HBA-LJP S.B. 1672 77(R)    BILL ANALYSIS


Office of House Bill AnalysisS.B. 1672
By: Jackson
Land & Resource Management
4/12/2001
Engrossed



BACKGROUND AND PURPOSE 

The Texas Legislature created the asset management division of the General
Land Office (division) in 1985 to promulgate a development plan on real
property before it is offered for sale or lease.  Since the creation of the
division, the responsibilities of the division have been modified to
reflect new state real property management practices.  Senate Bill 1672
reorganizes and consolidates the responsibilities of the division. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking is
expressly delegated to the asset management division of the General Land
Office in SECTION 7 (Section 31.1572, Natural Resources Code) of this bill. 

ANALYSIS

Senate Bill 1672 amends the Natural Resources Code to provide that if a
state agency intends to dispose of or change the use of real property
possessed by the agency and the property is determined to be unused or
underused, an agency must notify the asset management division (division)
of the General Land Office no later than the 30th day before the date of
the proposed disposition or change, including before any proposed
improvement, development, lease, or sale of the property.  The bill also
requires each state agency no later than January 30 of each year to provide
a report with stipulated contents to the division about any unused or
underused real property possessed by the agency, as determined by the
division (Sec. 31.153). 

The bill provides for the exclusion of real property administered by the
Texas Historical Commission or the State Preservation Board or real
property comprising the Alamo or the French Legation from the review and
verification duties of the division (Sec. 31.155). 

The bill requires, rather than authorizes, the division to verify the
accuracy of the real property inventory of each state agency and provides
that the required review be made not later than one year before the date
the agency is scheduled for abolition under the Texas Sunset Act.  The bill
repeals provisions relating to the division furnishing the appraisal of
properties identified as unused or underused to the Texas Department of
Housing and Community Affairs (TDHCA).  The bill also removes the
requirement of the division to solicit proposals about real estate
transactions involving property that would be of significant benefit to the
state (Sec. 31.156 and SECTION 9). 

The bill requires that the draft report of the commissioner of the General
Land Office (commissioner) be submitted for review to applicable agencies
and to the TDHCA which is required to evaluate the suitability of the
property for affordable housing.  The bill provides that each agency is
authorized to comment on any findings or recommendations made by the
commissioner and is required to complete the review of the draft report not
later than the 60th day after the date of receipt of the report.  The bill
also repeals the authorization of TDHCA to comment on any findings or
recommendations made by the commissioner and provide additional comments
(Sec. 31.157). 

 The bill authorizes the commissioner to make a written recommendation to
the governor for the disposition of the property through a real estate
transaction if the commissioner reports that an item of real property is
unused or underused.  The bill authorizes the state agency that possesses
the property in a real estate transaction to submit to the governor and the
division a comment regarding or an objection to the recommendation not
later than the 60th day after the date the governor receives the
recommendation.  The bill authorizes the commissioner to conduct the
recommended real estate transaction unless the governor gives the
commissioner written notice of disapproval not later than the 90th day
after the date the governor receives the recommendation. 

The bill requires the division to provide TDHCA with an appraisal of the
property for evaluating the suitability of the property for affordable
housing no later than the 30th day after the governor approves or is
considered to have approved a recommended real estate transaction for real
property. The bill repeals provisions relating to the general development
plan for future use of real property that is reported as unused or
underused (Sec. 31.1571). 

In conducting certain real estate transactions, the division is required to
take charge and control of the real property and act on behalf of the state
agency that had charge and control of the real property.  The bill
authorizes deductions from the proceeds of certain real estate
transactions, before the proceeds are deposited, of any expenses incurred
by the division in conducting the real property transactions.  The bill
authorizes the division to adopt rules relating to the payment of
reasonable brokerage fees in conducting certain real property transactions.
The bill requires the proceeds to be deposited to stipulated accounts,
unless the proceeds are previously dedicated by the Texas Constitution, and
sets forth provisions relating to the appropriation of the deposited
proceeds (Sec. 31.1572). 

The bill authorizes the commissioner to offer to a lessee of the state the
first option for a real estate transaction involving real property if the
lessee leases real property adjacent to the applicable property and the
commissioner determines that the transaction is in the best interest of the
state.  If the commissioner determines the transaction is in the best
interest of the state, then the bill authorizes the division to negotiate
and complete an exchange transaction in the manner provided for the trade
of land dedicated to the permanent school fund (Sec. 31.158). 

The bill repeals provisions relating to real estate transactions not
authorized by the legislature and to forms for grants for land, timber, and
surface resources (SECTION 9). 

EFFECTIVE DATE

September 1, 2001.