HBA-SEP C.S.H.B. 3178 77(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 3178 By: Solis, Jim Economic Development 4/20/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE Since 1989, voters in many Texas cities have had the option of imposing a local sales and use tax to help finance community economic development efforts. Over 400 cities have levied this tax, helping to raise revenues in an excess of $240 million in 1999. Requiring persons associated with development corporations to complete a training seminar on the operation and administration of development corporations may result in more effective use of this revenue. C.S.H.B. 3178 requires certain persons associated with development corporations to complete a seminar developed by the Texas Department of Economic Development. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Department of Economic Development in SECTION 1 (Section 481.0231, Government Code) of this bill. ANALYSIS C.S.H.B. 3178 amends the Government Code to require the Texas Department of Economic Development (department), in conjunction with the attorney general and the comptroller of public accounts (comptroller), to develop by rule a training seminar to ensure that the officers of a development corporation created by a municipality or county and the officials of the municipality or county that created a development corporation under the Development Corporation Act of 1979 (Act) properly and legally operate the development corporation and administer a tax imposed for the benefit of the development corporation. The department is authorized to include in the seminar any information regarding training programs offered by the department, the attorney general, or the comptroller that would assist a person attending the seminar with the operation and administration of a development corporation. The bill requires the department to issue a certificate of completion to each person who completes the seminar. The bill also requires the department to hold the seminars in different regions of the state for the convenience of persons required to complete the seminar. The department is authorized to enter into an agreement for the provision of a seminar by any person determined by the department to be qualified. The person is authorized to charge a reasonable fee for attending the seminar. The bill amends the Act to require the city attorney, the city administrator, or the city clerk of a city that created a 4A or 4B development corporation, the county clerk or the county attorney of a county that created a 4A or 4B development corporation, and the executive director of a 4A or 4B development corporation or other person who is responsible for the daily administration of a 4A or 4B development corporation to attend a seminar at least once in each 24-month period. A development corporation is required to present proof of compliance to the comptroller by presenting the certificates of completion for each person that was required to attend the training seminar. The comptroller is authorized to impose an administrative penalty, not to exceed $1,000 for each violation, against a development corporation that fails to present proof of compliance. A development corporation is authorized to spend corporate revenue to pay the costs of attending a seminar. The bill provides that a person who is required to take a training seminar on the effective date of the bill must do so before January 1, 2004. EFFECTIVE DATE September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 3178 modifies the original to specify that the Texas Department of Economic Development (department) is authorized to enter into an agreement for the provision of a training seminar. The substitute authorizes a person who provides a training seminar to charge a reasonable fee for attending the seminar. The substitute adds the city clerk of a city that created a development corporation to the list of persons who are required to attend a seminar at least once in each 24-month period. The substitute specifies that the training requirements only apply to 4A and 4B development corporations and any entity that creates a 4A or 4B development corporation.