C.S.H.B. 2528 78(R)    BILL ANALYSIS


C.S.H.B. 2528
By: Madden
Public Education
Committee Report (Substituted)



BACKGROUND 

When the electric utility restructuring bill was enacted into law in 1999,
the bill contained a provision allowing a local government to join with
other local governments to form a political subdivision corporation in
order to purchase electricity at a substantial savings to the school
district. 
As school districts began looking at the different options available to
purchase electricity in the new restructured electricity market, it was
questioned whether school districts were able to participate in a
political subdivision corporation created to purchase electricity. In
2002, the attorney general held that the Education Code does not
explicitly list political subdivision corporations established under
Section 304.001, Local Government Code, as a method for school districts
to procure contracts valued at $25,000 or more for the purchase of
electricity, and thus school districts are prohibited from participating.


PURPOSE

C.S.H.B. 2528 amends the Education Code to include political subdivision
corporations as an additional method for school districts to receive the
best value on contracts valued at $25,000 or more. 


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant  any
additional rulemaking authority to a state officer, department, agency or
institution. 


ANALYSIS

C.S.H.B. 2528 amends Education Code, by providing that the formation of a
political subdivision corporation under Section 304.001, Local Government
Code, is an additional method for school districts contracts valued at
$25,000 or more in the aggregate for each 12-month period that provides
the best value for the district. The bill amends the Local Government
Code, to include a school district in the definition of political
subdivision. 


EFFECTIVE DATE

Upon passage, or, if the Act does not receive the necessary vote, the Act
takes effect September 1, 2003. 


COMPARISON OF ORIGINAL TO SUBSTITUTE
 
C.S.H.B. 2528 modifies the original by amending Section 44.031(a)(10)
rather than adding Section 44.031(n), Education Code.