HBA-JEK H.B. 2888 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2888 By: Truitt Public Education 4/10/2001 Introduced BACKGROUND AND PURPOSE Although there are approximately 1,000 school districts in the state of Texas most of the growth in student enrollment has occurred in approximately 10% of the state's school districts during the past five years. These fast-growth districts face strong financial pressures. Most fast-growth school districts finance the expansion of their facilities through voted bond issues. Current law provides that the interest and sinking fund (I&S) tax rate for all bonds that a school district issues after September 1, 1992, must not exceed fifty cents per $100 of valuation. This "fifty cent test" has limited the ability of some fast-growth school districts to expand their facilities. House Bill 2888 repeals the provision that prohibits the principal of and interest on school district bonds from exceeding the revenue generated by a tax at $0.50 per $100 of valuation. 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 2888 amends the Education Code to repeal the provision that, before issuing bonds, a district must demonstrate to the attorney general that the district has a projected ability to pay the principal of and interest on proposed bonds and previously issued bonds from a tax at a rate not to exceed $0.50 per $100 of valuation. EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.