Bill Text: TX SB1395 | 2011-2012 | 82nd Legislature | Introduced

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Bill Title: Relating to the administration, financing, and use of the State Infrastructure Bank.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2011-03-22 - Referred to Transportation & Homeland Sec. [SB1395 Detail]

Download: Texas-2011-SB1395-Introduced.html

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82R13696 T
By: Williams S.B. No. 1395

A BILL TO BE ENTITLED
AN ACT
relating to the administration, financing, and use of the State
Infrastructure Bank.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 222.071, Transportation Code, is amended
to read as follows:
Sec. 222.071. DEFINITIONS. In this subchapter:
(1) "Bank" means the state infrastructure bank
account.
(2) "Bonds" means bonds, notes, and other public
securities.
(3) [(2)] "Construction" has the meaning assigned by
23 U.S.C. Section 101.
(4) "Credit agreement" has the meaning assigned by
Section 1371.001, Government Code.
(5) [(3)] "Federal act" means Section 350 of the
National Highway System Designation Act of 1995 (Pub. L. No.
104-59).
(6) [(4)] "Federal-aid highway" has the meaning
assigned by 23 U.S.C. Section 101.
(7) [(5)] "Qualified project" includes:
(A) the construction of a federal-aid highway;
(B) a transit project under 49 U.S.C. Sections
5307, 5309, and 5311; [or]
(C) a transportation project; or
(D) [(C)] for the expenditure of secondary funds
from a subaccount subject to the federal act, a project eligible for
assistance under Title 23 or Title 49, United States Code.
(8) [(6)] "Secondary funds" includes:
(A) the repayment of a loan or other assistance
that is provided with money deposited to the credit of the bank; and
(B) investment income generated by secondary
funds deposited to the credit of the bank.
(9) "Transportation project" means a tolled or
nontolled highway improvement project.
SECTION 2. Section 222.072, Transportation Code, is amended
to read as follows:
Sec. 222.072. STATE INFRASTRUCTURE BANK. (a) The state
infrastructure bank is an account held in the Texas Treasury
Safekeeping Trust Company [state highway fund]. The bank is
administered by the commission.
(b) The commission may deposit in the bank money derived
from any source available to the commission, including:
(1) federal [Federal] funds received by the state,
including funds received under the federal act; [,]
(2) matching state funds in an amount required by the
federal [that] act; [,]
(3) if appropriated by the legislature for that
purpose:
(A) the proceeds of bonds issued under Section
222.003;
(B) the proceeds of bonds issued under Section
222.004; and
(C) other direct appropriations;
(4) the proceeds of bonds issued under Section 201.943
and money provided by the commission from the Texas Mobility Fund
that is in excess of the money required to be on deposit in the Texas
Mobility Fund by the proceedings authorizing Texas Mobility Fund
bonds and credit agreements;
(5) repayments of principal and interest on loans made
under Section 222.074;
(6) the proceeds from the sale of loans under Section
222.078;
(7) proceeds from bonds issued under Section 222.075;
[,]
(8) secondary funds; and [,]
(9) gifts and grants [other state funds deposited into
the bank by order of the commission, and other money received by the
state that is eligible for deposit in the bank may be deposited into
the bank and used only for the purposes described in this
subchapter].
(c) The commission shall prepare and file biennially with
the governor, the lieutenant governor, and the Legislative Budget
Board a report providing information on the operation of the bank,
including:
(1) the amounts and sources of money deposited in the
bank during the biennium;
(2) investments and returns on investments of money in
the bank during the biennium;
(3) loans made from the bank during the biennium;
(4) other financial assistance provided from the bank
during the biennium;
(5) the status of any defaults on repayment of loans or
other financial assistance provided from the bank; and
(6) the details of any qualified project for which
financial assistance is received from the bank during the biennium,
including the identity of any highway directly affected by the
project, and the degree to which the project is designed to reduce
congestion, improve traffic safety, and enhance connectivity.
SECTION 3. Section 222.074, Transportation Code, is amended
by amending Subsection (a) and by adding Subsections (d), (e), (f),
and (g) to read as follows:
(a) To further a purpose described by Section 222.073, the
commission may use money deposited to the credit of the bank to
provide financial assistance to a public or private entity,
including the department, for a qualified project to:
(1) extend credit by direct loan, including through
the purchase of obligations of a public entity;
(2) provide liquidity or credit enhancement,
[enhancements] including through the agreement to loan to a public
or private entity or to purchase bonds, notes, or other obligations
from a public entity;
(3) serve as a capital reserve for bond or debt
instrument financing;
(4) subsidize interest rates;
(5) insure the issuance of a letter of credit or credit
instrument;
(6) finance a purchase or lease agreement in
connection with a transit project;
(7) provide capitalized interest for debt financing by
the public or private entity;
(8) providing a guarantee of the payment of the costs
of the operation and maintenance of a qualified project by a public
entity;
(9) [(7)] provide security for bonds and other debt
instruments; [or]
(10) pay the costs of issuing bonds or other debt
instruments; or
(11) [(8)] provide methods of leveraging money that
have been approved by the United States secretary of transportation
and relate to the project for which the assistance is provided.
(d) The proceeds of bonds issued under Section 222.003 or
Section 222.004 may only be used to provide financial assistance
for highway improvement projects, subject to any limitations
provided by law.
(e) Money from the Texas Mobility Fund may only be used to
provide financial assistance for state highway improvement
projects, publicly owned toll roads, and public transportation
projects, whether on or off of the state highway system, subject to
any limitations provided by law.
(f) The commission may require a public or private entity to
pay an application fee and other reasonable amounts in connection
with any request for financial assistance provided from the bank.
Revenue generated from payments of fees and other amounts shall be
deposited in the state highway fund.
(g) The department shall monitor the use of financial
assistance provided to a public or private entity to ensure the
financial assistance is used for purposes authorized by law and may
audit the books and records of a public or private entity for this
purpose.
SECTION 4. Section 222.0745, Transportation Code, is
amended to read as follows:
Sec. 222.0745. INCURRENCE OF DEBT BY PUBLIC ENTITY. (a) A
public entity in this state, including a municipality, county,
district, authority, agency, department, board, or commission,
that is authorized by law to construct, maintain, or finance a
qualified project may borrow money from the bank, including by
direct loan or other financial assistance from the bank, and may
enter into any agreement relating to receiving financial assistance
from the bank [based on the credit of the public entity].
(b) Money received by a public entity under this subchapter
[borrowed under this section] must be segregated from other funds
under the control of the public entity and may only be used for
purposes authorized by this subchapter [related to a qualified
project].
(c) To provide for the repayment of a loan or other
financial assistance, a public entity may:
(1) pledge revenues or income from any available
source;
(2) pledge, levy, and collect any taxes, subject to
any constitutional limitation; or
(3) pledge any combination of revenues, income, and
taxes.
(d) This section is wholly sufficient authority for a public
entity to borrow or otherwise obtain financial assistance from the
bank as authorized by this subchapter and to pledge revenues,
income, or taxes, or any combination of revenues, income, and
taxes, to the repayment of a loan or other financial assistance.
(e) [(c)] The authority granted by this section does not
affect the ability of a public entity to incur debt using other
statutorily authorized methods.
SECTION 5. Section 222.075, Transportation Code, is amended
by amending Subsections (b), (f), (i), and (j) to read as follows:
(b) Except as provided by Subsection (c), the commission may
issue revenue bonds or revenue refunding bonds under this section
without complying with any other law applicable to the issuance of
bonds, and may enter into credit agreements related to the bonds.
(f) The commission may require participants to make
charges, levy taxes, or otherwise provide for sufficient money to
repay financial assistance provided from the bank, including any
[pay] acquired obligations.
(i) Before the issuance of revenue bonds or credit
agreements, the commission shall submit the record of [All]
proceedings of the commission authorizing [relating to] the
issuance, execution, and delivery of the [revenue] bonds or credit
agreement and any contract providing revenue or security to pay the
bonds or credit agreement [issued under this section shall be
submitted] to the attorney general for review [examination]. If
the attorney general finds that the proceedings authorizing a bond
or credit agreement and any bonds authorized in the proceedings
conform to the requirements of the Texas Constitution and this
subchapter [On determining that the revenue bonds have been
authorized in accordance with law], the attorney general shall
approve the proceedings and the [revenue] bonds, and shall deliver
to [the revenue bonds shall be registered by] the comptroller for
registration a copy of the attorney general's legal opinion stating
that approval and the record of proceedings. After approval, the
bonds or credit agreement may be executed and delivered, exchanged,
or refinanced from time to time in accordance with those
authorizing proceedings. After the approval and registration, the
[revenue] bonds or credit agreement, as applicable, or a contract
providing revenue or security included in or executed and delivered
according to the authorizing proceedings are incontestable in any
court or other forum for any reason and are valid, [and] binding,
and enforceable [obligations] in accordance with their terms for
all purposes.
(j) The proceeds from the sale of revenue bonds may be used
to finance other funds or accounts relating to the bonds or credit
agreement, including a debt service reserve fund, and to pay the
costs of issuance. All remaining [The] proceeds received from the
sale of the [revenue] bonds shall be deposited in the bank and
invested and used in the manner provided for other funds deposited
under this subchapter.
SECTION 6. Section 222.076, Transportation Code, is amended
by adding Subsection (c) to read as follows:
(c) The commission may create within a subaccount one or
more additional subaccounts as determined appropriate and
necessary by the commission.
SECTION 7. Section 222.077, Transportation Code, is amended
to read as follows:
Sec. 222.077. REPAYMENT TERMS; DEPOSIT OF REPAYMENTS;
INVESTMENT INCOME. (a) For financial assistance that [Any funds
disbursed through the state infrastructure bank] must be repaid,
[on terms determined by] the commission shall determine the terms
and conditions of the repayment, including the interest rates to be
charged. The terms must comply with the federal act except for terms
applicable to funds deposited in a subaccount described by Section
222.076(b).
(b) For a tolled highway improvement project, the
commission may require that revenues from the project be shared
between the entity and the department, and the entity and the
department may enter into an agreement specifying the terms and
conditions of the revenue sharing.
(c) [(b)] Notwithstanding any other law to the contrary:
(1) the repayment of a loan or other assistance
provided with money deposited to the credit of a subaccount in the
bank, including all amounts received as a share of revenues from a
tolled highway improvement project, shall be deposited in that
subaccount; and
(2) investment income generated by money deposited to
the credit of a subaccount in the bank shall be:
(A) credited to that subaccount, subject to
requirements that may be imposed by the proceedings authorizing
bonds issued to provide money for deposit in the bank that are
necessary to protect the tax-exempt status of interest payable on
the bonds in accordance with applicable law of the United States
concerning federal income taxation of interest on the bonds;
(B) available for use in providing financial
assistance under this subchapter; and
(C) invested in United States Treasury
securities, bank deposits, or other financing instruments approved
by the United States secretary of transportation to earn interest
and enhance the financing of projects assisted by the bank, except
that the proceeds of bonds deposited in the bank under Section
222.072 shall be subject to any limitations contained in the
documents authorizing the issuance of the bonds.
(d) [(c)] The commission shall administer the bank in
compliance with applicable requirements of the federal act and any
applicable federal regulation or guideline.
(e) [(d)] The commission by rule shall:
(1) implement this subchapter; and
(2) establish eligibility criteria for an entity
applying for financial assistance from the bank.
SECTION 8. Subchapter D, Chapter 222, Transportation Code,
is amended by adding Sections 222.078 and 222.079 to read as
follows:
Sec. 222.078. SALE OF LOANS. (a) As used in this section,
"loan" includes any financial assistance that must be repaid or any
portion of such assistance.
(b) The commission may sell any loans made from money in the
bank and shall deposit the proceeds of the sale in the bank.
(c) For any loans to be sold under this section, the
commission may submit to the attorney general for review and
approval the related financial assistance agreement, which shall,
for the purposes of Chapter 1202, Government Code, be considered to
be a public security, along with the record of proceedings of the
borrowing entity relating to the agreement. If the attorney
general approves the agreement, it shall be incontestable in a
court or other forum and is valid, binding, and enforceable
according to its terms as provided by Chapter 1202, Government
Code.
(d) The commission must sell the loans using a competitive
bidding process and at the price and under the terms and conditions
that it determines to be reasonable.
(e) As part of the sales agreement with the purchaser of a
loan, the commission may agree to perform the functions required to
enforce the conditions and requirements stated in the loans,
including enforcing the payment of debt service by the borrowing
entity.
(f) The commission may exercise any powers necessary to
carry out the authority granted by this section, including the
authority to contract with any person to accomplish the purposes of
this section.
(g) Neither the state nor the commission shall be liable for
the repayment of, and may not repay, any loan sold under this
section.
Sec. 222.079. WAIVER OF SOVEREIGN IMMUNITY. A public
entity receiving financial assistance under this subchapter waives
sovereign immunity to suit for the purpose of adjudicating a claim
for breach of the terms of the financial assistance agreement.
SECTION 9. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2011.