Texas 2009 - 81st Regular

Texas Senate Bill SB684 Compare Versions

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1	1	By: Lucio, et al. S.B. No. 684
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to the establishment of the Texas Rural Development Fund
7	7	and to the establishment, operation, and funding of certain
8	8	programs for rural economic development.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 487.001, Government Code, is amended by
11	11	adding Subdivision (3) to read as follows:
12	12	(3) "Rural area" means an area that is predominately
13	13	rural in character as defined by the office.
14	14	SECTION 2. Subchapter C, Chapter 487, Government Code, is
15	15	amended by adding Section 487.062 to read as follows:
16	16	Sec. 487.062. TRAINING. (a) The office may develop and
17	17	administer a training program related to the programs and
18	18	activities established under Subchapters S, T, U, V, W, and X.
19	19	(b) The office may contract with a public or private entity
20	20	to develop and provide the training under this section.
21	21	SECTION 3. Chapter 487, Government Code, is amended by
22	22	adding Subchapters R through X to read as follows:
23	23	SUBCHAPTER R. TEXAS RURAL DEVELOPMENT FUND
24	24	Sec. 487.801. TEXAS RURAL DEVELOPMENT FUND. (a) The Texas
25	25	Rural Development Fund is an account in the general revenue fund.
26	26	The account is composed of:
27	27	(1) legislative appropriations;
28	28	(2) gifts, donations, grants, and matching funds
29	29	received under Subsection (b); and
30	30	(3) other money required by law to be deposited in the
31	31	account.
32	32	(b) The office may solicit and accept gifts, donations,
33	33	grants, and matching funds of money from the federal government,
34	34	local governments, private corporations, or other persons to be
35	35	used for the purposes of Subchapters S, T, U, V, W, and X.
36	36	(c) Income from money in the account shall be credited to
37	37	the account.
38	38	(d) Money in the development fund may be used only for the
39	39	purpose of implementing and maintaining the programs established
40	40	under Subchapters S, T, U, V, W, and X.
41	41	SUBCHAPTER S. RURAL ENTREPRENEURSHIP AND BUSINESS INNOVATION
42	42	PROGRAM
43	43	Sec. 487.851. DEFINITIONS. In this subchapter:
44	44	(1) "Microenterprise" means a business in a rural area
45	45	with not more than five employees.
46	46	(2) "Minimum wage" means the minimum wage set by
47	47	federal law as of January 1, 2009.
48	48	(3) "Program" means the rural entrepreneurship and
49	49	business innovation program established under this subchapter.
50	50	(4) "Small business" means a business in a rural area
51	51	with not more than 200 employees.
52	52	Sec. 487.852. PROGRAM. The office shall create a rural
53	53	entrepreneurship and business innovation program to:
54	54	(1) assist in the development and expansion of
55	55	businesses in rural areas;
56	56	(2) assist entrepreneurs in rural areas; and
57	57	(3) recruit out-of-state businesses to locate and
58	58	transact business in rural areas.
59	59	Sec. 487.853. INCENTIVES; LOANS. (a) The program shall
60	60	offer incentives in the form of loans to entrepreneurs and
61	61	businesses for purposes of the creation or retention of jobs in
62	62	rural areas.
63	63	(b) An eligible business or entrepreneur may apply for a
64	64	loan under the program on an application form prescribed by the
65	65	office.
66	66	Sec. 487.854. ELIGIBLE BUSINESS OR ENTREPRENEUR; BORROWING
67	67	REQUIREMENTS. (a) The office may make a loan under the program to
68	68	any of the following eligible businesses or entrepreneurs:
69	69	(1) microenterprises;
70	70	(2) small businesses;
71	71	(3) businesses dependent on natural resources in
72	72	developing value-added products;
73	73	(4) tourism or recreation businesses;
74	74	(5) entrepreneurs and small businesses that provide
75	75	broadband service access to underserved rural areas; and
76	76	(6) projects to develop infrastructure for the benefit
77	77	of entrepreneurs and businesses in rural areas.
78	78	(b) To be eligible to receive a loan under this subchapter,
79	79	the applicant must:
80	80	(1) be in good standing under the laws of the state in
81	81	which the entity was formed or organized, as evidenced by a
82	82	certificate issued by the secretary of state or the state official
83	83	having custody of the records pertaining to entities or other
84	84	organizations formed under the laws of that state; and
85	85	(2) owe no delinquent taxes to a taxing unit of this
86	86	state.
87	87	(c) The office may require a commercial bank letter of
88	88	credit. The office may determine and require other terms and
89	89	conditions, including insurance or a bank guarantee, for the making
90	90	of a loan under the program.
91	91	Sec. 487.855. MAXIMUM LOAN AMOUNT. (a) The maximum loan
92	92	amount to be made by the program is $35,000 for each eligible
93	93	employee position retained or created.
94	94	(b) A loan made by the program may be based on the following
95	95	schedule:
96	96	(1) up to $14,000 for each eligible employee position
97	97	retained or created with wages greater than or equal to 170 percent
98	98	and less than 200 percent of the minimum wage;
99	99	(2) up to $21,000 for each eligible employee position
100	100	retained or created with wages greater than or equal to 200 percent
101	101	and less than 250 percent of the minimum wage;
102	102	(3) up to $28,000 for each eligible employee position
103	103	retained or created with wages greater than or equal to 250 percent
104	104	and less than 300 percent of the minimum wage; and
105	105	(4) up to $35,000 for each eligible employee position
106	106	retained or created with wages greater than or equal to 300 percent
107	107	of the minimum wage.
108	108	Sec. 487.856. RESTRICTION ON USE OF LOAN. A loan may not be
109	109	used to attract a business from another location in this state,
110	110	unless the office determines that the business would otherwise
111	111	leave the state.
112	112	Sec. 487.857. LOAN TERMS. (a) Loan interest rates must be
113	113	based on the capacity of the borrower and the risk of the project,
114	114	as determined by the office.
115	115	(b) Loan interest rates may be as low as one percent.
116	116	Sec. 487.858. WRITTEN AGREEMENT. (a) Before awarding a
117	117	loan under this subchapter, the office shall enter into a written
118	118	agreement with the entity to be awarded the loan money specifying
119	119	that:
120	120	(1) if the office finds that the loan recipient has not
121	121	met each of the performance targets specified in the agreement as of
122	122	a date certain provided in the agreement:
123	123	(A) the recipient shall repay the loan and any
124	124	related interest to the state at the agreed rate and on the agreed
125	125	terms;
126	126	(B) the office will not distribute to the
127	127	recipient any loan money that remains to be awarded under the
128	128	agreement; and
129	129	(C) the office may assess specified penalties for
130	130	noncompliance against the recipient;
131	131	(2) if all or any portion of the amount of the loan is
132	132	used to build a capital improvement, the state may:
133	133	(A) retain a lien or other interest in the
134	134	capital improvement in proportion to the percentage of the loan
135	135	amount used to pay for the capital improvement; and
136	136	(B) require the recipient of the loan, if the
137	137	capital improvement is sold, to:
138	138	(i) repay to the state the loan money used
139	139	to pay for the capital improvement, with interest at the rate and
140	140	according to the other terms provided by the agreement; and
141	141	(ii) share with the state a proportionate
142	142	amount of any profit realized from the sale; and
143	143	(3) if, as of a date certain provided in the agreement,
144	144	the loan recipient has not used loan money awarded under this
145	145	subchapter for the purposes for which the loan was intended, the
146	146	recipient shall repay that amount and any related interest to the
147	147	state at the agreed rate and on the agreed terms.
148	148	(b) The loan agreement may include a provision providing
149	149	that a reasonable percentage of the total amount of the loan will be
150	150	withheld until specified performance targets are met by the entity
151	151	as of the date described by Subsection (a)(1).
152	152	(c) The office shall determine:
153	153	(1) the performance targets and date required to be
154	154	contained in the loan agreement as provided by Subsection (a)(1);
155	155	and
156	156	(2) if the loan agreement includes the provision
157	157	authorized by Subsection (b), the percentage of loan money required
158	158	to be withheld.
159	159	Sec. 487.859. ANNUAL PROGRESS REPORT. An entity entering
160	160	into a loan agreement under Section 487.858 shall submit to the
161	161	office an annual progress report containing the information
162	162	compiled during the previous calendar year regarding the attainment
163	163	of each of the performance targets specified in the agreement.
164	164	Sec. 487.860. REPAYMENT OF LOAN. (a) Repayment of a loan
165	165	under Section 487.858(a)(1)(A) may be prorated to reflect a partial
166	166	attainment of performance targets.
167	167	(b) After repayment of a loan, the office may rebate to the
168	168	borrower an amount to cover fees associated with a commercial bank
169	169	letter of credit and all, or a portion of, the borrower's incidental
170	170	borrowing costs.
171	171	(c) The office may use interest earned on any loans to repay
172	172	any indebtedness related to the program.
173	173	Sec. 487.861. SUPPORT SERVICES. The office may contract to
174	174	provide services to entrepreneurs or businesses for purposes of
175	175	implementing the program.
176	176	Sec. 487.862. CHALLENGE GRANTS. The office may award
177	177	challenge grants under the program to promote the establishment of
178	178	community-based organizations to work in partnership with
179	179	communities in rural areas to assist entrepreneurs through economic
180	180	development efforts in existence at the time of the organization's
181	181	establishment.
182	182	SUBCHAPTER T. RURAL AREA REGIONAL PLANNING AND IMPLEMENTATION
183	183	MATCHING GRANT PROGRAM
184	184	Sec. 487.901. DEFINITION. In this subchapter, "program"
185	185	means the rural area regional planning and implementation matching
186	186	grant program established under this subchapter.
187	187	Sec. 487.902. RURAL AREA REGIONAL PLANNING AND
188	188	IMPLEMENTATION MATCHING GRANT PROGRAM. (a) The office shall
189	189	create the rural area regional planning and implementation matching
190	190	grant program to foster regional collaboration for community and
191	191	economic development in rural areas.
192	192	(b) The office may award matching grants for the planning
193	193	and implementation of regionally identified objectives in a rural
194	194	area.
195	195	Sec. 487.903. ELIGIBLE ENTITIES. (a) To be awarded a
196	196	matching grant under the program for a proposed project, an
197	197	application, including a description of the project proposal, must
198	198	be jointly submitted by two or more of the following entities in the
199	199	form prescribed by the office:
200	200	(1) a municipality;
201	201	(2) a county;
202	202	(3) an economic development corporation;
203	203	(4) a community foundation;
204	204	(5) a faith-based organization;
205	205	(6) a hospital or clinic;
206	206	(7) an institution of higher education, as defined by
207	207	Section 61.003, Education Code; or
208	208	(8) a commission, as defined by Section 391.002, Local
209	209	Government Code.
210	210	(b) Entities that jointly submit an application under
211	211	Subsection (a) must be physically located in at least:
212	212	(1) two or more adjacent rural counties; or
213	213	(2) two or more municipalities or census-designated
214	214	places in a rural county.
215	215	Sec. 487.904. GRANT AWARDS. The office shall give
216	216	preference to eligible applicants that demonstrate an inclusive
217	217	planning and implementation process over other eligible applicants
218	218	for an award of a matching grant under the program.
219	219	SUBCHAPTER U. RURAL CAPACITY AND LEADERSHIP ENHANCEMENT PROGRAM
220	220	Sec. 487.951. DEFINITION. In this subchapter, "program"
221	221	means the rural capacity and leadership enhancement program.
222	222	Sec. 487.952. PROGRAM. The office shall create the rural
223	223	capacity and leadership enhancement program to assist
224	224	municipalities and unincorporated communities in rural areas to:
225	225	(1) develop leadership capacity;
226	226	(2) improve the business practices of municipal
227	227	government;
228	228	(3) increase awareness of the benefits of renewable
229	229	energy;
230	230	(4) identify community assets that can be used to
231	231	enhance community and economic development; and
232	232	(5) provide assistance for emergency services
233	233	districts.
234	234	Sec. 487.953. RURAL LEADERSHIP CURRICULUM. The office may
235	235	coordinate with an interested public junior college or public
236	236	technical institute, as those terms are defined by Section 61.003,
237	237	Education Code, that is located in a rural area or a consortium of
238	238	those colleges or institutes, the Texas Rural Leadership Program,
239	239	or another appropriate leadership program to develop and maintain a
240	240	rural leadership curriculum to implement the program.
241	241	Sec. 487.954. LEADERSHIP TRAINING. The office may award a
242	242	stipend under the program to an individual who completes training
243	243	based on the curriculum developed under Section 487.953.
244	244	SUBCHAPTER V. RURAL COMMUNITY ASSET STUDY MATCHING GRANT PROGRAM
245	245	Sec. 487.1001. DEFINITION. In this subchapter, "program"
246	246	means the rural community asset study matching grant program.
247	247	Sec. 487.1002. RURAL COMMUNITY ASSET STUDY MATCHING GRANT
248	248	PROGRAM. (a) The office shall create the rural community asset
249	249	study matching grant program to assist communities in rural areas
250	250	in identifying community assets.
251	251	(b) The office may issue matching grants to fund community
252	252	asset studies in accordance with criteria established by the
253	253	office.
254	254	Sec. 487.1003. ELIGIBLE ENTITIES. (a) To be awarded a
255	255	matching grant under the program for a proposed project, an
256	256	application, including a description of the project proposal, must
257	257	be jointly submitted by two or more of the following entities in the
258	258	form prescribed by the office:
259	259	(1) a municipality;
260	260	(2) a county;
261	261	(3) an economic development corporation;
262	262	(4) a community foundation;
263	263	(5) a faith-based organization;
264	264	(6) a hospital or clinic;
265	265	(7) an institution of higher education, as defined by
266	266	Section 61.003, Education Code; or
267	267	(8) a commission, as defined by Section 391.002, Local
268	268	Government Code.
269	269	(b) The office shall give preference to eligible applicants
270	270	that demonstrate an inclusive planning and implementation process
271	271	over other eligible applicants for an award of a matching grant
272	272	under the program.
273	273	(c) The office shall develop criteria for eligible projects
274	274	and for the awarding of matching grants under the program.
275	275	SUBCHAPTER W. TEXAS RURAL YOUTH CORPS PROGRAM
276	276	Sec. 487.1051. DEFINITIONS. In this subchapter:
277	277	(1) "Executive director" means the executive director
278	278	of the Office of Rural Community Affairs.
279	279	(2) "Program" means the Texas rural youth corps
280	280	program.
281	281	Sec. 487.1052. TEXAS RURAL YOUTH CORPS PROGRAM. (a) The
282	282	office shall create the Texas rural youth corps program to
283	283	encourage youth participation in civic improvement activities in
284	284	rural areas. The program shall:
285	285	(1) provide youth in rural areas with opportunities to
286	286	acquire job skills while participating in community service
287	287	activities; and
288	288	(2) create opportunities for youth that allow rural
289	289	communities to enhance existing community resources and improve
290	290	economic conditions.
291	291	(b) The office may designate personnel as necessary to
292	292	administer the program.
293	293	Sec. 487.1053. GRANTS. The executive director may award
294	294	grants under the program to eligible entities for projects that
295	295	meet the requirements of this subchapter.
296	296	Sec. 487.1054. ELIGIBLE ENTITIES. (a) Except as provided
297	297	by Subsection (b), the following entities are eligible to submit an
298	298	application as provided by Section 487.1056 to receive a grant for a
299	299	proposed project under this subchapter:
300	300	(1) a nonprofit organization;
301	301	(2) a public agency that operates a community-based
302	302	youth employment training program;
303	303	(3) a community housing development organization
304	304	certified by this state;
305	305	(4) a youth organization;
306	306	(5) a corps-based community service organization; or
307	307	(6) another entity authorized by the office.
308	308	(b) Each eligible applicant that submits an application
309	309	under Subsection (a) must demonstrate that the applicant has at
310	310	least three years of successful experience operating programs for
311	311	the benefit of youth, in particular disadvantaged or at-risk youth
312	312	populations.
313	313	Sec. 487.1055. ELIGIBLE PROJECTS. To receive a grant under
314	314	the program, a proposed project of an eligible applicant must
315	315	provide, by using the services and skills of youth participants who
316	316	are at least 12 years of age but younger than 19 years of age, at
317	317	least one of the following services to the rural community in which
318	318	the project is located:
319	319	(1) rehabilitation or construction of
320	320	energy-efficient, affordable housing for:
321	321	(A) elderly individuals;
322	322	(B) veterans of the United States armed forces;
323	323	or
324	324	(C) low-income individuals and families;
325	325	(2) sustainable construction or rehabilitation of:
326	326	(A) historic properties;
327	327	(B) community facilities;
328	328	(C) business incubators;
329	329	(D) health care facilities;
330	330	(E) cultural districts; or
331	331	(F) parks or cemeteries owned or supported by
332	332	funds of public or nonprofit entities;
333	333	(3) increased access to information on new technology
334	334	and technological advances, including communications or renewable
335	335	energy technologies;
336	336	(4) documentation of community history;
337	337	(5) identification and analysis of community assets
338	338	through a community asset study; and
339	339	(6) marketing services of community assets,
340	340	amenities, and history identified in a community history
341	341	documentation or community asset study.
342	342	Sec. 487.1056. GRANT APPLICATION. A grant application for
343	343	a proposed project must be filed with the office in a form
344	344	prescribed by the office. Each application must include:
345	345	(1) the amount of grant money requested;
346	346	(2) a description of the proposed project;
347	347	(3) a description of the applicant's qualifications,
348	348	including the applicant's experience with youth, educational
349	349	groups, and community groups;
350	350	(4) a list of proposed sites for construction or
351	351	rehabilitation of housing or other buildings, if applicable;
352	352	(5) a description of proposed sustainable
353	353	construction or rehabilitation activities, including an
354	354	implementation schedule, if applicable;
355	355	(6) a description of the applicant's proposed
356	356	procedures for recruiting and selecting participants in the
357	357	project;
358	358	(7) a proposed budget;
359	359	(8) a description of proposed financing, if
360	360	applicable;
361	361	(9) a list of relevant contracts or other arrangements
362	362	between the applicant and public agencies to facilitate project
363	363	implementation;
364	364	(10) a list of prospective donations, grants, or
365	365	in-kind contributions that will supplement grant money received
366	366	under the program; and
367	367	(11) other criteria as considered necessary by the
368	368	office.
369	369	Sec. 487.1057. PROJECT SELECTION; CRITERIA. (a) The
370	370	office shall establish criteria for selecting projects for the
371	371	awarding of a grant under this subchapter.
372	372	(b) In establishing criteria under Subsection (a), the
373	373	office shall:
374	374	(1) give preference to an applicant who can document
375	375	the existence of matching contributions from other sources and
376	376	support from local organizations, community leaders, and elected
377	377	officials; and
378	378	(2) give preference to projects that provide
379	379	participants with an opportunity to earn scholarship awards toward
380	380	college tuition expenses.
381	381	(c) In establishing criteria under Subsection (a), the
382	382	office may:
383	383	(1) give preference to an applicant who has experience
384	384	in providing the services proposed to be provided under the
385	385	project; and
386	386	(2) give preference to projects that assist youths who
387	387	are at least 12 years of age but younger than 19 years of age who:
388	388	(A) are not attending high school and have not
389	389	received a high school diploma or high school equivalency
390	390	certificate; or
391	391	(B) attend high school or a program leading to a
392	392	high school equivalency certificate, but have been identified as
393	393	being at risk of dropping out of high school or the program leading
394	394	to a high school equivalency certificate.
395	395	Sec. 487.1058. ADVISORY BOARD; PARTICIPANT COUNCIL. On
396	396	receipt of a grant under the program, the successful grantees shall
397	397	establish:
398	398	(1) an advisory board for the project that includes:
399	399	(A) senior staff that manage and operate the
400	400	project;
401	401	(B) employers and business and community leaders
402	402	of the community; and
403	403	(C) project participants; and
404	404	(2) a project participant council to provide comments
405	405	and suggestions regarding project policies.
406	406	Sec. 487.1059. ASSISTANCE FOR GRANTEES. The office shall
407	407	provide grantees awarded a grant under the program access to
408	408	curriculum materials created under Section 487.953, in particular
409	409	materials that are designed to develop:
410	410	(1) leadership ethics;
411	411	(2) active citizenship;
412	412	(3) a sense of personal responsibility;
413	413	(4) critical thinking skills;
414	414	(5) decision-making skills;
415	415	(6) problem-solving skills; and
416	416	(7) negotiation skills.
417	417	Sec. 487.1060. OTHER FUNDING SOURCES REQUIRED. Up to 50
418	418	percent of a proposed project's budget must be derived from a source
419	419	other than the award of a grant or other incentive from the office,
420	420	as determined by the office.
421	421	Sec. 487.1061. LIMIT ON ADMINISTRATIVE EXPENSES. A grantee
422	422	may not spend grant money for more than eight percent of a proposed
423	423	project's administrative costs.
424	424	Sec. 487.1062. REPORTING REQUIREMENT. The office must
425	425	include the following information regarding the program in its
426	426	biennial report to the legislature under Section 487.056:
427	427	(1) the total number of grants and the total amount of
428	428	grant money awarded under the program;
429	429	(2) the geographical distribution of grants awarded;
430	430	and
431	431	(3) the number of youth and other persons
432	432	participating in program-funded projects.
433	433	SUBCHAPTER X. RURAL WEALTH CREATION AND RETENTION PROGRAM
434	434	Sec. 487.1101. DEFINITION. In this subchapter, "program"
435	435	means the rural wealth creation and retention program.
436	436	Sec. 487.1102. RURAL WEALTH CREATION AND RETENTION PROGRAM.
437	437	The office shall create a rural wealth creation and retention
438	438	program to assist rural communities in:
439	439	(1) identifying community wealth;
440	440	(2) educating residents about the benefits of
441	441	charitable giving; and
442	442	(3) encouraging the creation of community foundations
443	443	in those areas to build sustainable local wealth and decrease
444	444	long-term dependence on state and federal resources.
445	445	Sec. 487.1103. CONTRACT FOR SERVICES. (a) The office may
446	446	contract with other entities to provide services under the program.
447	447	(b) In making a decision to contract with an entity under
448	448	Subsection (a), the office shall give preference to an entity with a
449	449	proven history of providing assistance to community foundations.
450	450	Sec. 487.1104. SUPPORT SERVICES. The office, or a
451	451	contracting entity under Section 487.1103, may provide support
452	452	services for the implementation of the program, including financial
453	453	management, strategic development, and education training.
454	454	Sec. 487.1105. FEE. The office, or a contracting entity
455	455	under Section 487.1103, may charge a fee for services provided
456	456	under the program. The amount of the fee shall be determined by the
457	457	office.
458	458	SECTION 4. Not later than March 1, 2010, the board of the
459	459	Office of Rural Community Affairs shall adopt any necessary rules
460	460	for the fund established under Subchapter R, Chapter 487,
461	461	Government Code, as added by this Act, and the programs established
462	462	under Subchapters S through X, Chapter 487, Government Code, as
463	463	added by this Act.
464	464	SECTION 5. Implementation of the programs established under
465	465	Subchapters S through X, Chapter 487, Government Code, as added by
466	466	this Act, is contingent on appropriation of funding by the
467	467	legislature.
468	468	SECTION 6. This Act does not make an appropriation. A
469	469	provision in this Act that creates a new governmental program,
470	470	creates a new entitlement, or imposes a new duty on a governmental
471	471	entity is not mandatory during a fiscal period for which the
472	472	legislature has not made a specific appropriation to implement the
473	473	provision.
474	474	SECTION 7. This Act takes effect immediately if it receives
475	475	a vote of two-thirds of all the members elected to each house, as
476	476	provided by Section 39, Article III, Texas Constitution. If this
477	477	Act does not receive the vote necessary for immediate effect, this
478	478	Act takes effect September 1, 2009.