79R12046 ATP-D


By:  Castro                                                       H.B. No. 1232



A BILL TO BE ENTITLED

AN ACT

relating to the payment of certain expenses of a public project 
financed by certificates of obligation.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 271.045, Local Government Code, is 
amended by adding Subsection (e) to read as follows:
	(e)  Work that is directly attributable under generally 
accepted accounting principles to the costs of the project and that 
is performed by employees of the issuer may be allocated or 
attributed to the capital costs of the project.
	SECTION 2.  Section 271.050(b), Local Government Code, is 
amended to read as follows:
	(b)  The proceeds may be used only for the purposes for which 
the certificates were authorized and issued.  The proceeds may be 
used to pay for work done by employees of the issuer that are hired 
for the specific purpose of performing work on the project.  The 
proceeds may be used to pay for work done by other employees of the 
issuer only if the issuer incurs equivalent or greater costs to 
replace the normal work that would have otherwise been performed by 
the employees. The proceeds may not be used to reimburse the issuer 
for costs that are determined to be indirect costs under generally 
accepted accounting principles.  [The proceeds may not be used to 
pay for work done by employees of the issuer and paid for as work 
progresses.]  Any accrued interest received must be deposited in 
the interest and sinking fund established for the payment of the 
certificates.
	SECTION 3.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2005.