Office of House Bill AnalysisS.B. 269
By: Duncan
Economic Development


Currently, economic development corporations formed under Section 4A,
Article 5190.6, V.T.C.S. (Development Corporation Act of 1979), are subject
to dissolution by popular election.  However, development corporations
formed under Section 4B (which establishes the Texas Small Business
Industrial Development Corporation) are not subject to popular dissolution.
S.B. 269 provides a procedure for the popular dissolution of certain
economic development corporations. 


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 1.  Amends Section 4B, Article 5190.6, V.T.C.S. (Development
Corporation Act of 1979), by amending Subsection (e), as amended by Chapter
1022, Acts of the 73rd Legislature, Regular Session, 1993, and adding
Subsections (e-1) and (o), as follows: 

(e)  Includes within the existing provisions of this subsection, that a
corporation holding an election to abolish, in addition to an election to
reduce, a tax imposed under Section 4A (Corporation in City Located in
County with Population of 500,000 or Fewer or City with Population of Fewer
than 50,000) of this Act may adopt a tax under this section either in the
same or in a separate proposition, rather than only in a separate
proposition, on the same ballot. Makes a nonsubstantive change. 

(e-1)  Provides that if a city dissolves a corporation created under
Section 4A of this Act and creates a corporation under this section, a
person serving as a director of the corporation created under Section 4A of
this Act at the time of dissolution is authorized to serve on the board of
directors of the corporation created under this section, nothwithstanding
any other provision of this section.  

(o)  Requires the governing body of a city creating a corporation under
this section to order an election on the dissolution as described by this
section.  Provides the election to be held on a certain date. Requires that
the ballot be printed to permit voting for or against the proposition and
sets forth language for the ballot. Requires the corporation to continue
necessary operations to meet previous obligations of the corporation in the
manner described by this section if the majority of the votes cast are in
favor of the dissolution. Requires the corporation to liquidate corporate
assets and apply the proceeds to satisfy the corporation's obligations.
Prohibits the collection of a tax imposed under this section after the last
day of the first calendar quarter that begins after the city provides
notice of the dissolution. Provides that the provisions of this section
have no effect if less than a majority of the votes cast at the election
favor the dissolution. 

SECTION 2.  Makes application of Subsection (o), as added by this Act,

SECTION 3.  Effective date: September 1, 1999.

SECTION 4.  Emergency clause.