86R5960 SLB-F
 
  By: Bonnen of Galveston H.B. No. 1800
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the Texas resilience infrastructure fund; authorizing
  the issuance of revenue bonds; making an appropriation.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 15, Water Code, is amended by adding
  Subchapter J-1 to read as follows:
  SUBCHAPTER J-1. TEXAS RESILIENCE INFRASTRUCTURE FUND
         Sec. 15.651.  DEFINITIONS. In this subchapter:
               (1)  "Advisory committee" means the Texas Resilience
  Infrastructure Fund Advisory Committee.
               (2)  "Coastal public land" means state-owned:
                     (A)  submerged land; and
                     (B)  islands or portions of islands in the coastal
  area.
               (3)  "Historically underutilized business" has the
  meaning assigned by Section 2161.001, Government Code.
               (4)  "Infrastructure fund" means the Texas resilience
  infrastructure fund.
               (5)  "Project sponsor" means a political subdivision
  that has the authority and financial capability to implement,
  operate, and maintain a resilience project.
               (6)  "Resilience project" means a project or program in
  this state and the coastal public land that prevents flooding or
  mitigates the damage from flooding related to a rainstorm, tropical
  storm or depression, hurricane, or storm surge affecting:
                     (A)  public health, safety, or welfare;
                     (B)  public property, including infrastructure;
                     (C)  privately owned commercial, agricultural, or
  residential property; or
                     (D)  fish or wildlife habitat.
               (7)  "Trust company" means the Texas Treasury
  Safekeeping Trust Company.
         Sec. 15.652.  INFRASTRUCTURE FUND. (a)  The Texas
  resilience infrastructure fund is a special fund in the state
  treasury outside the general revenue fund.
         (b)  The infrastructure fund may be used by the board,
  without further legislative appropriation, only as provided by this
  subchapter.
         (c)  Money deposited to the credit of the infrastructure fund
  may be used only as provided by this subchapter.
         (d)  The board may establish separate accounts in the
  infrastructure fund.
         (e)  The infrastructure fund and the infrastructure fund's
  accounts are kept and held by the trust company for and in the name
  of the board. The board has legal title to money and investments in
  the infrastructure fund until money is disbursed from the fund as
  provided by this subchapter and board rules.
         (f)  The infrastructure fund consists of:
               (1)  money transferred or deposited to the credit of
  the infrastructure fund by law;
               (2)  proceeds from the sale of revenue bonds:
                     (A)  issued by the board under this subchapter;
  and
                     (B)  designated by the board for the purpose of
  providing a loan award from the infrastructure fund in accordance
  with Section 15.654;
               (3)  loan repayments related to the issuance of an
  award from the infrastructure fund;
               (4)  any tax, fee, or other revenue that the
  legislature by statute dedicates for deposit to the credit of the
  infrastructure fund;
               (5)  investment earnings and interest earned on amounts
  credited to the infrastructure fund; and
               (6)  any gift or grant to the infrastructure fund.
         (g)  The Legislative Budget Board must give prior approval of
  each expenditure or emergency transfer made from the infrastructure
  fund by the board.
         Sec. 15.653.  MANAGEMENT AND INVESTMENT OF INFRASTRUCTURE
  FUND. (a)  The trust company shall hold and invest the
  infrastructure fund, and any accounts established in the fund, for
  and in the name of the board, taking into account the purposes for
  which money in the fund may be used.
         (b)  At all times the trust company shall hold in the
  infrastructure fund a reserve of not less than 10 percent of the
  aggregate principal amount of revenue bonds issued by the board
  under this subchapter.
         (c)  The trust company may invest not more than 15 percent of
  the total balance of the infrastructure fund not held in reserve.  
  The infrastructure fund may be invested with the state treasury
  pool.  The overall objective for the investment of the
  infrastructure fund is to maintain sufficient liquidity to meet the
  needs of the fund while striving to preserve the awarding power of
  the fund.
         (d)  The trust company has any power necessary to accomplish
  the purposes of managing and investing the assets of the
  infrastructure fund. In managing the assets of the infrastructure
  fund, through procedures and subject to restrictions the trust
  company considers appropriate, the trust company may acquire,
  exchange, sell, supervise, manage, or retain any kind of investment
  that a prudent investor, exercising reasonable care, skill, and
  caution, would acquire or retain in light of the purposes, terms,
  distribution requirements, and other circumstances of the
  infrastructure fund then prevailing, taking into consideration the
  investment of all the assets of the fund rather than a single
  investment.
         (e)  The trust company may charge the infrastructure fund to
  cover its costs incurred in managing and investing the fund. The
  charge must be consistent with the fees the trust company charges
  other state and local governmental entities for which it provides
  investment management services. The trust company may recover
  charges under this subsection only from the earnings of the
  infrastructure fund.
         (f)  The trust company annually shall provide a written
  report to the board and to the advisory committee with respect to
  the investment of the infrastructure fund. The trust company shall
  contract with a certified public accountant to conduct an
  independent audit of the infrastructure fund annually and shall
  present the results of each annual audit to the board and to the
  advisory committee. This subsection does not affect the state
  auditor's authority to conduct an audit of the infrastructure fund
  under Chapter 321, Government Code.
         (g)  The trust company shall adopt a written investment
  policy that is appropriate for the infrastructure fund.  The trust
  company shall present the investment policy to the investment
  advisory board established under Section 404.028, Government Code.
  The investment advisory board shall submit to the trust company
  recommendations regarding the policy.
         (h)  The board shall provide to the trust company:
               (1)  an annual forecast of the cash flows into and out
  of the infrastructure fund; and
               (2)  updates to the forecasts as appropriate to ensure
  that the trust company is able to achieve the objective specified by
  Subsection (c).
         (i)  Subject to Subsection (b), the trust company shall
  disburse money from the infrastructure fund as directed by the
  board.
         (j)  An investment-related contract entered into under this
  section is not subject to Chapter 2260, Government Code.
         Sec. 15.654.  USE OF INFRASTRUCTURE FUND. (a)  The board may
  use money from the infrastructure fund to provide financing for
  resilience projects.
         (b)  The board may award money from the infrastructure fund
  for a resilience project only in the form of:
               (1)  a grant to a receiving project sponsor; or
               (2)  a loan as provided by Subsection (e).
         (c)  Money from the infrastructure fund may be awarded to
  several project sponsors of a single resilience project.
         (d)  An award issued as a grant may finance:
               (1)  not more than 75 percent of the total cost of a
  resilience project; or
               (2)  up to 100 percent of the local matching funds for a
  federally qualifying resilience project.
         (e)  A project sponsor receiving a grant for a resilience
  project also may receive a loan from the infrastructure fund to
  finance the remaining cost of the project if the project sponsor can
  certify a source of loan repayment through governmental funding
  agreements approved by the attorney general.  The project sponsor
  must repay to the infrastructure fund any subsequent reimbursements
  received by the project sponsor related to the approved funding
  agreement until the loan principal and related interest is repaid
  in full.  In addition, the board may award money from the
  infrastructure fund in the form of a loan instead of a grant at any
  time the balance of the fund is less than $200 million. The terms of
  a loan made under this subsection must be in accordance with board
  rules governing the terms of loans for resilience projects.
         (f)  The board may award money from the infrastructure fund
  to finance portions of a resilience project necessary for
  construction and implementation of the project, including mapping,
  studies, design, right-of-way acquisition, permitting, the
  purchase or contracting of goods and services, and administrative
  costs.
         (g)  The board may award money from the infrastructure fund
  to finance regular updates and enhancements to the State of Texas
  Hazard Mitigation Plan, as well as to finance the development of
  hazard mitigation plans of political subdivisions, under
  guidelines issued by the Federal Emergency Management Agency and
  the Texas Division of Emergency Management.
         (h)  On recommendation by the advisory committee, the board
  shall transfer money from the infrastructure fund to another state
  agency to support resilience projects.  Not more than a total of 10
  percent of the available and unencumbered infrastructure fund, as
  certified by the comptroller at the beginning of a state fiscal
  biennium, may be transferred in that biennium under this
  subsection.
         (i)  The board shall ensure that every effort is made to use
  money from the infrastructure fund to obtain federal, local, and
  private financing for a resilience project.
         (j)  Money from the infrastructure fund may not be used for
  ongoing operation and maintenance costs of a resilience project.
         Sec. 15.655.  EMERGENCY USE OF INFRASTRUCTURE FUND. (a)  
  Notwithstanding Section 15.654, on the issuance of an executive
  order or proclamation declaring a state of disaster related to
  flooding in accordance with Chapter 418, Government Code, the board
  may expend an amount not to exceed five percent of the available and
  unencumbered infrastructure fund balance at the time of a disaster
  declaration for disaster recovery purposes.
         (b)  The board may expend an additional amount not to exceed
  2.5 percent of the available and unencumbered infrastructure fund
  balance at the time of a renewal by the governor of a state of
  disaster related to flooding for disaster recovery purposes.
         (c)  Notwithstanding Subsections (a) and (b), the board may
  not expend from the infrastructure fund for disaster recovery
  purposes during a state fiscal year an amount that exceeds 10
  percent of the available and unencumbered infrastructure fund
  balance at the time of the first flooding-related disaster
  declaration made during that fiscal year.
         Sec. 15.656.  PARTNERSHIPS. (a)  A project sponsor may enter
  into a partnership with a nongovernmental entity to finance the
  construction, implementation, operation, and maintenance of a
  resilience project.  Only a project sponsor may enter into an
  agreement with the board for an award from the infrastructure fund.
         (b)  A project sponsor must include full disclosure of any
  partnership between the project sponsor and a nongovernmental
  entity in an application for an award from the infrastructure fund.
         Sec. 15.657.  APPLICATION REVIEW PROCEDURES. (a) The board
  shall review an application for an award for a resilience project
  immediately on receipt of the application.  If the board determines
  that an application is incomplete, the board shall notify the
  applicant with an explanation of what is missing from the
  application.  The board shall evaluate the completed application
  according to the appropriate project criteria.  The board shall
  make a final determination on an application as soon as possible.
         (b)  The board shall make every effort to expedite the
  application review process and to award grants or loans to project
  sponsors in a timely manner.
         (c)  At any time the balance of the infrastructure fund is
  less than $200 million, the board shall notify all applicants with
  applications pending and provide them with the option to apply for a
  loan from the fund.
         (d)  If the board determines that an applicant should receive
  an award of money from the infrastructure fund, the board must
  submit the application to the advisory committee for review and
  comments.
         (e)  The advisory committee shall review each application
  submitted by the board and deliver comments on the application to
  the board not later than the 30th day after the date on which the
  board received the application.
         (f)  If revenue bonds are to be issued for the purpose of
  awarding to an applicant money from the infrastructure fund, the
  board must submit the application and comments from the advisory
  committee to the bond review board and the attorney general for
  approval.
         (g)  After an application has been reviewed and received
  comments from the advisory committee and, if applicable, has been
  approved by the bond review board and the attorney general, the
  board shall submit the application and all related comments and
  approvals to the lieutenant governor and speaker of the house of
  representatives for approval.
         Sec. 15.658.  AWARD APPROVAL. (a)  The board may award money
  from the infrastructure fund for a resilience project only after:
               (1)  the advisory committee has reviewed and commented
  on the project; and
               (2)  the expenditure is approved by the Legislative
  Budget Board.
         (b)  For purposes of Subsection (a), an award of money from
  the infrastructure fund is considered disapproved by the
  Legislative Budget Board if that agency does not approve the
  proposal to issue the award before the 31st day after the date of
  receipt of the proposal from the board.  The Legislative Budget
  Board may extend the review deadline applicable to that agency for
  an additional 14 days by submitting a written notice to that effect
  to the board before the expiration of the initial review period.
         Sec. 15.659.  REPAYMENT OF AWARDS. (a)  If an award
  recipient has not used or obligated money awarded from the
  infrastructure fund for the purposes for which the award was
  intended before a date provided in the award agreement, the
  recipient must repay to the credit of the fund that amount and pay
  to the credit of the fund any related interest at a rate and on terms
  as provided by the award agreement.
         (b)  All payments of principal and interest on a loan awarded
  from the infrastructure fund shall be deposited to the credit of the
  fund.
         Sec. 15.660.  REVENUE BONDS. (a)  The board may issue
  revenue bonds to provide the principal for loan financing of a
  resilience project when the balance of the infrastructure fund is
  less than $200 million.
         (b)  Revenue bonds issued under this subchapter are special
  obligations of the board payable only from and secured by
  designated income and receipts of the infrastructure fund, or of
  one or more accounts in the fund, including principal of and
  interest paid and to be paid on fund assets or income from accounts
  created within the fund by the board, as determined by the board.
         (c)  Revenue bonds issued under this subchapter do not
  constitute indebtedness of the state as prohibited by the
  constitution.
         (d)  The board may require a project sponsor to make charges,
  impose taxes that the project sponsor is otherwise authorized to
  impose, or otherwise provide for sufficient money to pay acquired
  obligations related to an award financed through a revenue bond
  issued under this subchapter.
         (e)  Revenue bonds issued under this subchapter must be
  authorized by resolution of the board and must have the form and
  characteristics and bear the designations as the resolution
  provides.
         (f)  Revenue bonds issued under this subchapter may:
               (1)  bear interest at the rate or rates payable
  annually or otherwise;
               (2)  be dated;
               (3)  mature at the time or times, serially, as term
  revenue bonds, or otherwise in not more than the 50th year from the
  date the revenue bonds were issued;
               (4)  be callable before stated maturity on the terms
  and at the prices, be in the denominations, be in the form, either
  coupon or registered, carry registration privileges as to principal
  only or as to both principal and interest and as to successive
  exchange of coupon for registered bonds or one denomination for
  bonds of other denominations, and successive exchange of registered
  revenue bonds for coupon revenue bonds, be executed in the manner,
  and be payable at the place or places inside or outside the state,
  as provided by the resolution; and
               (5)  be issued in temporary or permanent form.
         (g)  Section 17.955 applies to revenue bonds issued under
  this subchapter in the same manner as that section applies to water
  financial assistance bonds.
         (h)  The board shall deposit the proceeds from the sale of
  revenue bonds issued under this subchapter to the credit of the
  infrastructure fund.  Money deposited under this subsection may be
  used only to finance a resilience project under this subchapter.
         (i)  Each revenue bond authorization and issuance under this
  subchapter must be authorized and issued for a single resilience
  project.
         (j)  On approval by the bond review board and the attorney
  general, the board may authorize and issue revenue bonds to finance
  multiple resilience project awards if the awards will all be
  received by the same project sponsor or sponsors for a single
  resilience project.
         (k)  The aggregate principal amount of revenue bonds issued
  by the board for resilience projects may not exceed the lesser of $2
  billion or 1,000 percent of the amount of the infrastructure fund
  that the trust company holds in reserve.
         (l)  A revenue bond may not be issued by the board for a
  resilience project unless:
               (1)  the revenue bond is approved by the bond review
  board in accordance with Chapter 1231, Government Code; and
               (2)  the attorney general approves the issuance of the
  bond after finding that the bonds have been authorized in
  accordance with the law and that the project sponsor receiving an
  award from the infrastructure fund has the legal authority to
  implement a resilience project.
         (m)  The comptroller shall register all revenue bonds issued
  by the board for resilience projects.
         (n)  Following registration of the bonds, revenue bonds
  issued by the board for resilience projects are incontestable in
  any court or other forum for any reason and are valid and binding
  obligations in accordance with their terms for all purposes.
         Sec. 15.661.  DEFAULT, REMEDIES, AND ENFORCEMENT. (a)  In
  this section, "Default" means:
               (1)  default in payment of the principal of or interest
  on an award issued as a loan from the infrastructure fund;
               (2)  a failure to perform any of the terms of a loan,
  grant, or other financing agreement; or
               (3)  any other failure to perform an obligation, breach
  of a term of an agreement, or default as provided by any proceeding
  or agreement evidencing an obligation or agreement of a recipient,
  beneficiary, or guarantor of financial assistance provided by the
  board.
         (b)  In the event of a default by a project sponsor and on
  request by the board, the attorney general shall seek:
               (1)  a writ of mandamus to compel a project sponsor or
  the project sponsor's officers, agents, and employees to cure the
  default; and
               (2)  any other legal or equitable remedy the board and
  the attorney general consider necessary and appropriate.
         (c)  A proceeding authorized by this section shall be brought
  and venue is in a district court in Travis County.
         (d)  In a proceeding under this section, the attorney general
  may recover reasonable attorney's fees, investigative costs, and
  court costs incurred on behalf of the state in the proceeding in the
  same manner as provided by general law for a private litigant.
         Sec. 15.662.  PRIORITIZATION OF PROJECTS. (a) The board may
  not prioritize a resilience project under this section unless the
  political subdivision benefiting from the proposed resiliency
  project is implementing current floodplain regulations.
         (b)  The board shall establish a point system for
  prioritizing resilience projects for which money from the
  infrastructure fund is sought. The system must include a standard
  for the board to apply in determining whether a resilience project
  qualifies for funding at the time the application for funding is
  filed with the board.
         (c)  The board shall give the highest consideration in
  awarding points to a resilience project that will have a
  substantial effect, including a resilience project that:
               (1)  has been awarded federal money;
               (2)  is being studied by the United States Army Corps of
  Engineers at the time of the project application;
               (3)  is included in a signed United States Army Corps of
  Engineers Chief's Report at the time of the project application;
               (4)  aligns with the priorities and goals of the State
  of Texas Hazard Mitigation Plan;
               (5)  will serve a political subdivision that has a
  completed hazard mitigation plan approved by the Texas Division of
  Emergency Management and the Federal Emergency Management Agency;
               (6)  will serve diverse urban and rural populations;
               (7)  will serve a metropolitan statistical area with a
  population greater than 250,000;
               (8)  will contribute to regionalization in resiliency;
               (9)  is included in the Texas Coastal Resiliency Master
  Plan; 
               (10)  is included in the State Flood Assessment or a
  statewide flood plan;
               (11)  will serve a political subdivision that has
  received multiple state disaster declarations made under Chapter
  418, Government Code, or multiple federal major disaster
  declarations under the Robert T. Stafford Disaster Relief and
  Emergency Assistance Act (42 U.S.C. 5121 et seq.), during the five
  years before the date the board receives an application for the
  resilience project under consideration; or
               (12)  includes a substantial water supply or water
  management benefit.
         (d)  In addition to the criteria provided by Subsection (c),
  the board must also consider at least the following criteria in
  prioritizing projects:
               (1)  the contribution to be made by the applicant to
  finance the resilience project, including the up-front capital to
  be provided by the applicant;
               (2)  the ability of the board and the applicant to use
  state financing to obtain local and federal funding;
               (3)  whether there is an emergency need for the
  resilience project;
               (4)  whether federal funding for which the resilience
  project is eligible has been used or sought;
               (5)  whether the applicant is ready to proceed with the
  resilience project at the time of the application, including
  whether:
                     (A)  all preliminary planning and design work
  associated with the resilience project has been completed;
                     (B)  the applicant has acquired right-of-way
  associated with the resilience project;
                     (C)  the applicant has secured funding for the
  resilience project from other sources; and
                     (D)  the applicant is able to begin implementing
  or constructing the resilience project;
               (6)  the resilience project's cost-to-benefit ratio as
  calculated according to board rules; and
               (7)  if applicable, the ability of the applicant to
  repay a loan awarded from the infrastructure fund.
         Sec. 15.663.  REPORTING AND TRANSPARENCY REQUIREMENTS. (a)  
  Not later than December 1 of each even-numbered year, the board
  shall provide to the governor, lieutenant governor, speaker of the
  house of representatives, and members of the legislature a report
  regarding the use of the infrastructure fund.
         (b)  The board shall post the following information on the
  board's Internet website regarding the use of the infrastructure
  fund and regularly update the information posted:
               (1)  the progress made in developing resilience
  projects statewide;
               (2)  a description of each resilience project that
  receives money from the infrastructure fund, including:
                     (A)  the expected date of completion of the
  resilience project;
                     (B)  the current status of the resilience project;
                     (C)  the proposed benefit of the resilience
  project;
                     (D)  the initial total cost estimate of the
  resilience project and variances to the initial cost estimate
  exceeding five percent;
                     (E)  a listing of the project sponsor receiving
  money from the infrastructure fund;
                     (F)  a listing of each political subdivision
  served by each resilience project;
                     (G)  an estimate of matching funds that will be
  available for the resilience project resulting from the use of the
  infrastructure fund;
                     (H)  if applicable, the amount of bonds issued and
  the terms of the bonds; and
                     (I)  the status of repayment of each loan provided
  in connection with a resilience project, including an assessment of
  the risk of default based on a standard risk rating system;
               (3)  a description of the investment portfolio of the
  infrastructure fund;
               (4)  the expenses incurred in investing money in the
  infrastructure fund;
               (5)  the rate of return on the investment of money in
  the infrastructure fund; 
               (6)  a description of the point system for prioritizing
  resilience projects established by the board under Section 15.662
  and the number of points awarded by the board for each resilience
  project;
               (7)  any nonconfidential information submitted to the
  board as part of an application for funding under this subchapter
  that is approved by the board;
               (8)  the administrative and operating expenses
  incurred by the board in administering the infrastructure fund; and
               (9)  any other information required by board rule.
         (c)  In addition to the information described by Subsection
  (b), the report described by Subsection (a) must also include:
               (1)  the policies and procedures used for any
  procurement of property or services related to a resilience
  project, including any policies and procedures meant to increase
  participation by historically underutilized businesses;
               (2)  the written standards of conduct covering
  conflicts of interest and governing the performance of the board's
  staff who engage in the review, recommendation, and administration
  of awards from the infrastructure fund;
               (3)  all direct and indirect administrative costs
  related to the administration of the infrastructure fund;
               (4)  the cost-to-benefit ratio related to each
  resilience project;
               (5)  the end of fiscal year balance of the
  infrastructure fund as estimated by the comptroller; and
               (6)  a record of all transfers made from the
  infrastructure fund to other state agencies, including:
                     (A)  an account of each receiving state agency;
                     (B)  the amount of each transfer;
                     (C)  a description of each receiving state
  agency's program that supports resilience projects; and
                     (D)  an account of all disbursements made by
  receiving state agencies in support of resilience projects during
  the fiscal year.
         Sec. 15.664.  TEXAS RESILIENCE INFRASTRUCTURE FUND ADVISORY
  COMMITTEE. (a) The Texas Resilience Infrastructure Fund Advisory
  Committee is composed of the following five members:
               (1)  the comptroller, or a person designated by the
  comptroller;
               (2)  two members of the senate appointed by the
  lieutenant governor, including:
                     (A)  a member of the committee of the senate
  having primary jurisdiction over matters relating to finance; and
                     (B)  a member of the committee of the senate
  having primary jurisdiction over agriculture, water, and rural
  affairs; and
               (3)  two members of the house of representatives
  appointed by the speaker of the house of representatives,
  including:
                     (A)  a member of the committee of the house of
  representatives having primary jurisdiction over appropriations;
  and
                     (B)  a member of the committee of the house of
  representatives having primary jurisdiction over natural
  resources.
         (b)  The lieutenant governor shall appoint a co-presiding
  officer of the advisory committee from among the members appointed
  by the lieutenant governor, and the speaker of the house of
  representatives shall appoint a co-presiding officer of the
  committee from among the members appointed by the speaker.
         (c)  The advisory committee may hold public hearings, formal
  meetings, or work sessions. Either co-presiding officer of the
  advisory committee may call a public hearing, formal meeting, or
  work session of the advisory committee at any time. The advisory
  committee may not take formal action at a public hearing, formal
  meeting, or work session unless a quorum of the committee is
  present.
         (d)  Except as otherwise provided by this subsection, a
  member of the advisory committee is not entitled to receive
  compensation for service on the committee or reimbursement for
  expenses incurred in the performance of official duties as a member
  of the committee.  Service on the advisory committee by a member of
  the senate or house of representatives is considered legislative
  service for which the member is entitled to reimbursement and other
  benefits in the same manner and to the same extent as for other
  legislative service.
         (e)  The advisory committee shall submit comments and
  recommendations to the board regarding the use of money in the
  infrastructure fund for use by the board in adopting rules,
  policies, and procedures. The submission must include:
               (1)  comments and recommendations on rulemaking
  related to the prioritization of resilience projects;
               (2)  comments and recommendations on rulemaking
  related to establishing standards for determining whether
  resilience projects meet the criteria provided by Section 15.658;
               (3)  an evaluation of the use of money by the board to
  provide funding for resilience projects, including meeting federal
  and local matching requirements;
               (4)  an evaluation of methods for encouraging
  participation in the procurement process by companies domiciled in
  this state or that employ a significant number of residents of this
  state; and
               (5)  an evaluation of the overall operation, function,
  and structure of the infrastructure fund.
         (f)  The advisory committee shall review the overall
  operation, function, and structure of the infrastructure fund at
  least semiannually and may provide comments and recommendations to
  the board on any matter.
         (g)  The advisory committee may adopt rules, procedures, and
  policies as needed to administer this section and implement its
  responsibilities.
         (h)  Chapter 2110, Government Code, does not apply to the
  size, composition, or duration of the advisory committee.
         (i)  The advisory committee shall make recommendations to
  the board regarding information to be posted on the board's
  Internet website.
         (j)  The advisory committee shall evaluate and may provide
  comments or recommendations on the feasibility of the state owning,
  constructing, operating, and maintaining resilience projects,
  including reservoirs and coastal barriers.
         (k)  The advisory committee independently may propose and
  make recommendations for the funding and implementation of a
  resilience project and identify and recommend an appropriate
  project sponsor.
         (l)  The advisory committee may identify programs
  administered by state agencies that support resilience projects and
  recommend that money from the infrastructure fund be transferred to
  those agencies for the support of resilience projects.
         (m)  The executive administrator shall provide an annual
  report to the advisory committee on:
               (1)  the board's compliance with statewide annual goals
  relating to historically underutilized businesses; and
               (2)  the participation level of historically
  underutilized businesses in resilience projects that receive money
  from the infrastructure fund.
         (n)  If the aggregate level of participation by historically
  underutilized businesses in resilience projects that receive money
  from the infrastructure fund does not meet statewide annual goals
  adopted under Chapter 2161, Government Code, the advisory committee
  shall make recommendations to the board to improve the
  participation level.
         (o)  The board shall supply staff support to the advisory
  committee.
         Sec. 15.665.  RULES. (a)  The board shall adopt rules
  providing for the use of money in the infrastructure fund that are
  consistent with this subchapter, including rules:
               (1)  establishing standards for the eligibility for
  funding of resilience projects;
               (2)  establishing the prioritization of resilience
  projects;
               (3)  establishing terms for the repayment of a loan
  award from the infrastructure fund; and
               (4)  establishing terms for the completion of a
  resilience project.
         (b)  The rules establishing terms for the repayment of a loan
  award from the infrastructure fund must provide for:
               (1)  an amortization schedule not to exceed 30 years;
               (2)  an interest rate at or below the market rate at the
  time an application is approved for an award;
               (3)  no penalties for early repayment; and
               (4)  principal and interest payments on the loan to
  begin not later than 18 months after the date the loan is
  originated.
         (c)  The board shall give full consideration to the
  recommendations of the advisory committee before adopting rules
  under this subchapter.
         Sec. 15.666.  POLICIES AND PROCEDURES TO MITIGATE OR
  MINIMIZE ADVERSE EFFECTS OF CERTAIN FEDERAL LAWS. The board shall
  adopt, and may amend from time to time at the board's discretion,
  policies and procedures for the purpose of mitigating or minimizing
  the adverse effects, if any, of federal laws and regulations
  relating to income taxes, arbitrage, rebates, and related matters
  that may restrict the board's ability to freely invest all or part
  of the fund or to receive and retain all the earnings from the
  infrastructure fund.
         SECTION 2.  Not later than the 30th day after the effective
  date of this Act, the lieutenant governor and the speaker of the
  house of representatives shall appoint the initial members of the
  Texas Resilience Infrastructure Fund Advisory Committee as
  provided by Section 15.664, Water Code, as added by this Act.
         SECTION 3.  (a)  Not later than the 120th day after the
  effective date of this Act, the Texas Resilience Infrastructure
  Fund Advisory Committee shall submit recommendations to the Texas
  Water Development Board on the rules to be adopted by the board
  under Section 15.665, Water Code, as added by this Act, and the
  policies and procedures to be adopted by the board under Section
  15.666, Water Code, as added by this Act.
         (b)  Not later than the 90th day after the date the Texas
  Water Development Board receives the recommendations described by
  Subsection (a) of this section, the board shall adopt rules under
  Section 15.665, Water Code, as added by this Act, and policies and
  procedures under Section 15.666, Water Code, as added by this Act.
         SECTION 4.  (a) The amount of $1.5 billion is appropriated
  out of the economic stabilization fund to the Texas resilience
  infrastructure fund for purposes of implementing Subchapter J-1,
  Chapter 15, Water Code, as added by this Act.
         (b)  The amount of $1.5 billion is appropriated out of the
  economic stabilization fund to general revenue dedicated account
  number 453, Disaster Contingency Fund, and, in addition to other
  amounts appropriated to the Department of Public Safety for the
  state fiscal biennium ending August 31, 2021, $1.5 billion is
  appropriated out of general revenue dedicated account number 453,
  Disaster Contingency Fund, to the Department of Public Safety for
  that state fiscal biennium for purposes of providing local
  government entities local matching funds related to the Public
  Assistance Grant Program and Hazard Mitigation Grant Program
  administered by the Federal Emergency Management Agency.
         (c)  This section takes effect only if this Act is approved
  by a vote of two-thirds of the members present in each house of the
  legislature, as provided by Section 49-g(m), Article III, Texas
  Constitution.
         SECTION 5.  Except as otherwise provided by this Act, 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, 2019.