HBA-JLV S.B. 827 77(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 827 By: Duncan Land & Resource Management 3/23/2001 Engrossed BACKGROUND AND PURPOSE Currently, rural municipalities and counties are not expressly authorized to sell anticipation notes to the Texas Agricultural Finance Authority (authority). These entities must issue municipal bonds for even small loan amounts, and the bond issuance process creates expenses for the political subdivision and requires review by the Texas attorney general. The sale of anticipation notes may facilitate economic development in these municipalities and counties by providing the political subdivisions with a simple and cost-effective means to borrow small amounts of money. Senate Bill 827 authorizes these municipalities and counties to sell anticipation notes to the authority. 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 Senate Bill 827 amends the Government Code to authorize a county or municipality (issuer) participating in a rural economic development plan established by the Texas Agricultural Finance Authority to sell to the authority an anticipation note issued for a specified purpose, provided that the note matures before the 30th anniversary of the date the note is issued. Anticipation notes issued by a single issuer under this Act in an aggregate original principal amount of not more than $500,000 are not subject to the approval of the attorney general or examination and registration of public securities. The bill authorizes an issuer to issue anticipation notes for rural economic development for the same purpose not more than once in any 12month period. EFFECTIVE DATE On passage, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.