HBA-DMH H.B. 3436 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3436 By: Isett State, Federal & International Relations 4/9/2001 Introduced BACKGROUND AND PURPOSE The Lubbock Reese Redevelopment Authority (authority) serves as the governing body for the Reese Technology Center (center), also known as the former Reese Air Force Base. The enabling statute creating the authority was amended by the 76th Legislature to provide for more effective administration and maintenance of utilities and other infrastructure on the property. Certain provisions required the Public Utility Commission of Texas, by September 1, 2001, to perform an electric utility infrastructure value assessment of the center. Such a value, as determined by the assessment, was to serve as a required minimum value for the purposes of considering any bids for the sale of the electricity infrastructure. It has since been estimated by the authority and certain business entities operating or considering establishing operations at the center that, because of the deteriorating condition of the infrastructure and the technologically advanced focus of several of the entities at the center, the market value of the infrastructure will likely be much lower than any book value assigned to it. House Bill 3436 requires the authority to have the power to contract to convey property relating to the electric utility infrastructure to any neighboring municipality or other utility providers that require such conveyance as a condition of upgrading the electric utility infrastructure. 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 3436 amends the Local Government Code to require the Lubbock Reese Redevelopment Authority (authority) to continue to be served by the current provider of electricity and related services until a delegation of the provision of electric services is made by the authority, rather than September 1, 2001. The bill requires the authority to have the power to contract to convey the real and personal property related to the supply and distribution of electrical power within the authority's boundaries to any neighboring municipality or other utility providers that require such conveyance as a condition to electrical upgrades. Because of the condition of the electrical system infrastructure, the bill requires any delegation of the exercise of power and the provision of electric services to only be given to those neighboring municipalities or other utility providers that agree to undertake the steps necessary to upgrade the existing electrical system infrastructure so that the authority will be able to carry out its purpose in conducting eligible projects and be able to exercise its power to expand economic development and commercial activity. The bill requires the authority to determine the criteria to be used to determine the level of upgrading required to be conducted in order to allow the authority to adequately exercise its power for expansion of economic development and commercial activity. The bill requires such delegation to be accomplished without the need for other state regulatory approval. The bill provides that it has been determined that the electrical system infrastructure in place at what was formally known as Reese Air Force Base is not able to supply electricity of sufficient quality and reliability within the boundaries of the authority. This inadequacy has inhibited the authority from exercising its power for expansion of economic development and commercial activity. The bill removes the provision requiring the authority to use a competitive sealed proposal procedure when delegating the provision of electric services and removes the provision requiring the Public Utility Commission of Texas to conduct a study before September 1, 2001. EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.