HBA-SEB H.B. 2465 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 2465
By: Cook
Energy Resources
3/19/1999
Introduced



BACKGROUND AND PURPOSE 

A limited liability company (LLC) is a relatively new business structure
that was authorized by the Texas Legislature in 1991. An LLC is a
combination of a partnership and a corporation that maintains the limited
liability of a corporation while receiving  federal tax treatment as a
partnership. Some common carrier pipelines in Texas have reorganized as
LLCs.  Since the law that created LLCs did not amend other laws that
regulate business entities, the issue of whether the LLCs have the rights
afforded to other business entities remains unclear.  H.B. 2465 provides
that an LLC that is a common carrier in the pipeline business has the same
right of eminent domain and other rights that the LLC previously had as a
corporation or partnership.    

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. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Article 2.02, Article 1528n, V.T.C.S. (Texas Limited
Liability Company Act), by adding Section D, as follows: 

D.  Provides that a limited liability company engaged as a common carrier
in the pipeline business for transporting oil, oil products, gas, carbon
dioxide, salt brine, fuller's earth, sand, clay, liquefied minerals, or
other mineral solutions has all of the rights and powers conferred by
Sections 111.019 (Right of Eminent Domain), 111.020 (Pipeline on Public
Stream or Highway), 111.021 (Pipeline Under Railroad, Street Railroad, or
Canal), 111.022 (Right to Use Street or Alley in City or Town), Natural
Resources Code. 

SECTION 2.  Effective date: September 1, 1999.

SECTION 3.  Emergency clause.