84R17183 DDT-D
By: Johnson H.B. No. 1626
Substitute the following for H.B. No. 1626:
By: Longoria C.S.H.B. No. 1626
A BILL TO BE ENTITLED
AN ACT
relating to the designation of certain areas as banking or credit
union development districts to encourage the establishment of
branches of banks or credit unions in those areas.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle Z, Title 3, Finance Code, is amended by
adding Chapter 279 to read as follows:
CHAPTER 279. BANKING AND CREDIT UNION DEVELOPMENT DISTRICTS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 279.001. DEFINITIONS. In this chapter:
(1) "Credit union" means a state or federal credit
union.
(2) "Finance commission" means the Finance Commission
of Texas.
(3) "Financial institution" means a state or national
bank, a state or federal savings bank, or a state or federal savings
and loan association.
(4) "Local government" means a municipality or county.
SUBCHAPTER B. BANKING DEVELOPMENT DISTRICTS
Sec. 279.051. ADMINISTRATION OF PROGRAM. The finance
commission shall administer and monitor a banking development
district program under this chapter to encourage the establishment
of branches of a financial institution in geographic areas where
there is a demonstrated need for banking services.
Sec. 279.052. RULES. (a) Subject to Subsection (b), the
finance commission shall adopt rules to implement this subchapter
and Subchapters D and E with respect to financial institutions in
banking development districts.
(b) The finance commission, in consultation with the Texas
Economic Development and Tourism Office, shall adopt rules
regarding the criteria for the designation of banking development
districts under this subchapter. The rules must require the
finance commission to consider:
(1) the location, number, and proximity of sites where
banking services are available in the proposed banking development
district;
(2) consumer needs for banking services in the
proposed district;
(3) the economic viability and local credit needs of
the community in the proposed district;
(4) the existing commercial development in the
proposed district; and
(5) the impact additional banking services would have
on potential economic development in the proposed district.
Sec. 279.053. APPLICATION FOR DESIGNATION OF BANKING
DEVELOPMENT DISTRICT. A local government, in conjunction with a
financial institution, may submit an application to the finance
commission for the designation of a banking development district.
Sec. 279.054. APPLICATION BY FINANCIAL INSTITUTION TO OPEN
BRANCH IN DISTRICT. A financial institution may apply to open a
branch in the proposed banking development district at the time the
local government submits an application in conjunction with the
institution under Section 279.053.
Sec. 279.055. DETERMINATION BY FINANCE COMMISSION. (a)
Not later than the 120th day after the date an application for the
designation of a banking development district is submitted under
Section 279.053, the finance commission shall make a determination
regarding whether to approve the application.
(b) If the finance commission approves the application, the
finance commission shall notify the:
(1) local government;
(2) financial institution;
(3) comptroller;
(4) Texas Economic Development and Tourism Office;
(5) lieutenant governor; and
(6) speaker of the house of representatives.
SUBCHAPTER C. CREDIT UNION DEVELOPMENT DISTRICTS
Sec. 279.101. ADMINISTRATION OF PROGRAM. The Credit Union
Commission shall administer and monitor a credit union development
district program under this chapter to encourage the establishment
of branches of a credit union in geographic areas where there is a
demonstrated need for services provided by a credit union.
Sec. 279.102. RULES. (a) Subject to Subsection (b), the
Credit Union Commission shall adopt rules to implement this
subchapter and Subchapters D and E with respect to credit unions in
credit union development districts.
(b) The Credit Union Commission, in consultation with the
Texas Economic Development and Tourism Office, shall adopt rules
regarding the criteria for the designation of credit union
development districts under this subchapter. The rules must
require the Credit Union Commission to consider:
(1) the location, number, and proximity of sites where
services provided by a credit union are available in the proposed
credit union development district;
(2) consumer needs for services provided by a credit
union in the proposed district;
(3) the economic viability and local credit needs of
the community in the proposed district;
(4) the existing commercial development in the
proposed district; and
(5) the impact additional services provided by a
credit union would have on potential economic development in the
proposed district.
Sec. 279.103. APPLICATION FOR DESIGNATION OF CREDIT UNION
DEVELOPMENT DISTRICT. A local government, in conjunction with a
credit union, may submit an application to the Credit Union
Commission for the designation of a credit union development
district.
Sec. 279.104. APPLICATION BY CREDIT UNION TO OPEN BRANCH IN
DISTRICT. A credit union may apply to open a branch in the proposed
credit union development district at the time the local government
submits an application in conjunction with the credit union under
Section 279.103.
Sec. 279.105. DETERMINATION BY CREDIT UNION COMMISSION.
(a) Not later than the 120th day after the date an application for
the designation of a credit union development district is submitted
under Section 279.103, the Credit Union Commission shall make a
determination regarding whether to approve the application.
(b) If the Credit Union Commission approves the
application, the Credit Union Commission shall notify the:
(1) local government;
(2) credit union;
(3) comptroller;
(4) Texas Economic Development and Tourism Office;
(5) lieutenant governor; and
(6) speaker of the house of representatives.
SUBCHAPTER D. DEPOSIT OF PUBLIC FUNDS IN DISTRICT DEPOSITORY
Sec. 279.151. DESIGNATION OF DISTRICT DEPOSITORY. (a) The
governing body of a local government in which a banking development
district has been designated under Subchapter B may by resolution
designate a financial institution located in the district as a
banking district depository for purposes of this subchapter.
(b) The governing body of a local government in which a
credit union development district has been designated under
Subchapter C may by resolution designate a credit union located in
the district as a credit union district depository for purposes of
this subchapter.
(c) A resolution adopted under Subsection (a) or (b) must
specify the maximum amount that may be kept on deposit with the
banking district or credit union district depository, as
appropriate.
(d) In calculating the yield under Section 2256.006,
Government Code, of public funds deposited in a banking district or
credit union district depository, the governing body of a local
government may consider the benefit to this state of stimulating
economic development.
Sec. 279.152. DEPOSIT OF PUBLIC FUNDS BY LOCAL GOVERNMENT.
(a) A local government may deposit public funds with a financial
institution designated as a banking district depository or a credit
union designated as a credit union district depository under
Section 279.151 regardless of whether the financial institution or
credit union is designated by the comptroller as a state depository
under Subchapter C, Chapter 404, Government Code.
(b) Subject to an agreement between the governing body and
the banking district or credit union district depository, public
funds deposited in the district depository may earn a fixed
interest rate that is at or below the financial institution's or
credit union's posted two-year certificate of deposit rate, as
appropriate. The terms of the agreement must be specified in the
applicable resolution adopted under Section 279.151.
Sec. 279.153. DEPOSIT OF PUBLIC FUNDS BY STATE. (a) If the
comptroller designates the financial institution as a state
depository under Subchapter C, Chapter 404, Government Code, the
comptroller may deposit public funds with a financial institution
designated as a banking district depository under Section
279.151(a).
(b) If the comptroller designates the credit union as a
state depository under Subchapter C, Chapter 404, Government Code,
the comptroller may deposit public funds with a credit union
designated as a credit union district depository under Section
279.151(b).
(c) For purposes of Subsections (a) and (b), a financial
institution or credit union is subject to the collateral
requirements of Section 404.031, Government Code.
(d) Subject to an agreement between the comptroller and the
banking district or credit union district depository, public funds
deposited in the district depository may earn a fixed interest rate
that is at or below the financial institution's or credit union's
posted two-year certificate of deposit rate, as appropriate.
(e) In calculating the yield under Section 2256.006,
Government Code, of public funds deposited in a banking district or
credit union district depository, the comptroller may consider the
benefit to this state of stimulating economic development.
SUBCHAPTER E. BANKING OR CREDIT UNION DISTRICT BENEFITS
Sec. 279.201. TAX ABATEMENT. The governing body of a local
government may enter into a tax abatement agreement as provided by
Chapter 312, Tax Code, with:
(1) a financial institution that owns property in a
banking development district on which the institution proposes to
open a branch of the institution; or
(2) a credit union that owns property in a credit union
development district on which the credit union proposes to open a
branch of the credit union.
SECTION 2. Subchapter B, Chapter 312, Tax Code, is amended
by adding Section 312.2012 to read as follows:
Sec. 312.2012. BANKING OR CREDIT UNION DEVELOPMENT
DISTRICT. (a) In this section, "financial institution" and
"credit union" have the meanings assigned by Section 279.001,
Finance Code.
(b) The designation of an area as a banking development
district or credit union development district under Chapter 279,
Finance Code, constitutes designation of the area as a reinvestment
zone under this subchapter without further hearing or other
procedural requirements other than those provided by Chapter 279,
Finance Code. Except as otherwise provided by this section, the
provisions of this subchapter apply to the abatement of taxes on
property located in a banking or credit union development district.
(c) Only the governing body of a municipality or county is
eligible to enter into a tax abatement agreement with an owner of
property located:
(1) in a banking development district so long as the
property is owned by a financial institution; or
(2) in a credit union development district so long as
the property is owned by a credit union.
(d) The governing body of a municipality or county may enter
into an agreement with:
(1) a financial institution to abate taxes on property
owned by the institution that is located in a banking development
district only on the condition that the institution open a branch on
the property; or
(2) a credit union to abate taxes on property owned by
the credit union that is located in a credit union development
district only on the condition that the credit union open a branch
on the property.
(e) The designation of an area as a reinvestment zone under
this section is for purposes of this subchapter only and not for
purposes of any other law, including Chapters 311 and 313.
SECTION 3. Subchapter C, Chapter 312, Tax Code, is amended
by adding Section 312.4012 to read as follows:
Sec. 312.4012. BANKING OR CREDIT UNION DEVELOPMENT
DISTRICT. (a) In this section, "financial institution" and
"credit union" have the meanings assigned by Section 279.001,
Finance Code.
(b) The designation of an area as a banking or credit union
development district under Chapter 279, Finance Code, constitutes
designation of the area as a reinvestment zone under this
subchapter without further hearing or other procedural
requirements other than those provided by Chapter 279, Finance
Code. Except as otherwise provided by this section, the provisions
of this subchapter apply to the abatement of taxes on property
located in a banking or credit union development district.
(c) Only the governing body of a county is eligible to enter
into a tax abatement agreement with an owner of property located:
(1) in a banking development district so long as the
property is owned by a financial institution; or
(2) in a credit union development district so long as
the property is owned by a credit union.
(d) The governing body of a county may enter into an
agreement with:
(1) a financial institution to abate taxes on property
owned by the institution that is located in a banking development
district only on the condition that the institution open a branch on
the property; or
(2) a credit union to abate taxes on property owned by
the credit union that is located in a credit union development
district only on the condition that the credit union open a branch
on the property.
(e) The designation of an area as a reinvestment zone under
this section is for purposes of this subchapter only and not for
purposes of any other law, including Chapters 311 and 313.
SECTION 4. Not later than January 1, 2016, the Finance
Commission of Texas shall adopt rules governing the designation of
banking development districts, as required by Subchapter B, Chapter
279, Finance Code, as added by this Act.
SECTION 5. Not later than January 1, 2016, the Credit Union
Commission shall adopt rules governing the designation of credit
union development districts, as required by Subchapter C, Chapter
279, Finance Code, as added by this Act.
SECTION 6. 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, 2015.