85R3494 CLG-F
	By: Johnson of Dallas	H.B. No. 671

	A BILL TO BE ENTITLED
	AN ACT
	relating to the operation of the capital access program and to
	transfers to and from the capital access fund.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 481.078, Government Code, is amended by
	amending Subsection (c) and adding Subsections (d-2) and (d-3) to
	read as follows:
	(c)  Except as provided by Subsections (d), [and] (d-1),
	(d-2), and (d-3), the fund may be used only for economic
	development, infrastructure development, community development,
	job training programs, and business incentives.
	(d-2)  On the second day of each state fiscal biennium, the
	comptroller shall determine:
	(1)  an amount equal to 10 percent of the unencumbered
	balance of the fund; and
	(2)  after consultation with the bank, an amount equal
	to the sum of the unencumbered balance of the capital access fund
	and the aggregate amount of contributions made by the bank to
	reserve accounts established under Subchapter BB during the
	preceding state fiscal biennium.
	(d-3)  If the amount determined under Subsection (d-2)(1) is
	greater than the amount determined under Subsection (d-2)(2), the
	comptroller, not later than the 30th day of the state fiscal
	biennium for which the determination is made, shall transfer from
	the fund to the credit of the capital access fund an amount equal to
	the difference between those amounts.
	SECTION 2.  Section 481.404, Government Code, is amended to
	read as follows:
	Sec. 481.404.  POWERS OF BANK IN ADMINISTERING CAPITAL
	ACCESS FUND. (a) In administering the fund, the bank has the powers
	necessary to carry out the purposes of this subchapter, including
	the power to:
	(1)  make, execute, and deliver contracts,
	conveyances, and other instruments necessary to the exercise of its
	powers;
	(2)  invest money at the bank's discretion in
	obligations determined proper by the bank, and select and use
	depositories for its money;
	(3)  employ personnel and counsel and pay the persons
	from money in the fund legally available for that purpose; and
	(4)  impose and collect fees and charges in connection
	with any transaction and provide for reasonable penalties for
	delinquent payment of fees or charges.
	(b)  The bank may not transfer money out of the fund except to
	carry out the purposes of this subchapter.
	SECTION 3.  Section 481.405, Government Code, is amended by
	adding Subsection (c-1) to read as follows:
	(c-1)  For the purpose of determining the eligibility of a
	financial institution to participate in the program, the bank shall
	use a methodology that gives priority to financial institutions
	located in areas designated as enterprise zones under Chapter 2303.
	SECTION 4.  Section 489.211(b), Government Code, is amended
	to read as follows:
	(b)  The product fund is composed of proceeds of bonds issued
	under this subchapter, financing application fees, loan
	repayments, guarantee fees, royalty receipts, dividend income,
	money appropriated by the legislature for authorized purposes of
	the product fund, amounts received by the state from loans, loan
	guarantees, and equity investments made under this subchapter,
	amounts received by the state from federal grants or other sources,
	[amounts transferred from the capital access fund under Section
	481.415,] and any other amounts received under this subchapter and
	required by the bank to be deposited in the product fund.  The
	product fund contains a program account, an interest and sinking
	account, and other accounts that the bank authorizes to be created
	and maintained.  Money in the product fund is available for use by
	the board under this subchapter.  Investment earnings under the
	product fund must be transferred to the fund created under Section
	489.105.  Notwithstanding any other provision of this subchapter,
	any money in the product fund may be used for debt service.
	SECTION 5.  Section 489.212(b), Government Code, is amended
	to read as follows:
	(b)  The small business fund is composed of proceeds of bonds
	issued under this subchapter, financing application fees, loan
	repayments, guarantee fees, royalty receipts, dividend income,
	money appropriated by the legislature for authorized purposes of
	the small business fund, amounts received by the state from loans,
	loan guarantees, and equity investments made under this subchapter,
	amounts received by the state from federal grants or other sources,
	[amounts transferred from the capital access fund under Section
	481.415,] and any other amounts received under this subchapter and
	required by the bank to be deposited in the small business
	fund.  The small business fund contains a project account, an
	interest and sinking account, and other accounts that the bank
	authorizes to be created and maintained.  Money in the small
	business fund is available for use by the board under this
	subchapter.  Investment earnings under the small business fund
	must be transferred to the fund created under Section
	489.105.  Notwithstanding any other provision of this subchapter,
	any money in the small business fund may be used for debt service.
	SECTION 6.  Section 481.415, Government Code, is repealed.
	SECTION 7.  Notwithstanding Sections 481.078(d-2) and
	(d-3), Government Code, as added by this Act, not later than the
	30th day of the state fiscal biennium beginning September 1, 2017,
	the comptroller shall transfer 10 percent of the unencumbered
	balance of the Texas Enterprise Fund as of September 2, 2017, to the
	credit of the capital access fund in lieu of taking any other action
	under those subsections for the state fiscal biennium beginning
	September 1, 2017.
	SECTION 8.  This Act takes effect September 1, 2017.