S.B. 1295 78(R)    BILL ANALYSIS


S.B. 1295
By: Van de Putte
Defense Affairs and State-Federal Relations
Committee Report (Unamended)


BACKGROUND AND PURPOSE 

The military represents a significant part of the Texas economy,
accounting for more than $49 billion in economic impact. The Office of
Defense Affairs (ODA) is responsible for assisting defense communities to
develop infrastructure to minimize the possibility of, or the negative
effects of, a base closure.  S.B. 1295 requires ODA, in coordination with
the Texas Strategic Military Planning Commission, to assist defense
communities in obtaining financing for economic development projects that
will improve the function of a defense base that is in, adjacent to, or
near the defense community. This bill also establishes the framework in
which defense communities receive assistance from a state agency. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly delegate
any additional rulemaking authority to any state officer, department,
agency, or institution. 

ANALYSIS

SECTION 1. Requires the Office of Defense Affairs (ODA), in coordination
with the Texas Strategic Military Planning Commission (commission), to
assist defense communities in obtaining financing for economic development
projects that will improve the function of a defense base that is in,
adjacent to, or near the defense community. Requires the ODA and the
commission to refer the defense community to certain entities. 

The bill requires a state agency making a loan to a defense community
under this section to evaluate the project and determine whether the
project may be financed through the agency's program. Provides that the
state agency has sole discretion on whether to finance the project. 

The bill requires state agencies, in reviewing applications for financing
from defense communities, to consider the ODA's priority for the project.
Requires ODA to maintain a record of each loan granted to a defense
community that includes the amount of the loan, the agency making the
loan, and a description of the project. Requires ODA to submit to the
state agencies a priority list of economic development projects under this
subsection that totals up to $150 million. Provides that this subsection
expires December 31, 2006. 

The bill requires ODA to enter into a memorandum of understanding with
each state agency that has a program to fund economic development projects
for defense communities. Requires the memorandum of understanding to
include each agencies responsibilities in granting and administering a
loan to a defense community. 

The bill authorizes a state agency making a loan to the defense community
for a project described in Section 481.502(a), in addition to any other
security provided by law if a defense community defaults on a loan, to
foreclose under a loan agreement in the manner provided by law for
foreclosure and liquidate any collateral provided under the loan agreement
to recover any outstanding debt. 

The bill authorizes ODA to accept gifts and grants from any source for the
purposes of this subchapter. 

SECTION 2. This Act takes effect September 1, 2003, unless it receives the
votes necessary for immediate effect.