III, Texas Constitution.  If this
 4-4     Act does not receive the vote necessary for immediate effect, this
 4-5     Act takes effect September 1, 2001.