78R2214 ESH-D

By:  Gallego                                                      H.B. No. 1569



A BILL TO BE ENTITLED

AN ACT

relating to the composition of the permanent school fund and the 
available school fund and to transfers from the permanent school 
fund to the available school fund.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 43.001(a) and (b), Education Code, are 
amended to read as follows:
	(a)  Except as provided by Subsection (b), the [The] 
permanent school fund, which is a perpetual endowment for the 
public schools of this state, consists of:
		(1)  all land appropriated for the public schools by 
the constitution and laws of this state;
		(2)  all of the unappropriated public domain remaining 
in this state, including all land recovered by the state by suit or 
otherwise except pine forest land as defined by Section 88.111;
		(3)  all proceeds from the authorized sale of permanent 
school fund land;   
		(4)  all proceeds from the lawful sale of any other 
properties belonging to the permanent school fund;
		(5)  all investments authorized by Section 43.003 of 
properties belonging to the permanent school fund; and
		(6)  all income from the mineral development of 
permanent school fund land, including income from mineral 
development of riverbeds and other submerged land.
	(b)  The available school fund, which shall be apportioned 
annually to each county according to its scholastic population, 
consists of:
		(1)  the distributions to the fund from the permanent 
school fund as provided by Section 5(a), Article VII, Texas 
Constitution [interest and dividends arising from any securities or 
funds belonging to the permanent school fund];
		(2)  [all interest derivable from the proceeds of the 
sale of land set apart for the permanent school fund;
		[(3)  all money derived from the lease of land 
belonging to the permanent school fund;
		[(4)]  one-fourth of all revenue derived from all state 
occupation taxes, exclusive of delinquencies and cost of 
collection;
		(3) [(5)]  one-fourth of revenue derived from state 
gasoline and special fuels excise taxes as provided by law; and
		(4) [(6)]  all other appropriations to the available 
school fund made by the legislature for public school purposes.
	SECTION 2.   Section 43.002, Education Code, is amended to 
read as follows:  
	Sec. 43.002.  TRANSFERS FROM PERMANENT SCHOOL FUND AND
GENERAL REVENUE FUND TO AVAILABLE SCHOOL FUND. (a)  On the first 
working day of each month in a state fiscal year, the comptroller 
shall transfer from the permanent school fund to the available 
school fund an amount equal to one-twelfth of the annual 
distribution from the permanent school fund to the available school 
fund as determined by the comptroller under Section 5(a), Article 
VII, Texas Constitution, for the fiscal year.
	(b)  Of the amounts available for transfer from the general 
revenue fund to the available school fund for the months of January 
and February of each fiscal year, no more than the amount necessary 
to enable the comptroller to distribute from the available school 
fund an amount equal to 9-1/2 percent of the estimated annual 
available school fund apportionment to category 1 school districts, 
as defined by Section 42.259, and 3-1/2 percent of the estimated 
annual available school fund apportionment to category 2 school 
districts, as defined by Section 42.259, may be transferred from 
the general revenue fund to the available school fund.  Any 
remaining amount that would otherwise be available for transfer for 
the months of January and February shall be transferred from the 
general revenue fund to the available school fund in equal amounts 
in June and in August of the same fiscal year.
	SECTION 3.   Section 43.008, Education Code, is repealed.                      
	SECTION 4.   This Act takes effect September 1, 2004, but 
only if the constitutional amendment proposed by the 78th 
Legislature, Regular Session, 2003, relating to the use of income 
and appreciation of the permanent school fund, is approved by the 
voters.  If the proposed constitutional amendment is not approved 
by the voters, this Act has no effect.