HBA-MPM S.B. 356 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 356 By: Brown Public Health 3/23/1999 Engrossed BACKGROUND AND PURPOSE The Texas Hospital Equipment Financing Council (HEFC) was created to provide low-cost loans to hospitals, especially in rural areas, for the purchase of equipment, by issuing, selling and delivering bonds. The small hospitals could then borrow from the HEFC and receive the benefit of the lower financing cost, while the expense of the bond issuance would be shared by a pool of small hospitals. Because the small rural hospitals' lacked the credit qualifications the bond insurers required of loan applicants, the HEFC was unable to perform this role. Subsequently, the legislature eliminated HEFC's ability to issue bonds and limited its purpose to providing for the validity and enforceability of its bonds outstanding on September 1, 1989. On October 7, 1998, HEFC redeemed all of its bonds that were outstanding, and therefore it no longer serves a needed purpose. HEFC is subject to review under the Texas Sunset Act and will be abolished September 1, 1999, unless continued by the legislature. The Sunset Advisory Commission, having reviewed HEFC, recommended its abolishment. S.B. 356 abolishes the Texas Hospital Equipment Financing Council. 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. Repealer: Chapter 224 (Hospital Equipment Financing), Health and Safety Code. Repealer: Section 151.3131 (Texas Hospital Equipment Financing Council), Tax Code. SECTION 2. Effective date: September 1, 1999. SECTION 3. Emergency clause.