HBA-MPA C.S.H.B. 1543 76(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 1543
By: Keffer
Economic Development
3/18/1999
Committee Report (Substituted)


BACKGROUND AND PURPOSE 

Currently, 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. 

An individual must be a "city resident" to qualify to serve as a director
of a 4B development corporation.  This contrasts with the qualifications
for a 4A development corporation, which is not limited to residents of the
city.  This requirement can be burdensome for small rural communities in
which many of the business owners and those with a stake in the community
do not actually reside within the city limits.  These persons are currently
disqualified from serving on a 4B development corporation board, limiting
the availability of qualified candidates.  C.S.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 the person lives either
in the city that created the corporation or in the county where the
majority of the city is located. 

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 10,000 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 than10,000 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.


COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 1543 differs from the original bill in SECTION 1 by specifying
that in eligible cities with a population of 10,000 or more each director
of an industrial development corporation organized under this section must
be a resident of the city, but in a city with a population less than 10,000
a director must be a resident of the city or the county in which the
largest part of the city is located. The original bill deleted the
requirement that each director be a resident of the eligible city. 

C.S.H.B. 1543 differs from the original bill in SECTION 2 by adding an
effective date of September 1, 1999.  Redesignates SECTION 2 to SECTION 3.