HBA-SEB H.J.R. 9 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.J.R. 9
By: Burnam
Pensions and Investments
4/7/1999
Introduced



BACKGROUND AND PURPOSE 

Federal funding for low income housing dropped from $71.2 billion in 1978
to $16.3 billion in 1997. In search of a way to raise funds for low income
housing, the Texas Intergovernmental Task Force on Housing Investment
investigated the possibility of investing statewide pension money in
affordable housing.  The task force rejected the possibility because the
Texas Constitution prohibits social investment.  

As proposed, H.J.R. 9 requires the submission to the voters of a
constitutional amendment requiring the board of trustees of the Texas
growth fund II to invest not more than one percent of the fund in low
income housing. 

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 67(a)(3), Article XVI, Texas Constitution, to
provide that each statewide benefits system must have a board of trustees
to administer the system and to invest the funds of the system in such
investments, rather than securities, as the board may consider prudent. 

SECTION 2.  Amends Sections 70(a)(1) and (2), Article XVI, Texas
Constitution, to include the board of trustees of Texas growth fund II in
the definition of "board of trustees," along with the board of trustees of
Texas growth fund.  Includes  Texas growth fund II in the definition of
"fund," along with Texas growth fund. 

SECTION 3.  Amends Sections 70(b), (g), (j), and (k), Article XVI, Texas
Constitution, as follows: 

(b)  Makes a conforming change.

(g)  Provides that Subsection (j) is an exception to this subsection, which
requires all investments of the fund to be directly related to the
creation, retention, or expansion of employment opportunity and economic
growth in Texas. 

(j)  Requires the board of trustees to establish criteria for the
investment of not more than one percent of the fund in low-income housing.

(k)  Makes conforming changes.

SECTION 4.  Requires this proposed constitutional amendment to be submitted
to the voters at an election to be held on November 2, 1999.  Sets forth
the required language for the ballot.