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A BILL TO BE ENTITLED
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AN ACT
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relating to the creation, administration, powers, duties, |
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operations, and financing of a border region high-speed rail |
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authority for the Texas-Louisiana and the Texas-Mexico border |
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regions; granting the power to issue bonds; imposing a tax; |
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granting the power of eminent domain. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 13, Title 112, Revised Statutes, is |
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amended by adding Article 6550c-4 to read as follows: |
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Art. 6550c-4. BORDER REGION HIGH-SPEED RAIL AUTHORITIES |
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Sec. 1. DEFINITIONS. In this article: |
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(1) "Authority" means a border region high-speed rail |
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authority created under this article. |
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(2) "Authority property" means all property an |
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authority owns or leases under a long-term lease. |
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(3) "Border region" means the Texas-Louisiana border |
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region or the Texas-Mexico border region, as defined by Section |
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2056.002, Government Code. |
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(4) "Commission" means the Texas Transportation |
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Commission. |
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(5) "Department" means the Texas Department of |
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Transportation. |
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(6) "High-speed rail" means the rail technology that |
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permits the operation of rolling stock between scheduled stops at |
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speeds greater than 70 miles per hour. |
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(7) "High-speed rail facility" means any property |
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necessary for the transportation of passengers and baggage between |
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points in a border region by high-speed rail. The term includes |
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rolling stock, locomotives, stations, parking areas, and rail |
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lines. |
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(8) "System" means all of the high-speed rail and |
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intermodal facilities leased or owned by or operated on behalf of an |
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authority. |
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Sec. 2. CREATION OF AUTHORITIES. The commission by order |
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may authorize the creation of an authority in each border region for |
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the purposes of financing, acquiring property for, constructing, |
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maintaining, operating, and improving a high-speed rail system in |
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each border region. |
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Sec. 3. GOVERNING BODY. (a) The governing body of an |
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authority is a board of directors consisting of representatives of |
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each county in the border region for which the authority is created. |
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The board is composed of 11 members appointed by the governor. |
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(b) The members of the board shall elect one member as |
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presiding officer. The presiding officer may select another member |
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to preside in the absence of the presiding officer. |
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(c) The presiding officer shall call at least one meeting of |
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the board each year and may call other meetings as the presiding |
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officer determines are appropriate. |
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(d) A member of the board is not entitled to compensation |
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for serving as a member but is entitled to reimbursement for |
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reasonable expenses incurred while serving as a member. |
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(e) The board shall adopt rules for its proceedings and |
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appoint an executive committee. The board may employ and |
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compensate persons to carry out the powers and duties of the |
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authority. |
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(f) Chapter 171, Local Government Code, applies to a member |
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of the board. |
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Sec. 4. POWERS AND DUTIES OF AUTHORITY. (a) An authority |
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is a public body and a political subdivision of the state exercising |
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public and essential governmental functions and has all the powers |
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necessary or convenient to carry out the purposes of this article. |
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An authority, in the exercise of powers under this article, is |
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performing only governmental functions and is a governmental unit |
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within the meaning of Chapter 101, Civil Practice and Remedies |
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Code. |
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(b) An authority is subject every 12th year to review under |
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Chapter 325, Government Code (Texas Sunset Act). |
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(c) An authority may sue and be sued in all courts, may |
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institute and prosecute suits without giving security for costs, |
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and may appeal from a judgment without giving a supersedeas or cost |
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bond. An action at law or in equity against an authority must be |
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brought in the county in which a principal office of the authority |
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is located, except that in an eminent domain proceeding involving |
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an interest in land, suit must be brought in the county in which the |
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land is located. |
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(d) An authority may acquire by grant, purchase, gift, |
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devise, lease, or otherwise and may hold, use, sell, lease, or |
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dispose of real and personal property, licenses, patents, rights, |
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and interests necessary, convenient, or useful for the full |
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exercise of its powers. |
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(e) An authority may acquire, construct, develop, own, |
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operate, maintain, and improve intermodal and high-speed rail |
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facilities to connect political subdivisions in the applicable |
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border region. For this purpose and with the consent of a |
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municipality, county, or other political subdivision, an authority |
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may use streets, alleys, roads, highways, and other public ways of |
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the municipality, county, or other political subdivision and may |
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relocate, raise, reroute, change the grade of, or alter, at the |
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expense of the authority, the construction of any street, alley, |
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highway, road, railroad, electric lines and facilities, telegraph |
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and telephone properties and facilities, pipelines and facilities, |
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conduits and facilities, and other properties, whether publicly or |
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privately owned, as necessary or useful in the construction, |
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reconstruction, repair, maintenance, operation, and improvement of |
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the system. An authority may not use or alter a road or highway that |
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is part of the state highway system without the permission of the |
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commission or a railroad without permission of the railroad. An |
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authority may acquire by purchase any interest in real property for |
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the acquisition, construction, operation, or improvement of a |
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high-speed rail facility on terms and at a price as agreed to |
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between the authority and the owner. The governing body of a |
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municipality, county, other political subdivision, or public |
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agency may convey title or rights and easements to any property |
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needed by an authority to effect its purposes in connection with the |
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acquisition, construction, operation, or improvement of the |
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system. |
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(f) An authority has the right of eminent domain to acquire |
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real property in fee simple or an interest in real property less |
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than fee simple in, on, under, or above land, including an easement, |
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right-of-way, or right of use of airspace or subsurface space. The |
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power of eminent domain under this section does not apply to land |
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under the jurisdiction of the department or a rail line owned by a |
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common carrier or municipality. An authority shall, to the extent |
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possible, use existing rail or intermodal transportation corridors |
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for the alignment of its system. A proceeding for the exercise of |
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the power of eminent domain is begun by the adoption by the board of |
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a resolution declaring the public necessity for the acquisition by |
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an authority of the property or interest described in the |
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resolution and that the acquisition is necessary and proper for the |
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construction, extension, improvement, or development of high-speed |
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rail facilities and is in the public interest. The resolution of an |
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authority is conclusive evidence of the public necessity of the |
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proposed acquisition and that the real or personal property or |
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interest in property is necessary for public use. |
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(g) With the consent of the property owner, instead of |
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paying for real property with a single fixed payment, an authority |
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may pay the owner in the form of: |
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(1) an intangible legal right to receive a percentage |
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of identified fees related to the applicable segment of the system; |
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or |
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(2) an exclusive or nonexclusive right to use or |
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operate a part of the system. |
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(h) An authority may make agreements with a public utility, |
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private utility, communication system, common carrier, state |
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agency, or transportation system for the joint use of facilities, |
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installations, or properties inside or outside the border region |
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and establish through routes and joint fares. |
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(i) An authority may adopt rules to govern the operation of |
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the authority, its employees, the system, service provided by the |
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authority, and any other necessary matter concerning its purposes, |
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including rules relating to health, safety, alcohol or beverage |
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service, food service, and telephone and utility services, to |
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protect the health, safety, and general welfare of residents of the |
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border region and people who use the authority's services. |
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(j) An authority may enter into a joint ownership agreement |
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with any person. |
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(k) An authority shall establish and maintain rates or other |
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compensation for the use of the facilities of the system acquired, |
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constructed, operated, regulated, or maintained by the authority |
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that is reasonable and nondiscriminatory and, together with grants |
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received by the authority, is sufficient to produce revenues |
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adequate: |
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(1) to pay all expenses necessary for the operation |
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and maintenance of the properties and facilities of the authority; |
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(2) to pay the interest on and principal of bonds |
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issued by the authority and payable in whole or in part from the |
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revenues, as they become due and payable; and |
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(3) to comply with the terms of an agreement made with |
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the holders of bonds or with any person in their behalf. |
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(l) An authority may make contracts, leases, and agreements |
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with, and accept grants and loans from, the United States, this |
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state, agencies and political subdivisions of this state or another |
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state of the United States, the United Mexican States, or a state of |
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the United Mexican States, and other persons and entities and may |
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perform any act necessary for the full exercise of the powers vested |
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in it. The commission may enter into an interlocal agreement with |
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an authority under which the authority may exercise a power or duty |
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of the commission for the development and efficient operation of an |
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intermodal corridor in the border region. An authority may acquire |
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rolling stock or other property under conditional sales contracts, |
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leases, equipment trust certificates, or any other form of contract |
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or trust agreement. A revenue bond indenture may limit the exercise |
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of the powers granted by this section, and a limit applies as long |
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as the revenue bonds issued under the indenture are outstanding and |
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unpaid. |
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(m) An authority by resolution may adopt rules governing the |
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use, operation, and maintenance of the system and may determine or |
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change a routing as the board considers advisable. |
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(n) An authority may lease all or part of the high-speed |
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rail facilities to, or contract for the use or operation of all or |
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part of the high-speed rail facilities by, an operator. An |
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authority shall encourage to the maximum extent practicable the |
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participation of private enterprise in the operation of high-speed |
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rail facilities. The term of an operating contract under this |
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subsection may not exceed 20 years. |
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(o) An authority may contract with a county or other |
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political subdivision of this state for the authority to provide |
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high-speed rail transportation services to an area outside the |
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border region on the terms and conditions agreed to by the parties. |
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(p) An authority may purchase an additional insured |
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provision to any liability insurance contract. |
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(q) Before beginning the operation of high-speed rail |
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facilities, the board shall adopt an annual operating budget |
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specifying the anticipated revenues and expenses of the authority |
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for the remainder of the fiscal year. Each year the board shall |
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adopt an operating budget for the authority. The fiscal year of an |
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authority ends September 30 unless changed by the board. The board |
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shall hold a public hearing before adopting a budget other than the |
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initial budget. Notice of each hearing must be published at least |
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seven days before the date of the hearing in a newspaper of general |
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circulation in each county in the applicable border region. A |
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budget may be amended at any time if notice of the proposed |
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amendment is given in the notice of the meeting at which the |
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amendment will be considered. An expenditure that is not budgeted |
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may not be made. |
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(r) An authority is eligible to participate in the Texas |
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County and District Retirement System. |
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(s) The board shall by resolution name one or more banks for |
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the deposit of authority funds. Authority funds are public funds |
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and may be invested in securities permitted by Chapter 2256, |
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Government Code. To the extent funds of an authority are not |
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insured by the Federal Deposit Insurance Corporation or its |
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successor, they shall be collateralized in the manner provided for |
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county funds. |
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(t) To provide tax benefits to another party that are |
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available with respect to property under the laws of a foreign |
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country or to encourage private investment with a transportation |
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authority in the United States, and notwithstanding any other |
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provision of this chapter, an authority may enter into and execute, |
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as it considers appropriate, contracts, agreements, notes, |
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security agreements, conveyances, bills of sale, deeds, leases as |
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lessee or lessor, and currency hedges, swap transactions, or |
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agreements relating to foreign and domestic currency. The |
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agreements or instruments may have the terms, maturities, duration, |
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provisions as to governing law, indemnities, and other provisions |
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that are approved by the board. In connection with any transaction |
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authorized by this subsection, the authority shall deposit in |
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trust, escrow, or similar arrangement cash or lawful investments or |
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securities, or shall enter into one or more payment agreements, |
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financial guarantees, or insurance contracts with counterparties |
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having either a corporate credit or debt rating in any form, a |
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claims-paying ability, or a rating for financial strength of "AA" |
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or better by Moody's Investors Service, Inc., or by Standard & |
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Poor's Corporation or "A-" or better by BEST's rating system that, |
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by their terms, including interest to be earned on any cash or |
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securities, are sufficient in amount to pay when due all amounts |
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required to be paid by the authority as rent over the full term of |
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the transaction plus any optional purchase price due under the |
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transaction. A certification in advance by an independent |
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financial expert, banker, or certified public accountant, who is |
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not an employee of the authority, certifying compliance with this |
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requirement constitutes conclusive evidence of compliance. |
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Property sold, acquired, or otherwise transferred under this |
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subsection is considered for all purposes to be property owned and |
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held by the authority and used for public purposes. |
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Sec. 5. BONDS AND NOTES. (a) An authority may issue |
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revenue bonds and notes in amounts the board considers necessary or |
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appropriate for the acquisition, purchase, construction, |
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reconstruction, repair, equipping, improvement, or extension of |
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the authority's high-speed rail facilities. A bond or note is fully |
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negotiable and may be made redeemable before maturity, at the |
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option of the authority and at the price and under the terms the |
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board determines in the resolution authorizing the bond or note and |
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may be sold at public or private sale, as the board determines. |
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(b) An authority shall submit all bonds and notes and the |
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record of proceedings relating to their issuance to the attorney |
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general for examination before delivery. If the attorney general |
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determines that they have been issued in accordance with the |
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constitution and this article and that they will be binding |
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obligations of the authority, the attorney general shall approve |
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them, and the comptroller shall register them. A bond or note |
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issued under this article is incontestable after approval, |
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registration, and sale and delivery of the bond or note to the |
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purchaser. |
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(c) To secure the payment of the bond or note, an authority |
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may encumber and pledge all or any part of the revenues of its |
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high-speed rail facilities, may mortgage and encumber all or part |
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of the property of the high-speed rail facilities and any thing |
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pertaining to them that is acquired or to be acquired, and may |
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prescribe the terms and provisions of the bond or note in any manner |
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not inconsistent with this article. If not prohibited by the |
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resolution or indenture relating to outstanding bonds or notes, an |
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authority may encumber separately any item of real or personal |
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property. |
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(d) A bond or note is a legal and authorized investment for |
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banks, trust companies, savings and loan associations, and |
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insurance companies. The bond or note is eligible to secure the |
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deposit of public funds of this state or a municipality, county, |
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school district, or other political corporation or subdivision of |
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this state. The bond or note is lawful and sufficient security for |
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the deposits to the extent of the principal amount or market value |
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of the bond or note, whichever is less. |
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Sec. 6. COMPETITIVE BIDS. A contract in the amount of more |
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than $15,000 for the construction of improvements or the purchase |
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of material, machinery, equipment, supplies, or any other property |
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other than real property may be let only on competitive bids after |
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notice is published, at least 15 days before the date set for |
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receiving bids, in a newspaper of general circulation in each |
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county in the applicable border region. The board may adopt rules |
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governing the taking of bids and the awarding of contracts. This |
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section does not apply to: |
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(1) personal or professional services; |
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(2) the acquisition of an existing rail transportation |
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system; or |
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(3) a contract with a common carrier to construct |
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lines or to operate high-speed rail service on lines owned in whole |
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or in part by the carrier. |
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Sec. 7. EXEMPTION FROM TAXES. The property, material |
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purchases, revenues, and income of an authority and the interest on |
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a bond or note issued by an authority are exempt from all taxes |
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imposed by this state or a political subdivision of this state. |
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Sec. 8. SALES AND USE TAX. (a) A sales and use tax is |
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imposed on items sold on authority property. The sales and use tax |
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shall be imposed at the rate of the highest combination of local |
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sales and use taxes imposed at the time of the authority's creation |
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in any local governmental jurisdiction in the applicable border |
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region. The comptroller shall remit to the authority the local |
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sales and use tax collected on the authority's property. All other |
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local sales and use taxes that would otherwise be imposed on |
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authority property are abolished by the imposition of this tax. |
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(b) The comptroller shall administer, collect, and enforce |
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a tax imposed under this article. Chapter 321, Tax Code, governs |
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the computation, administration, governance, and use of the tax |
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except as inconsistent with this article. |
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(c) An authority shall notify the comptroller in writing by |
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registered or certified mail of the authority's creation and of its |
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intent to impose the sales and use tax under this article. The |
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authority shall provide to the comptroller all information required |
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to implement the tax, including: |
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(1) an adequate map showing the property boundaries of |
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the authority; and |
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(2) a certified copy of the resolution of the |
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authority board adopting the tax. |
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(d) Not later than the 30th day after the date the |
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comptroller receives the notice, map, and other information, the |
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comptroller shall inform the authority of whether the comptroller |
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is prepared to administer the tax. |
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(e) At the same time an authority notifies the comptroller |
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under Subsection (c) of this section, the authority shall notify |
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each affected local governmental unit of the authority's creation |
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and provide each with an adequate map showing the property |
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boundaries of the authority. |
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(f) Not later than the 30th day after the date an authority |
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adds territory to the authority, the authority shall notify the |
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comptroller and each affected local governmental unit of the |
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addition. The authority must include with each notification an |
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adequate map showing the new boundaries of the authority and the |
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date the additional territory was added. Not later than the 30th |
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day after the date the comptroller receives the notice under this |
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subsection, the comptroller shall inform the authority of whether |
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the comptroller is prepared to administer the tax in the additional |
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territory. |
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(g) A tax imposed under this section or the abolition of a |
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tax under Subsection (a) of this section takes effect on the first |
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day of the first complete calendar quarter that occurs after the |
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expiration of the first complete calendar quarter that occurs after |
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the date the comptroller receives a notice of the action as required |
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by this section. |
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SECTION 2. This Act takes effect September 1, 2007. |