By:  Shapleigh                                                    S.B. No. 654

A BILL TO BE ENTITLED
AN ACT
relating to access to capital and other funds by individuals and new businesses in this state. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Subtitle Z, Title 3, Finance Code, is amended by adding Chapter 278 to read as follows:
CHAPTER 278. ACCESS TO FINANCIAL CAPITAL
Sec. 278.001. DUTY OF CERTAIN AGENCIES TO PREPARE STRATEGIC PLAN CONCERNING ACCESS TO FINANCIAL CAPITAL. The Finance Commission of Texas, the Texas Department of Economic Development, and the Texas Department of Housing and Community Affairs shall jointly prepare a biennial strategic plan relating to access to capital in unserved and underserved areas of the state. Sec. 278.002. SUBMISSION OF PLAN AND RECOMMENDATIONS. Not later than November 1 of each even-numbered year, the agencies shall jointly: (1) submit the strategic plan required by this chapter to the lieutenant governor, the speaker of the house of representatives, and the presiding officers of the senate business and commerce and house business and industry committees; and (2) make recommendations on actions that the legislature may take to improve access to capital in unserved and underserved areas of the state. Sec. 278.003. CONTENTS OF PLAN. The strategic plan must: (1) define and identify unserved and underserved areas in the state with regard to housing ownership, small business loans, availability of venture capital, lending options, and other relevant financial capital issues; (2) quantify community investment and lending resources available by location in the state; (3) develop specific targets and plans for increasing investment in unserved and underserved areas; and (4) enlist private financial institutions to use the strategic plan to set institutional targets. Sec. 278.004. FINANCIAL CAPITAL INFORMATION AVAILABLE ON INTERNET. The agencies shall create and maintain an Internet site through the Texas Online government portal or any successor to that portal that includes: (1) a list of traditional and nontraditional sources for loans that can be searched by a borrower based on the borrower's financial characteristics; (2) advice to small businesses on how to develop a business plan; (3) advice on how to enhance credit scores; (4) advice on how to establish a relationship with a financial institution; (5) information on interest rates available in the state; (6) information on the cost of loans available to borrowers of varied risk levels in the state; (7) information on how to compare mortgage loans available in the state; (8) information regarding lending practices of specific lenders in the state; and (9) links to relevant consumer financial websites. Sec. 278.005. INTEGRATED BUDGET. The agencies shall work together to determine whether an integrated budget is appropriate and necessary for purposes of creating the strategic plan required by this chapter. If the agencies determine that an integrated budget is appropriate and necessary, the agencies shall present to the Legislative Budget Board recommendations concerning the distribution of funds to each of the agencies. SECTION 2. (a) Subtitle Z, Title 3, Finance Code, is amended by adding Chapter 279 to read as follows:
CHAPTER 279. COMMUNITY REINVESTMENT PLANS
Sec. 279.001. DEFINITIONS. In this chapter: (1) "Community development financial institution" has the meaning assigned by Section 103(5) of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. Section 4702), as amended. (2) "Community reinvestment plan" means an annual community reinvestment strategic plan developed and implemented by a lender under this chapter. (3) "Finance commission" means the Finance Commission of Texas. (4) "Underserved area" means an investment area as defined by Section 103(16), of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. Section 4702), as amended. Sec. 279.002. APPLICABILITY. This chapter applies only to a lender that is subject to a corporate franchise tax. Sec. 279.003. COMMUNITY REINVESTMENT STRATEGIC PLAN. A lender, in accordance with rules adopted by the finance commission under Section 279.005, may develop and implement an annual community reinvestment strategic plan in order to be eligible to receive a tax credit as provided by Section 279.004. A lender's plan must include the lender's specific targets for the expenditure of funds for community reinvestment purposes, including: (1) lending money to borrowers in underserved areas in the state; (2) investing in or with nonprofit lending institutions for lending activities in underserved areas in the state; and (3) investing in or with community development financial institutions. Sec. 279.004. TAX CREDIT. A lender must meet each of the targets set by the lender's community reinvestment plan, as certified by rule of the finance commission, in order to be eligible for a tax credit as provided by Subchapter V, Chapter 171, Tax Code. Sec. 279.005. DUTIES OF FINANCE COMMISSION; RULEMAKING AUTHORITY. (a) The finance commission, in consultation with the Texas Department of Economic Development and the Texas Department of Housing and Community Affairs, shall assist lenders in identifying and setting community reinvestment targets for the submission of community reinvestment plans. (b) The finance commission shall adopt policies and rules as necessary to implement this chapter, including policies and rules that: (1) provide lenders with specific guidelines and procedures for the adoption and submission to the commission of community reinvestment plans, including a reasonable time frame for implementation of the plan; and (2) create a certification process for lenders that meets each of the targets set under their respective plan. (c) The finance commission may consult with and request information relevant to this chapter from the Texas Department of Economic Development and the Texas Department of Housing and Community Affairs. In developing rules and policies under this section, the commission shall consider any information obtained under this subsection. Sec. 279.006. INTERNET POSTING. (a) A lender may post the lender's community reinvestment plan on any Internet website maintained by the lender. The plan must be posted in a format that is readily accessible to and understandable by a member of the public. The lender shall notify the finance commission if it posts a plan. (b) The finance commission shall maintain on the commission's Internet website a link to each lender's community reinvestment plan that is posted on the Internet. (b) Chapter 171, Tax Code, is amended by adding Subchapter V to read as follows:
SUBCHAPTER V. TAX CREDIT FOR ACHIEVING COMMUNITY REINVESTMENT TARGETS
Sec. 171.901. APPLICATION OF SUBCHAPTER. This subchapter applies only to a corporation that is certified by the Finance Commission of Texas as having met the targets of a community reinvestment plan submitted by the corporation under Chapter 279, Finance Code. Sec. 171.902. CREDIT. A corporation that meets the eligibility requirements under this subchapter is entitled to a credit in the amount allowed by this subchapter against the tax imposed under this chapter. Sec. 171.903. CREDIT FOR EXPENDITURE. A corporation may claim a credit under this subchapter only for a qualifying expenditure relating to the implementation of the corporation's community reinvestment plan. A qualifying expenditure includes an expenditure of funds described by Section 279.003, Finance Code. Sec. 171.904. LIMITATION. (a) The total credit claimed under this subchapter for a period may not exceed 15 percent of the amount of franchise tax due for the report after any other applicable tax credits. (b) A corporation may claim a credit under this subchapter for a contribution made during an accounting period only against the tax owed for the corresponding reporting period. Sec. 171.905. APPLICATION FOR CREDIT. (a) A corporation must apply for a credit under this subchapter on or with the tax report for the period for which the credit is claimed. (b) The comptroller shall adopt a form for the application for the credit. A corporation must use this form in applying for the credit. Sec. 171.906. ASSIGNMENT PROHIBITED. A corporation may not convey, assign, or transfer the credit allowed under this subchapter to another entity unless all of the assets of the corporation are conveyed, assigned, or transferred in the same transaction. (c) Subchapter V, Chapter 171, Tax Code, as added by this section, applies only to a report due on or after January 1, 2004. (d) A corporation may claim a credit under Subchapter V, Chapter 171, Tax Code, as added by this section, only for a qualified expenditure made on or after January 1, 2004. (e) Not later than November 1, 2003, the Finance Commission of Texas shall adopt rules under Chapter 279, Finance Code, as added by this section. SECTION 3. (a) Section 393.001, Finance Code, is amended by amending Subdivisions (1) and (3) and adding Subdivision (5) to read as follows: (1) "Consumer" means an individual who is solicited to purchase or who purchases the services, including debt-pooling services, of a credit services organization. (3) "Credit services organization" means a person who: (A) provides, or represents that the person can or will provide, for the payment of valuable consideration any of the following services with respect to the extension of consumer credit by others: (i) [(A)] improving a consumer's credit history or rating; (ii) [(B)] obtaining an extension of consumer credit for a consumer; or (iii) [(C)] providing advice or assistance to a consumer with regard to Subparagraph (i) or (ii); or (B) enters into a valid debt-pooling contract with a consumer under Subchapter B, Chapter 394 [Paragraph (A) or (B)]. (5) "Office" means the Office of Consumer Credit Commissioner. (b) Section 393.002, Finance Code, is amended by amending Subsection (a) and adding Subsection (c) to read as follows: (a) Except as provided by Subsection (c), this [This] chapter does not apply to: (1) a person: (A) authorized to make a loan or grant an extension of consumer credit under the laws of this state or the United States; and (B) subject to regulation and supervision by this state or the United States; (2) a lender approved by the United States secretary of housing and urban development for participation in a mortgage insurance program under the National Housing Act (12 U.S.C. Section 1701 et seq.); (3) a bank or savings association the deposits or accounts of which are eligible to be insured by the Federal Deposit Insurance Corporation or a subsidiary of the bank or association; (4) a credit union doing business in this state; (5) a nonprofit organization exempt from taxation under Section 501(c)(3), Internal Revenue Code of 1986 (26 U.S.C. Section 501(c)(3)); (6) a real estate broker or salesman licensed under The Real Estate License Act (Article 6573a, Vernon's Texas Civil Statutes) who is acting within the course and scope of that license; (7) an individual licensed to practice law in this state who is acting within the course and scope of the individual's practice as an attorney; (8) a broker-dealer registered with the Securities and Exchange Commission or the Commodity Futures Trading Commission acting within the course and scope of that regulation; (9) a consumer reporting agency; (10) a person whose primary business is making loans secured by liens on real property; or (11) a mortgage broker or loan officer licensed under Chapter 156 [, Finance Code,] who is acting within the course and scope of that license. (c) This chapter applies to any person, including a person listed in Subsection (a), who enters into a valid debt-pooling contract with a consumer under Subchapter B, Chapter 394. (c) Sections 393.101(a), (c), and (d), Finance Code, are amended to read as follows: (a) Before conducting business in this state, a credit services organization shall register with the office [secretary of state] by filing a statement that: (1) contains the name and address of: (A) the organization; and (B) each person who directly or indirectly owns or controls at least 10 percent of the outstanding shares of stock in the organization; and (2) fully discloses any litigation or unresolved complaint relating to the operation of the organization filed with a governmental authority of this state or contains a notarized statement that there has been no litigation or unresolved complaint of that type. (c) The office [secretary of state] may not require an organization to provide information other than information contained in the registration statement. (d) A registration certificate expires on the first anniversary of its date of issuance. A registered credit services organization may renew a registration certificate by filing a renewal application, in the form prescribed by the office [secretary of state], and paying the renewal fee. (d) Section 393.104, Finance Code, is amended to read as follows: Sec. 393.104. FILING FEE. The office [secretary of state] may charge a credit services organization a reasonable fee to cover the cost of filing a registration statement or renewal application in an amount not to exceed $100. (e) Section 393.401(b), Finance Code, is amended to read as follows: (b) A copy of the bond shall be filed with the office [secretary of state]. (f) Section 393.402(b), Finance Code, is amended to read as follows: (b) The name of the depository and the trustee and the account number of the surety account must be filed with the office [secretary of state]. (g) Section 393.407, Finance Code, is amended to read as follows: Sec. 393.407. PAYMENT OF MONEY IN SURETY ACCOUNT TO CREDIT SERVICES ORGANIZATION. (a) A depository may not pay money in a surety account to the credit services organization that established the account or a representative of the organization unless the organization or representative presents a statement issued by the office [secretary of state] indicating that the requirement of Section 393.406 has been satisfied in relation to the account. (b) The office [secretary of state] may conduct an investigation and require information to be submitted as necessary to enforce this section. (h) On September 1, 2003: (1) all functions and activities performed by the secretary of state that relate to the registration of credit services organizations under Chapter 393, Finance Code, immediately before that date are transferred to the Office of Consumer Credit Commissioner; (2) a rule or form adopted by the secretary of state that relates to the registration of credit services organizations under Chapter 393, Finance Code, is a rule or form of the Office of Consumer Credit Commissioner and remains in effect until altered by the Office of Consumer Credit Commissioner; (3) a reference in law to the secretary of state that relates to the registration of credit services organizations under Chapter 393, Finance Code, means the Office of Consumer Credit Commissioner; (4) a proceeding involving the secretary of state that relates to the registration of credit services organizations under Chapter 393, Finance Code, is transferred without change in status to the Office of Consumer Credit Commissioner, and the office assumes without a change in status the position of the secretary of state in a proceeding relating to the registration of credit services organizations to which the secretary of state is a party; (5) all money, contracts, leases, rights, and obligations of the secretary of state that relate to the registration of credit services organizations under Chapter 393, Finance Code, are transferred to the Office of Consumer Credit Commissioner; (6) all property, including records, in the custody of the secretary of state that relates to the registration of credit services organizations under Chapter 393, Finance Code, becomes property of the Office of Consumer Credit Commissioner; and (7) all funds appropriated by the legislature to the secretary of state that relate to the registration of credit services organizations under Chapter 393, Finance Code, are transferred to the Office of Consumer Credit Commissioner. (i) Money collected by the secretary of state for fees related to registration statements and renewal applications pending before the secretary of state on September 1, 2003, are transferred to the Office of Consumer Credit Commissioner on that date. The fees may not be assessed again for the same statement or application. SECTION 4. (a) Title 5, Finance Code, is amended by adding Chapter 397 to read as follows:
CHAPTER 397. DISCLOSURE OF INFORMATION TO CONSUMERS IN CERTAIN HOME LOAN CONTRACTS SUBCHAPTER A. GENERAL PROVISIONS
Sec. 397.001. DEFINITIONS. In this chapter: (1) "Consumer reporting agency" and "credit score" have the meanings assigned by Section 20.01, Business & Commerce Code. (2) "Enterprise" means the Federal National Mortgage Association or the Federal Home Loan Corporation or an affiliate of the association or corporation. (3) "Residential mortgage loan" means a loan, including a home equity loan, to or for the benefit of one or more individuals made primarily for personal, family, or household use and primarily secured by a mortgage on residential real property. (4) "Residential real property" means real property that consists of at least one but not more than four residential units.
[Sections 397.002-397.050 reserved for expansion]
SUBCHAPTER B. CREDIT SCORE DISCLOSURE
Sec. 397.051. APPLICABILITY OF SUBCHAPTER. This subchapter applies only to a person other than an enterprise who: (1) is engaged in the business of making or arranging a residential mortgage loan; and (2) uses a credit score in connection with an application initiated by a prospective borrower. Sec. 397.052. DISCLOSURE OF CREDIT SCORE AND OTHER INFORMATION. (a) As soon as reasonably practicable, a lender shall provide to a prospective borrower: (1) the borrower's credit score that the lender: (A) used or will use in determining whether to make the loan; or (B) obtained from a consumer reporting agency, regardless of whether the lender uses that score to make the loan; and (2) the following notice in type that is boldfaced, capitalized, underlined, or otherwise set out from surrounding material so as to be conspicuous:
NOTICE TO HOME LOAN APPLICANT
In connection with your application for a loan, the lender must disclose to you the credit score that a lender used or a credit bureau may have distributed to the lender for use in connection with your loan, and the key factors affecting your credit score, if any. The credit score is a summary computed at the time of the loan request and based on information a credit bureau or lender has on file regarding your credit history and payment patterns. A credit score is important because it is used by the lender to determine whether you will obtain a loan and may be used to determine what interest rate you may be offered on the loan. Because your credit score can change over time, it is very important that you review the credit-related information that is being furnished to you to make sure it is accurate. Your credit record may vary from one company to another. If you have a question regarding your credit score or other credit information that is furnished to you, you should contact the credit bureau at the address and telephone number provided with this notice, or contact the lender directly, if the lender developed the credit score. A credit bureau does not participate directly in the decision to make a loan and is not able to provide you with the specific reasons for the granting or denial of a loan. If you have a question regarding this disclosure statement or the terms of the loan, you should contact the lender. (b) The notice required by Subsection (a)(2) must include the name, address, and telephone number of each consumer reporting agency that submitted the customer's credit score that was used by the lender to comply with Subsection (a). (c) The lender shall disclose to a prospective borrower any numerical credit score that is generated by an automated underwriting system used by an enterprise if that score is disclosed to the lender. (d) A prospective borrower's credit score disclosed under Subsection (a)(1)(B) must include any key factors, not to exceed four, that may have adversely affected that credit score if the lender used another credit score in its determination to make the loan to the borrower or uses an automated underwriting system to underwrite the loan. For purposes of this subsection, "key factors" has the meaning assigned by Section 20.035, Business & Commerce Code. Sec. 397.053. EXEMPTION FROM DISCLOSURE REQUIREMENT. The lender is not required to provide the disclosure and other information required by this chapter if the prospective borrower has received the same information for that loan transaction from another person. Sec. 397.054. DUTY OF PROSPECTIVE BORROWER. At the time a loan transaction is initiated, a prospective borrower shall disclose to the lender, at the lender's request, whether the borrower has received or is in the process of receiving the disclosure and other information required by this chapter from a consumer reporting agency or another person. Sec. 397.055. DUTIES OF LENDER. A lender is not required to: (1) explain the information disclosed under Section 397.052(a)(1); (2) disclose a credit score or related information obtained by the lender after the date on which the loan is closed; or (3) provide more than one disclosure for each loan transaction. Sec. 397.056. LIABILITY OF LENDER. (a) A lender may not be held liable under this subchapter for: (1) the content of any information the lender obtains from a consumer reporting agency or any other person about a prospective borrower; or (2) the omission of any information from a credit file provided by a consumer reporting agency to the lender or a prospective borrower under this subchapter. (b) A lender may not be held liable under a contractual provision for disclosure of a credit score. Sec. 397.057. WAIVER PROHIBITED. A provision in a contract that prohibits a lender from disclosing a credit score as required by this subchapter is void. Sec. 397.058. VIOLATION OF SUBCHAPTER. A person who violates this subchapter commits an offense. An offense under this section is a Class C misdemeanor. (b) Section 20.01, Business & Commerce Code, is amended by adding Subdivision (5-1) to read as follows: (5-1) "Credit score" means a numerical value or category derived from a statistical measure or model used by a person who makes or arranges a loan to evaluate a prospective borrower's creditworthiness to predict the likelihood of negative performance under a contract for credit, including default. The term does not include: (A) a mortgage score or rating of an automated underwriting system in which a factor other than credit information, such as the loan-to-value ratio, the amount of a down payment, or a consumer's financial assets, is considered in computing the score or rating; or (B) another element of the underwriting process or decision. (c) The heading to Section 20.03, Business & Commerce Code, is amended to read as follows: Sec. 20.03. DISCLOSURE OF [DISCLOSURES TO] CONSUMER FILE. (d) Section 20.03, Business & Commerce Code, is amended by adding Subsection (d) to read as follows: (d) If a consumer requests a consumer file without requesting a consumer score, the consumer reporting agency shall provide to the consumer a statement indicating that the consumer is entitled to receive a credit score as provided by Section 20.035. (e) Chapter 20, Business & Commerce Code, is amended by adding Section 20.035 to read as follows: Sec. 20.035. DISCLOSURE OF CREDIT SCORE. (a) This section applies only to a consumer reporting agency that: (1) distributes a credit score that is used in connection with a residential real property loan; or (2) develops a credit score that assists a credit provider in evaluating a consumer's general creditworthiness and predicting the consumer's future credit standing. (b) On request for a credit score and presentation of proper identification provided by a consumer, a consumer reporting agency shall provide: (1) the consumer's current credit score or the consumer's most recent credit score that was previously computed by the agency for a purpose related to the extension of credit; (2) the range of possible credit scores under the measure or model used; (3) the four most important key factors, if any; (4) the date on which the credit score was created; (5) the name of the person or entity that provided the credit score or credit file on which the credit score was based; and (6) a statement indicating that the information and credit scoring model may be different than the credit score that may be used by the lender. (c) In complying with Subsection (b)(1), a consumer reporting agency shall provide to the consumer a credit score that: (1) is derived from a model that is widely distributed to users by the agency in connection with residential real property loans; or (2) assists a consumer in understanding the credit score assessment of the consumer's creditworthiness and predictions about the consumer's future credit standing. (d) The information required by this section must be disclosed within the same time and in the same manner as a consumer's credit file is required to be disclosed under this chapter. (e) A consumer reporting agency that distributes a credit score developed by another person or entity is not required to provide a further explanation of that score. The agency shall provide the consumer with the name, the address, and any electronic mail address for contacting the person or entity who developed the credit score or the credit score's methodology. (f) This section may not be construed to require a consumer reporting agency to maintain a credit score in a consumer's credit file. (g) In this section, "key factors" means all relevant reasons adversely affecting an individual's credit score that are listed in the order of importance based on their effect on the credit score. (f) Section 20.04, Business & Commerce Code, is amended by adding Subsection (c) to read as follows: (c) A consumer reporting agency may impose a reasonable charge for the disclosure of a credit score. The amount of the charge may not exceed the amount of a charge imposed under Subsection (a). SECTION 5. (a) Subchapter B, Government Code, is amended by adding Section 481.030 to read as follows: Sec. 481.030. REDISTRIBUTION OF CERTAIN COMMUNITY DEVELOPMENT OR REINVESTMENT FUNDS. (a) The department, not earlier than the 90th day before the end of each fiscal year, shall determine the amount of each appropriation or other funds of the department intended for the administration of community reinvestment or community development programs or activities that will remain unexpended or unobligated at the end of the fiscal year. (b) Before the end of the fiscal year, the department shall distribute each amount determined under Subsection (a), if any, to a community development center, community development financial institution, or other similar entity that agrees to use the amount under the direction of the department for any purpose for which the appropriation was made or the funds were intended. (b) Subchapter E, Chapter 2306, Government Code, is amended by adding Section 2306.101 to read as follows: Sec. 2306.101. REDISTRIBUTION OF CERTAIN COMMUNITY DEVELOPMENT OR REINVESTMENT FUNDS. (a) The department, not earlier than the 90th day before the end of each fiscal year, shall determine the amount of each appropriation or other funds of the department intended for the administration of community reinvestment or community development programs or activities that will remain unexpended or unobligated at the end of the fiscal year. (b) Before the end of the fiscal year, the department shall distribute each amount determined under Subsection (a), if any, to a community development center, community development financial institution, or other similar entity that agrees to use the amount under the direction of the department for any purpose for which the appropriation was made or the funds were intended. SECTION 6. Section 481.198, Government Code, is amended to read as follows: Sec. 481.198. MARKETING. (a) The department shall aggressively promote the linked deposit program established by this subchapter to eligible borrowers and financial institutions that make commercial loans and are depositories of state funds. The department's promotion efforts shall be designed to maximize use of the program. (a-1) The department shall provide information on the linked deposit program in English and in Spanish on the department's Internet website. (b) Not later than January 1 of each odd-numbered year, the department shall prepare and deliver to the governor, lieutenant governor, speaker of the house of representatives, and clerks of the standing committees of the senate and house of representatives with primary jurisdiction over commerce and economic development a report concerning the department's efforts in promoting the linked deposit program during the preceding two years. (c) The report required by Subsection (b) must include: (1) any factors identified by the department that may inhibit the use of the linked deposit program; and (2) any recommended action for increasing the use of the linked deposit program. SECTION 7. Subchapter BB, Chapter 481, Government Code, is amended by adding Section 481.415 to read as follows: Sec. 481.415. COMMUNITY INVESTMENT PROGRAM. (a) In this section: (1) "Community development financial institution" has the meaning assigned by 12 U.S.C. Section 4702, as amended. (2) "Community development investment" means a loan or grant made to a community development financial institution for the purpose of enhancing the provision of basic consumer financial services. (3) "Community development loan" means a loan from a community development financial institution to a low-income business or nonprofit organization for the purpose of revitalizing a distressed community. (4) "Eligible institution" means a community development financial institution meeting the minimum selection criteria described by 12 U.S.C. Section 4704, as amended. (b) Notwithstanding any other law, the department shall establish a community investment program in which the department makes grants or interest-free loans, using money in the fund, to eligible institutions that use the money to make community development loans in distressed areas of the state or to assist low-income areas by providing basic consumer financial services. (c) The department shall determine the eligibility of an institution by verifying that the institution meets the minimum selection criteria described by 12 U.S.C. Section 4704, as amended. The department may set a limit on the number of eligible institutions that may participate in the community investment program. To participate in the community investment program, an eligible institution must enter into a participation agreement with the department that sets out the terms and conditions under which the department will make a grant or loan to the eligible institution. (d) The department may make a grant to an institution or nonprofit organization to assist the institution or organization to: (1) meet the minimum selection criteria described by 12 U.S.C. Section 4704, as amended, or to otherwise obtain assistance under 12 U.S.C. Section 4701 et seq., as amended; and (2) become an eligible institution and participate in the community investment program. (e) The department may make a grant to a nonprofit organization the department determines is performing activities consistent with the goals of this section to provide the organization operating support, technical assistance, and training assistance. (f) The department shall adopt rules relating to the implementation of the community investment program and any other rules necessary to accomplish the purposes of this section. (g) An eligible institution may file a grant or loan application with the department. The application must be in a form approved by the department and include a plan of investment that includes the type and number of community development loans or investments that the institution plans to make using money from the community investment program. The department shall act on a completed application not later than the 30th day after the date on which the application is filed with the department. (h) All income received on a loan or investment made with money received under the community investment program is the property of the eligible institution that makes the loan or investment. (i) Not later than the 30th day after the expiration of each six-month period for which there is a participation agreement in effect between the department and an eligible institution, the eligible institution shall submit a report to the department that states in detail the status of each investment or loan made under the community investment program. The report must be in a form prescribed by the department and must contain all information required by the department as part of the institution's participation agreement. (j) The participation agreement between the eligible institution and the department must provide for an annual audit. The department shall adopt rules relating to the format of the audit, including rules allowing not more than $5,000 of the amount received by the eligible institution under the community investment program to be used to finance the audit. SECTION 8. (a) Subchapter B, Chapter 531, Government Code, is amended by adding Section 531.063 to read as follows: Sec. 531.063. ELIGIBILITY FOR PUBLIC ASSISTANCE: EXCLUSION OF CERTAIN INCOME AND RESOURCES. (a) In this section, "individual development account" has the meaning assigned by 42 U.S.C. Section 604(h)(2), as amended. (b) To the extent authorized by federal law, the commission and each health and human services agency may not consider money contributed to an individual development account established for a recipient of public assistance benefits as income or the balance of the account as a resource in determining whether the recipient meets household income and resource requirements for eligibility for public assistance benefits. (c) This section applies to an individual development account established for certain low-income individuals under the pilot program required by Section 301.068, Labor Code. (b) If before implementing any provision of Section 531.063, Government Code, as added by this section, a state agency determines that a waiver or authorization from a federal agency is necessary for implementation of that provision, the agency affected by the provision shall request the waiver or authorization and may delay implementing that provision until the waiver or authorization is granted. (c) Section 531.063, Government Code, as added by this section, applies to a person receiving public assistance benefits on or after that date, regardless of the date on which eligibility for those benefits was determined. SECTION 9. (a) Subchapter B, Chapter 1372, Government Code, is amended by adding Section 1372.0262 to read as follows: Sec. 1372.0262. RECOMMENDED ALLOCATION FOR HOUSING FINANCE CORPORATIONS. (a) In this section, "economic submarket" and "geographic submarket" have the meanings assigned by Section 2306.004. (b) In the state fiscal year beginning on September 1, 2004, and in each subsequent state fiscal year, a housing finance corporation shall attempt to allocate not less than 40 percent of its total single-family mortgage revenue bond loan volume to meet the credit needs of borrowers in underserved economic and geographic submarkets in the state, as indicated by the market study results provided to the Bond Review Board under Section 2306.142. (c) The housing finance corporation annually shall report to the Bond Review Board and to the Texas Department of Housing and Community Affairs on the extent to which the corporation achieves the goals of this section in a state fiscal year. If, in any state fiscal year, the housing finance corporation fails to achieve the goals of this section, the corporation shall include in its report the reasons why the loan volume was not allocated as recommended by this section, including reasons regarding unfeasibility, adverse financial effect, and low market volume demand, if applicable. (b) Section 394.027(b), Local Government Code, is amended to read as follows: (b) The report must include: (1) for each single-family home mortgage loan made by the housing finance corporation during the preceding 12 months ending June 30 of the year the report is filed, the data reported by originating lenders under the Federal Home Mortgage Disclosure Act; and (2) information regarding the corporation's allocation of single-family mortgage revenue bond loan volume to underserved economic and geographic submarkets in the state, as described by Section 1372.0262, Government Code. SECTION 10. (a) Articles 4.74(a), (c), and (d), Insurance Code, are amended to read as follows: (a) Notwithstanding any other provision of this subchapter, the comptroller may implement this subchapter only if the comptroller determines, on the basis of a revenue estimate made under this article [after the adjournment sine die of the regular session of the 77th Legislature], that revenues are anticipated in amounts sufficient to finance all appropriations made by the legislature [during the regular session of the 77th Legislature], after making deductions for all reductions in taxes, including the reduction in premium tax through premium tax credits authorized under this subchapter. Until the comptroller implements this subchapter as required by this article, the comptroller shall review the revenue estimate as required by this subsection after adjournment sine die of each legislative session during which the legislature enacts a General Appropriations Act that becomes law. (c) On a determination by the comptroller to implement this subchapter under Subsection (a) or (b) of this article, the comptroller shall specify a date, not later than the 90th day after the date of adjournment sine die of the appropriate legislative session, as the implementation date. Rules adopted under Subsection (b)(2) of this article may adjust any deadline or other date established by this subchapter as necessary to implement this subchapter in accordance with Subsection (b) of [as limited by] this article. (d) After each legislative session during which the legislature enacts a General Appropriations Act that becomes law, the [The] comptroller shall notify the governor, lieutenant governor, and speaker of the house of representatives of the determination made under [Subsection (a) of] this article. (b) Article 4.52, Insurance Code, is amended to read as follows: Art. 4.52. DUTIES OF COMPTROLLER; RULES. The comptroller shall administer this subchapter. The comptroller shall [and may] adopt rules and forms as necessary to implement this subchapter not later than the 90th day after the implementation date established under Article 4.74 of this code. (c) Article 4.53, Insurance Code, is amended by adding Subsection (f) to read as follows: (f) The comptroller shall begin accepting applications for certification under this article not later than the 120th day after the implementation date established under Article 4.74 of this code. (d) Article 4.65, Insurance Code, is amended by adding Subsection (d) to read as follows: (d) A certified investor may not make an investment with a certified capital company before the 225th day after the implementation date established under Article 4.74 of this code. (e) Article 4.66(a), Insurance Code, is amended to read as follows: (a) A premium tax credit allocation claim must be prepared and executed by a certified investor on a form provided by the comptroller. The certified capital company must file the claim with the comptroller not later than the 225th day after the implementation date established under Article 4.74 of this code [February 15, 2002]. The premium tax credit allocation claim form must include an affidavit of the certified investor under which the certified investor becomes legally bound and irrevocably committed to make an investment of certified capital in a certified capital company in the amount allocated even if the amount allocated is less than the amount of the claim, subject only to the receipt of an allocation under Article 4.68 of this code. (f) Article 4.68(c), Insurance Code, is amended to read as follows: (c) Not later than the 240th day after the implementation date established under Article 4.74 of this code [March 1, 2002], the comptroller shall notify each certified capital company of the amount of tax credits allocated to each certified investor. Each certified capital company shall notify each certified investor of their premium tax credit allocation. (g) Article 4.73(a), Insurance Code, is amended to read as follows: (a) After implementation of this subchapter under Article 4.74 of this code, the [The] comptroller shall prepare a biennial report with respect to results of the implementation of this subchapter. The report must include: (1) the number of certified capital companies holding certified capital; (2) the amount of certified capital invested in each certified capital company; (3) the amount of certified capital the certified capital company has invested in qualified businesses as of the first anniversary of the implementation date [January 1, 2004,] and the cumulative total for each subsequent year; (4) the total amount of tax credits granted under this subchapter for each year that credits have been granted; (5) the performance of each certified capital company with respect to renewal and reporting requirements imposed under this subchapter; (6) with respect to the qualified businesses in which certified capital companies have invested: (A) the classification of the qualified businesses according to the industrial sector and the size of the business; (B) the total number of jobs created by the investment and the average wages paid for the jobs; and (C) the total number of jobs retained as a result of the investment and the average wages paid for the jobs; and (7) the certified capital companies that have been decertified or that have failed to renew the certification and the reason for any decertification. SECTION 11. (a) The comptroller shall conduct a study of the availability of venture capital in this state and shall compare the availability of venture capital in this state to its availability in the other states. The comptroller may recommend actions that the legislature may take to improve the availability of venture capital in this state. (b) Before November 1, 2005, the comptroller shall report the comptroller's findings of the study conducted under Section 11(a) of this Act to the speaker of the house of representatives, the lieutenant governor, and the presiding officers of the senate business and commerce and house business and industry committees. SECTION 12. This Act takes effect September 1, 2003.