Texas 2011 - 82nd Regular

Texas House Bill HB3140 Compare Versions

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1	1	82R22002 TJB-F
2	2	By: Paxton H.B. No. 3140
3	3	Substitute the following for H.B. No. 3140:
4	4	By: Vo C.S.H.B. No. 3140
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to the authority of certain municipalities to create
10	10	economic development programs and provide loans or grants for those
11	11	programs; providing authority to issue bonds.
12	12	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	13	SECTION 1. Chapter 1509, Government Code, is amended by
14	14	adding Subchapter F to read as follows:
15	15	SUBCHAPTER F. REVENUE BONDS FOR ECONOMIC DEVELOPMENT PROGRAMS
16	16	Sec. 1509.251. APPLICABILITY OF SUBCHAPTER. This
17	17	subchapter applies only to a municipality located in a county with a
18	18	population of 750,000 or more that is adjacent to a county that
19	19	borders Oklahoma.
20	20	Sec. 1509.252. PUBLIC PURPOSE. This subchapter provides
21	21	for the creation of one or more programs authorized under Section
22	22	52-a, Article III, Texas Constitution, including the following
23	23	public purposes:
24	24	(1) the development and diversification of the economy
25	25	of this state;
26	26	(2) the elimination of unemployment or
27	27	underemployment in this state; and
28	28	(3) the development or expansion of commerce in this
29	29	state.
30	30	Sec. 1509.253. ECONOMIC DEVELOPMENT PROGRAM; LOANS AND
31	31	GRANTS. (a) A municipality may establish and provide for the
32	32	administration of one or more programs for loans and grants of
33	33	money, including the proceeds of revenue bonds authorized under
34	34	this subchapter, to a private entity for use in the promotion of new
35	35	manufacturing, industrial, retail, commercial, multifamily
36	36	residential, or other business activity or the expansion of that
37	37	business activity, including a project for purposes of that
38	38	promotion or expansion.
39	39	(b) To accomplish a purpose under Section 1509.252, a
40	40	municipality may, under the terms and by the methods the
41	41	municipality may determine:
42	42	(1) acquire land; and
43	43	(2) construct or acquire a building or other facility
44	44	for the purpose of selling or leasing the land, building, or other
45	45	facility to a private entity receiving a loan or grant under this
46	46	section.
47	47	Sec. 1509.254. AUTHORITY TO ISSUE REVENUE BONDS. (a) A
48	48	municipality may issue and sell revenue bonds to finance an action
49	49	under Section 1509.253 taken to accomplish a public purpose under
50	50	Section 1509.252.
51	51	(b) Bonds issued under this subchapter are not general
52	52	obligations of the municipality if no tax revenue or other general
53	53	revenue of the municipality is pledged to the repayment of the
54	54	bonds.
55	55	Sec. 1509.255. PROGRAM AGREEMENT REQUIRED. (a) A
56	56	municipality may not loan or grant money under this subchapter to a
57	57	private entity for a project or activity authorized under Section
58	58	1509.253 unless the municipality enters into a program agreement
59	59	with the entity.
60	60	(b) A program agreement under this section must include:
61	61	(1) the terms under which the municipality will loan
62	62	or grant the money to the entity;
63	63	(2) a provision requiring that a revenue bond issued
64	64	by the municipality under this subchapter:
65	65	(A) is secured by the credit of the private
66	66	entity, by funds, revenue, or assets pledged by one or more
67	67	investors for the project, or by a combination of both;
68	68	(B) is additionally secured by an encumbrance or
69	69	mortgage on any real or personal property acquired, constructed, or
70	70	improved with the proceeds of the revenue bond; and
71	71	(C) is the obligation of the private entity and
72	72	not of the municipality if no municipal revenue is pledged for
73	73	repayment of the bonds;
74	74	(3) a description of and the amount of the capital
75	75	investment that will be made by the entity in this state for the
76	76	project or activity;
77	77	(4) a schedule of the number and types of jobs that
78	78	will be created or retained as a result of the project or activity;
79	79	(5) a provision requiring repayment of the loan or
80	80	grant or other penalty to be imposed on the entity if the entity
81	81	does not meet the job creation or other requirements specified in
82	82	the program agreement;
83	83	(6) the estimated increase in tax revenue from all
84	84	sources to the municipality as a result of the project or activity,
85	85	calculated by the municipality;
86	86	(7) the designated area where the project or activity
87	87	will be located; and
88	88	(8) a provision prohibiting the entity from using a
89	89	loan or grant for:
90	90	(A) a project or activity involving a gambling,
91	91	gaming, or adult entertainment enterprise or facility; or
92	92	(B) an expenditure for which reporting is
93	93	required under Chapter 305.
94	94	(c) A municipality may enter into not more than two program
95	95	agreements.
96	96	(d) A municipality may not enter into a program agreement
97	97	with an entity after December 31, 2015.
98	98	(e) A program agreement is subject to Chapter 552.
99	99	Sec. 1509.256. REVENUE BOND PAYMENTS. (a) Revenue bonds
100	100	issued by a municipality under this subchapter may be payable from
101	101	and secured by pledging:
102	102	(1) all or part of revenue received by the
103	103	municipality from a loan made as provided by Section 1509.253;
104	104	(2) a portion of revenue collected by the municipality
105	105	under Section 321.101(a), Tax Code, not to exceed the lesser of:
106	106	(A) one percent of the revenue collected by the
107	107	municipality; or
108	108	(B) one-half of the revenue collected by the
109	109	municipality from the area designated in the applicable program
110	110	agreement;
111	111	(3) all or part of revenue authorized for the payment
112	112	of bonds under Section 351.102(a), Tax Code;
113	113	(4) all or part of revenue from the sale or lease of
114	114	all or part of the land, building, or other facility financed by the
115	115	bonds; or
116	116	(5) any combination of the revenue described by
117	117	Subdivisions (1)-(4).
118	118	(b) A municipality may provide that the revenue pledged to
119	119	the bonds issued by the municipality is limited to the revenue
120	120	collected from a designated area within the municipality or from a
121	121	designated facility.
122	122	Sec. 1509.257. ADDITIONAL SECURITY. (a) Bonds issued
123	123	under this subchapter must be additionally secured by an
124	124	encumbrance or mortgage on any real or personal property acquired,
125	125	constructed, or improved with proceeds of bonds or the proceeds of a
126	126	loan or grant made from proceeds of bonds.
127	127	(b) Bonds issued by a municipality under this subchapter may
128	128	be additionally secured by a pledge of any portion of a grant, a
129	129	donation, or revenue, or income received or to be received from the
130	130	United States or any other public or private source, other than the
131	131	municipality itself.
132	132	Sec. 1509.258. CONTENTS OF ORDINANCE, ORDER, OR RESOLUTION
133	133	AUTHORIZING BONDS. In an ordinance, order, or resolution
134	134	authorizing the issuance of bonds under this subchapter, the
135	135	governing body of a municipality may:
136	136	(1) provide for the deposit and accounting of money;
137	137	(2) provide for the establishment and maintenance of
138	138	an interest and sinking fund, a reserve fund, or other funds
139	139	relating to the bonds or a project funded with bond proceeds; and
140	140	(3) make additional covenants relating to the bonds,
141	141	the pledged revenue, or the operation and maintenance of any land,
142	142	building, or other facility the revenue of which is pledged for bond
143	143	payments.
144	144	Sec. 1509.259. USE OF BOND PROCEEDS. Proceeds of bonds
145	145	issued under this subchapter may be used to:
146	146	(1) pay interest on the bonds while the project or
147	147	facility is being acquired, constructed, or improved and for the
148	148	year after it is acquired, constructed, or improved;
149	149	(2) finance other funds relating to the bonds,
150	150	including debt service reserve and contingency; and
151	151	(3) pay the cost or expense of the issuance of the
152	152	bonds.
153	153	Sec. 1509.260. MATURITY. Bonds issued under this
154	154	subchapter must mature not later than 40 years after the date the
155	155	bonds are issued.
156	156	Sec. 1509.261. APPLICATION OF OTHER LAW. The provisions of
157	157	Chapter 252, Local Government Code, regarding notice, competitive
158	158	bids, and the right to referendum do not apply to a municipality
159	159	issuing bonds under this subchapter.
160	160	Sec. 1509.262. CONFLICT OR INCONSISTENCY WITH OTHER LAW.
161	161	To the extent of a conflict or inconsistency between this
162	162	subchapter and another law, this subchapter controls.
163	163	Sec. 1509.263. CONSTRUCTION OF SUBCHAPTER; CORRECTION OF
164	164	INVALID PROCEDURES. (a) This subchapter may not be construed or
165	165	interpreted to violate either the constitution of this state or of
166	166	the United States, and this subchapter does not authorize an act
167	167	that violates those constitutions.
168	168	(b) If a court finds that any provision of this subchapter
169	169	violates the constitution of this state or of the United States:
170	170	(1) a municipality may establish an alternative
171	171	procedure that conforms with the constitution; and
172	172	(2) the validity of any other provision of this
173	173	subchapter is not affected.
174	174	SECTION 2. Section 321.506, Tax Code, is amended to read as
175	175	follows:
176	176	Sec. 321.506. USE OF TAX REVENUE BY MUNICIPALITY. Except as
177	177	provided by Sections [Section] 321.507 and 321.5071, the money
178	178	received by a municipality under this chapter is for the use and
179	179	benefit of the municipality and may be used for any purpose for
180	180	which the general funds of the municipality may be used, except that
181	181	a municipality may not pledge the revenue received under this
182	182	chapter to the payment of bonds or other indebtedness.
183	183	SECTION 3. Subchapter F, Chapter 321, Tax Code, is amended
184	184	by adding Section 321.5071 to read as follows:
185	185	Sec. 321.5071. USE OF TAX REVENUE BY CERTAIN MUNICIPALITIES
186	186	FOR BONDS FOR ECONOMIC DEVELOPMENT PROGRAMS. A municipality to
187	187	which Subchapter F, Chapter 1509, Government Code, applies may use
188	188	money received by the municipality under this chapter to provide
189	189	for the payment, in the manner provided by that subchapter, of the
190	190	principal of or interest on bonds issued by the municipality as
191	191	authorized by that subchapter.
192	192	SECTION 4. Section 351.102, Tax Code, is amended by adding
193	193	Subsection (d) to read as follows:
194	194	(d) A municipality to which Subchapter F, Chapter 1509,
195	195	Government Code, applies may use money received by the municipality
196	196	under this chapter to provide for the payment, in the manner
197	197	provided by that subchapter, of the principal of or interest on
198	198	bonds issued by the municipality as authorized by that subchapter.
199	199	SECTION 5. This Act takes effect immediately if it receives
200	200	a vote of two-thirds of all the members elected to each house, as
201	201	provided by Section 39, Article III, Texas Constitution. If this
202	202	Act does not receive the vote necessary for immediate effect, this
203	203	Act takes effect September 1, 2011.