HBA-TYH H.B. 951 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 951
By: Isett
Economic Development
2/24/1999
Introduced



BACKGROUND AND PURPOSE 

Article 5190.6, V.T.C.S. (Development Corporation Act of 1979), allows for
the creation of economic development corporations by municipalities.  These
corporations are commonly referred to as 4A and 4B corporations, and the
difference between the two consists of the types of projects allowed.
Currently, citizens can initiate a petition to dissolve a 4A corporation.
If such a petition is signed by at least 10 percent of a city's voters, the
city will hold an election regarding the dissolution of the corporation.
There is no similar provision for a 4B corporation.  H.B. 951 makes the
dissolution provision the same for 4A and 4B corporations by providing for
a citizen petition and a subsequent election to dissolve a 4B corporation.  

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, Development Corporation Act of 1979 (Article
5190.6, V.T.C.S.), by adding Subsection (o), as follows: 

(o)(1)  Requires the governing body of a city creating a corporation under
this section to order an election on the dissolution of the corporation  on
receipt of a petition requesting the election that is signed by at least 10
percent of the registered voters of the city.  Provides that the election
must be held on the first available uniform election date that occurs on or
after the 45th day after the date the petition is filed with the city.  
  
(2) Requires the ballot to be printed to permit voting for or against the
proposition at the election.  Sets forth the required language for the
ballot. 
  
(3)  Requires the corporation to continue operations only as necessary to
meet obligations the corporation incurred before the date of the election,
if a majority of the votes cast are in favor of the dissolution.  Requires
the corporation to liquidate assets of the corporation and apply the
proceeds to satisfy the corporation's obligations. Requires any remaining
assets of the corporation to be transferred to the city after all of the
obligations are satisfied, and provides that the corporation is dissolved.
Requires the city to promptly notify the comptroller of the date a
corporation is dissolved. 

(4)  Prohibits a tax imposed under this section to be collected after the
last day of the first calendar quarter that begins after the city provides
notice under Subdivision (3).  
  
(5)  Provides that if less than a majority of the votes cast at the
election favor the dissolution, Subdivisions (3) and (4) of this subsection
have no effect.  

SECTION 2.Effective date: September 1, 1999.

SECTION 3.Emergency clause.