HBA-ATS, MPA H.B. 1543 76(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 1543 By: Keffer Economic Development 10/5/1999 Enrolled BACKGROUND AND PURPOSE Under Texas law, a 4A development corporation may only be established in a city with a population under 50,000 or a county with a population of 500,000 or less. A 4B development corporation may only be established in a city with a population over 400,000 or a county with a population of 750,000 or more. Both entities were created by the Development Corporation Act of 1979 (Article 5190.6, V.T.C.S.). The population restrictions set out in the Act have been changed by the legislature over time. Some corporations classified as 4A and 4B corporations would not qualify as a 4A and 4B under the current guidelines. Prior to the 76th Legislature, an individual had to be a "city resident" to qualify to serve as a director of a 4B development corporation. In contrast, to qualify to serve as a director of a 4A development corporation, an individual was, and is, not required to reside in the city. The requirement to reside in the city was burdensome for small rural communities in which many of the business owners and those with a stake in the community did not actually reside within the city limits. These persons were disqualified from serving on a 4B development corporation board, limiting the availability of qualified candidates. H.B. 1543 changes the requirements so that a person may serve on the board of directors of a development corporation created under Section 4B if that person lives either in the city that created the corporation or in the county where the majority of the city is located, so long as the eligible city has a population less than 20,000. Each director of an industrial development corporation created by an eligible city with a population of 20,000 or more must be a resident of the city. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 4B(c), Article 5190.6, V.T.C.S. (Development Corporation Act of 1979), to provide that each director of an industrial development corporation organized under this section created by an eligible city with a population of 20,000 or more must be a resident of the city. Provides that each director of an industrial development corporation organized under this section created by an eligible city with a population of less than 20,000 must be a resident of the city or the county in which the major part of the eligible city is located. SECTION 2. Effective date: September 1, 1999. SECTION 3. Emergency clause.