HBA-GUM C.S.S.B. 1862 76(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.S.B. 1862
By: Ratliff
Ways & Means
5/14/1999
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently, the Texas Water Development Board (board) lacks the authority to
charge an administrative cost recovery fee to borrowers of the State
Participation Program, which authorizes the state to purchase an interest,
not to exceed 50 percent, in certain projects to accommodate future growth.
In other infrastructure financing programs, such as the board's State
Revolving Fund programs, administrative cost recovery fees are charged to
participants in order to fully recover the state's administrative costs.
C.S.S.B. 1862 authorizes the board to recover administrative costs incurred
in making and administering certain agreements and projects. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Texas Water Development Board in
SECTION 1 (Section 16.142, Water Code) of this bill.  

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter E, Chapter 16, Water Code, by adding Section
16.142, as follows:  

Sec. 16.142.  RECOVERY OF ADMINISTRATIVE COSTS.  (a)  Authorizes the Texas
Water Development Board (board) to charge an administrative fee to a
political subdivision with which the board agrees to participate in a
project under this subchapter (Acquisition and Development of Facilities).

(b)  Requires the board, by rule, to set the fee at an amount necessary to
recover all costs incurred or to be incurred in administering the project
over its life.  Requires the state auditor to review fees charged by the
board to determine whether the fees are set consistent with this
subsection.   

(c)  Authorizes the board to require the payment of the fee to be in one or
more payments.  
(d)  Requires the fees to be deposited as directed by the board for use in
administering the program.  

SECTION 2. Effective date: September 1, 1999.

SECTION 3. Emergency clause.

COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute modifies proposed Section 16.142(b) in SECTION 1 by
requiring the state auditor to review fees charged by the board to
determine whether the fees are set consistent with that section.