HBA-BSM, MPM H.B. 282 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 282
By: Homer
Economic Development
4/2/2001
Introduced



BACKGROUND AND PURPOSE 

Under the Development Corporation Act of 1979, local businesses collect the
tax levied for use by industrial development corporations (IDC) to recruit
new businesses to the local area.  Currently, an IDC may use these funds to
bring a competing business into the local area under terms which may create
an unequal playing field with the original businesses.  House Bill 282
prohibits an IDC from selling an asset at a cost lower than the IDC
invested in the asset to a new business enterprise that would compete with
an existing local business.  

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. 

ANALYSIS

House Bill 282 amends the Development Corporation Act of 1979 to prohibit a
4B industrial development corporation (IDC) from selling an asset for less
than the amount invested by the IDC to a business enterprise that has not
previously done business within the boundaries of the city that created the
IDC and that would directly compete with an existing business located
within the boundaries of the city that created the IDC.  A sale which
violates this provision is void. 

EFFECTIVE DATE

September 1, 2001.