HBA-TBM C.S.H.B. 2744 77(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 2744
By: Carter
County Affairs
4/1/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

During the most recent interim, the House Committee on Urban Affairs
(committee) researched whether emergency services districts (ESD) and rural
fire prevention districts (RFPD) are able to provide the highest quality
services under current statutory requirements.  Testimony indicated that
ESDs and RFPDs need greater flexibility in structuring districts to provide
fire protection and emergency services.  After studying the procedural,
geographical, and economic problems faced by ESDs and RFPDs, the committee
recommended authorizing ESDs and RFPDs to exchange territory and expanding
their power to borrow money.  C.S.H.B. 2744 enacts these recommendations.   

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. 

ANALYSIS

C.S.H.B. 2744 amends the Health and Safety Code to provide that the tax
rate of an emergency services district (ESD) or a rural fire prevention
district (RFPD) is any rate allowed by the Texas Constitution (Secs.
775.018, 775.024, 776.019, and 794.018).  The bill authorizes the board of
commissioners (board) of an ESD or RFPD to order an election to increase
the maximum tax rate of the ESD or RFPD to any rate at or below the rate
allowed by the Texas Constitution and sets forth provisions regarding
ballots, notice of the election, election date, and majority favor (Secs.
775.0745, 776.0755, and 794.0181).    

The bill authorizes a district to make a mutually agreeable change in
boundaries with another district if the maximum tax rate for the annexed
territory is not lower than that of the annexing district.  The bill sets
forth provisions regarding the effective date of change, provisions of
services, the rights of the holders of any outstanding district
obligations, and compensation by the annexing district (Secs. 775.056,
776.058, and 794.061).   

The bill provides that the limitation on the amount of debt an ESD or RFPD
is allowed to undertake in a year does not apply to the issuance of bond
anticipation notes or the borrowing of money to purchase real property or
emergency services equipment (Secs. 775.071, 776.071, and 794.071).   

The bill modifies the authority of the board of an ESD or RFPD and
authorizes the board of an ESD in a county with a population of 125,000 or
less to make financial arrangements to purchase real property or emergency
services equipment.  The bill provides that the board may pledge unattached
tax revenues or funds on hand or the property acquired with the borrowed
money to secure a loan.  If tax revenues are pledged to pay a loan, the
loan must mature not later than the 10th or 20th anniversary of the date
the loan is made for equipment or real property respectively (Secs.
775.085, 776.082, and 794.083).   

The bill provides that competitive bidding requirements are authorized but
not required of the board of an RFPD when contracting for fire
extinguishment and suppression service, emergency rescue service, or
ambulance service (Sec. 794.074).   
 
The bill repeals provisions relating to an election to increase the tax
rate of an ESD and certain provisions relating to bonds and notes issued by
an ESD or RFPD (SECTION 23).   

EFFECTIVE DATE

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 2744 differs from the original by adding provisions relating to
maximum tax rates (Secs. 775.018, 775.024, 775.0745, 776.019, 776.0755,
794.018, and 794.0181).  The substitute provides that a district is
authorized to make a mutually agreeable change in boundaries with another
district if the maximum tax rate for the annexed territory is not lower
than that of the annexing district and requires the districts to determine
an effective date of change.  The bill removes provisions regarding the
disannexation of territory and the purchase by the annexing district of
property used by the other district to supply services (Secs. 775.056,
776.058, and 794.061).  The substitute authorizes rather than requires
competitive bidding practices for an RFPD contracting for emergency
services (Sec. 794.074).  The substitute repeals and replaces the provision
authorizing the board of an ESD to call an election to raise the district
tax rate (Sec. 775.0745 and SECTION 23).  The substitute changes the
effective date from September 1, 2001, to on passage if the Act receives
the necessary vote (SECTION 26).