H.B. No. 3147
AN ACT
relating to authorizing the Texas Building and Procurement
Commission to enter into more favorable lease with option to
purchase agreements with regards to certain space currently
occupied under lease with option to purchase agreements.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter J, Chapter 2166, Government Code, is
amended by adding Sections 2166.454, 2166.4541, and 2166.4542 to
read as follows:
Sec. 2166.454. PURCHASING OR OBTAINING MORE FAVORABLE LEASE
WITH OPTION TO PURCHASE AGREEMENTS WITH REGARD TO CERTAIN LEASED
SPACE. (a) This section and Sections 2166.4541 and 2166.4542 apply
only in relation to space currently occupied by a state agency under
one of seven lease with an option to purchase agreements:
(1) entered into by the state before December 1994,
for the benefit of the Texas Commission on Environmental Quality or
its predecessor agency, the office of the attorney general, the
successor of the Department of Human Services, the Department of
Family and Protective Services, or the Texas Department of
Transportation; and
(2) under which the state may acquire title to the
space by paying the purchase price remaining under the terms of the
agreement on September 1 of an odd-numbered year.
(b) If the commission determines that it is advantageous to
the state, the commission may:
(1) request the Texas Public Finance Authority to
issue revenue bonds to finance the purchase of any or all of the
space to which this section applies in accordance with Section
2166.4542 and Chapter 1232, if the commission determines that it is
more advantageous to the state to purchase the space than to enter
into a more favorable lease with an option to purchase agreement
under Section 2166.4541 for that space; or
(2) enter into a more favorable lease with an option to
purchase agreement with regard to any or all of the space to which
this section applies by taking the actions authorized by Section
2166.4541 under the conditions prescribed by Section 2166.4541, if
the commission determines that it is more advantageous to the state
to enter into a more favorable lease with an option to purchase
agreement for that space than to purchase the space under Section
2166.4542 and Chapter 1232.
(c) This section expires September 2, 2008, except that this
section is continued in effect after that date for the limited
purpose of applying with regard to any transaction authorized by
this section and Section 2166.4541 or 2166.4542 that occurs before
that date.
Sec. 2166.4541. ENTERING INTO MORE FAVORABLE LEASE WITH
OPTION TO PURCHASE AGREEMENTS. (a) Subject to Section
2166.454(b), the commission may issue sale and lease purchase
revenue obligations in accordance with this section and use the
proceeds of the revenue obligations to:
(1) pay the commission's expenses in connection with
issuing the revenue obligations;
(2) purchase any or all of the space described by
Section 2166.454(a) according to the terms of the applicable
existing lease with an option to purchase agreement or agreements;
and
(3) if it is advisable to make capital improvements to
the space, pay for making the capital improvements.
(b) The revenue obligations issued under Subsection (a)
must be paid in their entirety immediately after issuance by using
the proceeds of the concurrent sale of the space by the commission
to a third party who agrees to lease the space back to the state with
an option to purchase under the following conditions:
(1) the term of the new lease with an option to
purchase agreement does not exceed the remaining term on the
applicable existing lease with an option to purchase agreement, as
of the date on which the transactions described by this section
occur; and
(2) the cost to the state under the new lease with an
option to purchase agreement is less than the cost to the state
under the existing lease with an option to purchase agreement and
the difference in cost justifies any costs incurred by the
commission and the state in taking actions under this section with
regard to the space.
(c) The commission shall obtain the approval of the Bond
Review Board before issuing a sale and lease purchase revenue
obligation under this section.
(d) Any sale and lease purchase revenue obligations issued
by the commission under this section and any lease with an option to
purchase agreement entered into under this section must be
submitted to the attorney general for review and approval. If the
attorney general determines that the obligation or agreement, as
applicable, entered into under this section complies with this
section, the attorney general shall approve the issuance of the
obligation or the agreement, as applicable. On approval by the
attorney general, the obligation or agreement, as applicable, is
incontestable for any cause.
(e) A sale and lease purchase revenue obligation issued
under this section is not a debt of the state or any state agency, is
not a pledge of the faith and credit or the taxing power of the
state, and may be paid only from the proceeds of the concurrent sale
of the space to which the sale and lease purchase revenue obligation
relates. A sale and lease purchase revenue obligation issued under
this section must contain a statement to that effect.
(f) A lease with an option to purchase agreement entered
into under this section must contain a statement that the agreement
is not a debt of the state or any state agency and is contingent on
continued legislative appropriations for making the lease
payments.
(g) This section expires September 2, 2008, except that this
section is continued in effect after that date for the limited
purpose of applying with regard to any transaction authorized by
Section 2166.454 and this section that occurs before that date.
Sec. 2166.4542. PURCHASING CERTAIN LEASED SPACE. (a)
Subject to Section 2166.454(b), the commission may purchase any or
all of the space described by Section 2166.454(a) in accordance
with this section and Chapter 1232.
(b) The commission shall request the Texas Public Finance
Authority to issue revenue obligations to finance the purchase
price of any or all of the space described by Section 2166.454(a)
that the commission elects to purchase under this section. The
authority shall issue the revenue obligations in accordance with
and subject to all provisions of Chapter 1232 applicable to revenue
obligations, including all provisions relating to ensuring that the
revenue obligations are paid, except that Section 1232.108(2) does
not apply.
(c) The authority shall issue the revenue obligations in
amounts sufficient to:
(1) pay the authority's expenses in connection with
issuing the revenue obligations;
(2) pay the purchase price of the space described by
Section 2166.454(a) included in the request of the commission
according to the terms of the applicable existing lease with an
option to purchase agreement or agreements; and
(3) if the commission considers it advisable to make
capital improvements to the space, pay for making the capital
improvements.
(d) At the time that a building is purchased under this
section, money specifically appropriated by the legislature to an
agency occupying space in the building for lease payments under the
applicable lease with an option to purchase agreement, or the money
available to and budgeted by the agency for that purpose, shall be
transferred to the commission and used by the commission only to
make the required lease or rental payments to the authority during
the remainder of the state fiscal biennium during which the
building was purchased under this section.
(e) This section expires September 2, 2008, except that this
section is continued in effect after that date for the limited
purpose of applying with regard to any transaction authorized by
Section 2166.454 and this section that occurs before that date.
SECTION 2. 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 on the 91st day after the last day of the
legislative session.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 3147 was passed by the House on May 9,
2005, by the following vote: Yeas 144, Nays 0, 3 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 3147 on May 24, 2005, by the following vote: Yeas 140, Nays 2,
1 present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 3147 was passed by the Senate, with
amendments, on May 23, 2005, by the following vote: Yeas 31, Nays
0.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor