81R9187 KLA-D

By: Eiland H.B. No. 2749

A BILL TO BE ENTITLED

AN ACT

relating to economic recovery grants for certain municipalities following public calamities.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 418, Government Code, is amended by adding Subchapter D-1 to read as follows:

SUBCHAPTER D-1. GRANTS FOR ECONOMIC RECOVERY FOLLOWING PUBLIC

CALAMITY

Sec. 418.081. DEFINITIONS. In this subchapter:

(1) "Designated disaster area" means a geographical area of this state declared a disaster area by the governor under this chapter.

(2) "Disaster remediation project" means a project undertaken to restore the economy of a designated disaster area following a disaster, or to otherwise economically recover from or mitigate the effects of a disaster in a designated disaster area. The term includes projects financed in part using matching funds from a federal or state governmental entity and projects for removal, cleaning, sanitizing, demolition, reconstruction, or other treatment of improvements to real property undertaken because of damage or destruction to that property caused by a natural disaster.

Sec. 418.082. REQUEST FOR ECONOMIC RECOVERY GRANT. (a) The governing body of a municipality located in a designated disaster area may submit to the governor a request for a grant of public money authorized under Section 52-a, Article III, Texas Constitution, subject to the requirements of this subchapter, for the public purposes of redeveloping the municipality's economy following a disaster and mitigating the effects of that disaster on both the municipality's and the state's economies.

(b) A request made under this section must include a detailed disaster remediation plan that specifies:

(1) the period for which the grant is requested, not to exceed two years from the date of the governor's initial proclamation or executive order declaring the area in which the municipality is located to be a disaster area; and

(2) the disaster remediation projects that grant funds, if approved, would be used to wholly or partly finance, subject to Subsection (c).

(c) The governor may approve a municipality's request or may require that the municipality modify and resubmit the request for consideration and approval. The governor shall notify the comptroller of an approved request and the period for which the grant is approved.

Sec. 418.083. FUNDING. (a) An economic recovery grant approved by the governor under this subchapter for a municipality is a grant of state aid necessitated by a public calamity and shall be funded using proceeds from the collection of the taxes imposed by Chapter 151, Tax Code, in connection with a sale, storage, use, or other consumption that is consummated in the municipality during the grant period specified in the municipality's disaster remediation plan. Notwithstanding Section 151.801(a), Tax Code, and subject to Sections 151.801(b) and (c), Tax Code, the comptroller shall deposit the taxes described by this subsection that are collected by the comptroller in trust in a separate suspense account of the municipality.

(b) Not later than the fifth day of each month, the comptroller shall send to the municipal treasurer or to the person who performs the office of the municipal treasurer the taxes deposited in the suspense account under Subsection (a), payable to the municipality.

Sec. 418.084. USE OF GRANT FUNDS. (a) Economic recovery grant funds received under this subchapter may be used only for disaster remediation projects included in the municipality's approved grant request that are undertaken in the municipality to which the grant is awarded. The municipality shall give first priority to using the funds to leverage matching funds available from the Federal Emergency Management Agency and to stabilize the bond ratings of bonds issued by the municipality.

(b) A municipality may not use grant funds under this subchapter for ordinary operating expenses of the municipality unrelated to a disaster remediation project included in the municipality's approved grant request.

Sec. 418.085. QUARTERLY REPORTS. Not later than the 30th day after the last day of each calendar quarter during the period for which a grant is approved, the governing body of the municipality for which the grant was approved shall submit to the governor a report regarding the use of the grant funds. The report must provide a detailed accounting of the amount of funds received from the comptroller as provided by Section 418.083, the expenditures of grant funds during the previous calendar quarter, and the amount of unencumbered grant funds remaining on hand.

Sec. 418.086. FINAL REPORT. (a) Not later than the 180th day after the expiration of the period for which a grant is approved, the governing body of the municipality for which the grant was approved shall submit to the governor and the comptroller a final report regarding the use of the grant funds. The report must provide a detailed accounting of the amount of funds received from the comptroller as provided by Section 418.083 not included on a previous report, the expenditures of grant funds not included on a previous report, and the amount of unencumbered grant funds remaining on hand.

(b) The comptroller shall adjust the municipality's allocation and distribution of funds under Sections 321.501 and 321.502, Tax Code, in an amount equal to the amount of unencumbered grant funds remaining on hand or funds the comptroller determines were used for a purpose not authorized by this subchapter.

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 September 1, 2009.