By: Clardy, et al. (Senate Sponsor - Springer)	H.B. No. 1515
	(In the Senate - Received from the House April 17, 2023;
	April 19, 2023, read first time and referred to Committee on
	Natural Resources & Economic Development; May 15, 2023, reported
	adversely, with favorable Committee Substitute by the following
	vote:  Yeas 7, Nays 0; May 15, 2023, sent to printer.)
Click here to see the committee vote
	COMMITTEE SUBSTITUTE FOR H.B. No. 1515	By:  Zaffirini

	COMMITTEE VOTE
	YeaNayAbsentPNV
	BirdwellX
	ZaffiriniX
	AlvaradoX
	BlancoX
	HancockX
	HughesX
	KolkhorstX
	MilesX
	SparksX
	A BILL TO BE ENTITLED
	AN ACT
	relating to the continuation and functions of and certain programs
	subject to rules adopted by the Texas Economic Development and
	Tourism Office.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 481.003, Government Code, is amended to
	read as follows:
	Sec. 481.003.  SUNSET PROVISION. The Texas Economic
	Development and Tourism Office is subject to Chapter 325 (Texas
	Sunset Act).  Unless continued in existence as provided by that
	chapter, the office is abolished [and this chapter expires]
	September 1, 2035 [2023].
	SECTION 2.  Section 481.0066, Government Code, is amended by
	amending Subsection (d) and adding Subsection (f) to read as
	follows:
	(d)  The aerospace and aviation office shall:
	(1)  analyze space-related and aviation-related
	research currently conducted in this state and may conduct
	activities designed to further that research;
	(2)  analyze the state's economic position in the
	aerospace and aviation industries;
	(3)  develop short-term and long-term business
	strategies as part of an industry-specific strategic plan to
	promote the retention, development, and expansion of aerospace and
	aviation industry facilities in the state that is consistent with
	and complementary of the office strategic plan;
	(4)  [make specific recommendations to the legislature
	and the governor regarding the promotion of those industries;
	[(5)] as part of and to further the purposes of the
	industry-specific strategic plan described by Subdivision (3),
	develop short-term and long-term policy initiatives or recommend
	reforms the state may undertake or implement to:
	(A)  increase investment in aerospace and
	aviation activities;
	(B)  support the retention, development, and
	expansion of spaceports in this state;
	(C)  identify and encourage educational,
	economic, and defense-related opportunities for aerospace and
	aviation activities;
	(D)  determine the appropriate level of funding
	for the spaceport trust fund created under Section 481.0069 and
	support ongoing projects that have been assisted by the fund,
	including recommending to the legislature an appropriate funding
	level for the fund;
	(E)  partner with the Texas Higher Education
	Coordinating Board to foster technological advancement and
	economic development for spaceport activities by strengthening
	higher education programs and supporting aerospace activities; and
	(F)  partner with the Texas Workforce Commission
	to support initiatives that address the high technology skills and
	staff resources needed to better promote the state's efforts in
	becoming the leading space exploration state in the nation;
	(5) [(6)]  act as a liaison with other state and
	federal entities with related economic, educational, and defense
	responsibilities to support the marketing of the state's aerospace
	and aviation capabilities;
	(6) [(7)]  provide technical support and expertise to
	the state and to local spaceport authorities regarding aerospace
	and aviation business matters; and
	(7) [(8)]  be responsible for the promotion and
	development of spaceports in this state.
	(f)  Chapter 2110 does not apply to the size, composition, or
	duration of the aerospace and aviation advisory committee.
	SECTION 3.  Section 481.00681, Government Code, is amended
	by adding Subsection (i) to read as follows:
	(i)  Chapter 2110 does not apply to the size, composition, or
	duration of the task force.
	SECTION 4.  Subchapter B, Chapter 481, Government Code, is
	amended by adding Section 481.0211 to read as follows:
	Sec. 481.0211.  ADVISORY COMMITTEES. (a)  The office by rule
	may establish advisory committees to make recommendations to the
	office on programs, rules, and policies administered by the office.
	(b)  In establishing an advisory committee under this
	section, the office shall adopt rules, including rules regarding:
	(1)  the purpose, role, responsibility, goals, and
	duration of the committee;
	(2)  the size of and quorum requirement for the
	committee;
	(3)  qualifications for committee membership;
	(4)  appointment procedures for members;
	(5)  terms of service for members;
	(6)  training requirements for members;
	(7)  policies to avoid conflicts of interest by
	committee members;
	(8)  a periodic review process to evaluate the
	continuing need for the committee; and
	(9)  policies to ensure the committee does not violate
	any provisions of Chapter 551 applicable to the office or the
	committee.
	SECTION 5.  Section 481.022, Government Code, is amended to
	read as follows:
	Sec. 481.022.  GENERAL DUTIES OF OFFICE. The office shall:
	(1)  market and promote the state as a premier business
	location and tourist destination;
	(2)  facilitate the location, expansion, and retention
	of domestic and international business investment to the state;
	(3)  promote and administer business and community
	economic development programs and services in the state, including
	business incentive programs;
	(4)  provide to businesses and communities in the state
	assistance with exporting products and services to international
	markets;
	(5)  serve as a central source of economic research and
	information; [and]
	(6)  establish a statewide strategy to address economic
	growth and quality of life issues, a component of which is based on
	the identification and development of industry clusters; and
	(7)  develop a plan to engage with stakeholders to
	gather input and solicit feedback on the development of rules
	promulgated by the office related to lending programs, including
	participant selection, requirements for borrowers, terms of loans,
	requirements for disbursement of funds, and other aspects of
	program administration.
	SECTION 6.  Section 481.172, Government Code, is amended by
	amending Subsection (b) and adding Subsection (b-1) to read as
	follows:
	(b)  A memorandum of understanding entered into under
	Subsection (a)(8) shall provide that the office may:
	(1)  strategically direct and redirect each agency's
	tourism priorities and activities to:
	(A)  most effectively meet consumer demands and
	emerging travel trends, as established by the latest market
	research; and
	(B)  minimize duplication of efforts and realize
	cost savings through economies of scale;
	(2)  require each agency to submit to the office for
	advance approval:
	(A)  resources, activities, and materials related
	to the promotion of tourism proposed to be provided by the agency;
	(B)  a biennial plan of action for the agency's
	proposed tourism activities [, not later than June 1 of each year,]
	that includes:
	(i)  priorities identified by the agency
	that must include marketing, product development, and program
	development;
	(ii)  the agency's proposed budget for
	tourism activities; and
	(iii)  measurable goals and objectives of
	the agency related to the promotion of tourism; and
	(C)  any proposed marketing message, material,
	logo, slogan, or other communication to be used by the agency in its
	tourism-related efforts, to assist the office in coordinating
	tourism-related efforts conducted in this state by the agency and
	the office and conducted outside of this state by the office;
	(3)  direct the development of a biennial [an annual]
	strategic tourism plan, including a marketing plan, to increase
	travel to this state, that:
	(A)  provides the most effective and efficient
	expenditure of state funds for in-state marketing activities
	conducted by the agencies and encouraged by the office and
	out-of-state marketing activities conducted by the office;
	(B)  establishes goals, objectives, and
	performance measures, including the measurement of the return on
	the investment made by an agency or the office, for the
	tourism-related efforts of all state agencies; and
	(C)  is developed not later than December
	[September] 1 of each even-numbered year; and
	(4)  direct the agencies to share costs related to
	administrative support for the state's tourism activities.
	(b-1)  The office may, using the input of each agency that is
	a party to a memorandum of understanding under Subsection (a)(8),
	establish procedures for the submission of the plan required under
	Subsection (b)(2)(B).
	SECTION 7.  Section 481.406, Government Code, is amended by
	adding Subsection (d) to read as follows:
	(d)  The office shall by rule develop:
	(1)  procedures for disbursement of money to borrowers
	and lending partners for access to capital programs; and
	(2)  documentation and recovery effort requirements of
	a participating partner for a claim against a reserve account.
	SECTION 8.  Section 489.105(b), Government Code, is amended
	to read as follows:
	(b)  The fund consists of:
	(1)  appropriations for the implementation and
	administration of this chapter;
	(2)  [investment earnings under the original capital
	access fund established under Section 481.402;
	[(3)]  fees charged under Subchapter BB, Chapter 481;
	(3) [(4)]  interest earned on the investment of money
	in the fund;
	(4) [(5)]  fees charged under this chapter;
	(5) [(6)]  investment earnings from the programs
	administered by the bank;
	(6) [(7)]  amounts transferred under Section
	2303.504(b)[, as amended by Article 2, Chapter 1134, Acts of the
	77th Legislature, Regular Session, 2001];
	(7) [(8)]  investment earnings under the Texas product
	development fund under Section 489.211;
	(8) [(9)]  investment earnings under the Texas small
	business incubator fund under Section 489.212; and
	(9) [(10)]  any other amounts received by the state
	under this chapter.
	SECTION 9.  Section 489.107, Government Code, is amended to
	read as follows:
	Sec. 489.107.  ANNUAL REPORT.  (a)  On or before January 1 of
	each year, the office shall submit to the legislature an annual
	status report on the activities of the bank.
	(b)  The report under Subsection (a) must include for each
	program administered by the office:
	(1)  the number of grants, loans, and designations
	awarded in the previous fiscal year;
	(2)  the total number of grants, loans, and
	designations awarded by the bank;
	(3)  the amount in dollars of all grants, loans, and
	designations described by Subdivisions (1) and (2);
	(4)  the number of applications received in the
	previous fiscal year;
	(5)  the number of outstanding loans and designations;
	(6)  a summary of each outstanding loan and
	designation, including the amount outstanding and the terms of the
	loan or designation;
	(7)  the balance of each program's fund and any reserve
	account; and
	(8)  any challenges in administering each program,
	including any proposals for statutory changes that would address
	the challenges.
	(c)  For the small business disaster recovery loan program,
	the report must include a general description of each small
	business for which an applicant was awarded a loan from the fund
	during the preceding fiscal year.
	(d)  In preparing the report under Subsection (a), the office
	shall remove any identifying information pertaining to program
	participants.
	SECTION 10.  Sections 489.211(a) and (b), Government Code,
	are amended to read as follows:
	(a)  The Texas product development fund is a [revolving] fund
	in the state treasury.
	(b)  The product fund is composed of proceeds of bonds issued
	under this subchapter, financing application fees, loan
	repayments, guarantee fees, royalty receipts, dividend income,
	money appropriated by the legislature for authorized purposes of
	the product fund, amounts received by the state from loans, loan
	guarantees, and equity investments made under this subchapter,
	amounts received by the state from federal grants or other sources,
	[amounts transferred from the original capital access fund under
	Section 481.415,] and any other amounts received under this
	subchapter and required by the bank to be deposited in the product
	fund.  The product fund contains a program account, an interest and
	sinking account, and other accounts that the bank authorizes to be
	created and maintained.  Money in the product fund is available for
	use by the bank [board] under this subchapter.  Investment earnings
	under the product fund must be transferred to the fund created under
	Section 489.105.  Notwithstanding any other provision of this
	subchapter, any money in the product fund may be used for debt
	service, bond redemption, or any costs associated with debt service
	or bond redemption.
	SECTION 11.  Sections 489.212(a) and (b), Government Code,
	are amended to read as follows:
	(a)  The Texas small business incubator fund is a [revolving]
	fund in the state treasury.
	(b)  The small business fund is composed of proceeds of bonds
	issued under this subchapter, financing application fees, loan
	repayments, guarantee fees, royalty receipts, dividend income,
	money appropriated by the legislature for authorized purposes of
	the small business fund, amounts received by the state from loans,
	loan guarantees, and equity investments made under this subchapter,
	amounts received by the state from federal grants or other sources,
	[amounts transferred from the original capital access fund under
	Section 481.415,] and any other amounts received under this
	subchapter and required by the bank to be deposited in the small
	business fund.  The small business fund contains a project account,
	an interest and sinking account, and other accounts that the bank
	authorizes to be created and maintained.  Money in the small
	business fund is available for use by the bank [board] under this
	subchapter.  Investment earnings under the small business fund
	must be transferred to the fund created under Section
	489.105.  Notwithstanding any other provision of this subchapter,
	any money in the small business fund may be used for debt service,
	bond redemption, or any costs associated with debt service or bond
	redemption.
	SECTION 12.  Section 489.215(b), Government Code, is amended
	to read as follows:
	(b)  This section applies to information in any form provided
	by or on behalf of an applicant for financing or a recipient of
	financing under this subchapter, including information contained
	in, accompanying, or derived from any application or report, that
	relates to a product, to the development, application, manufacture,
	or use of a product, or to the markets, market prospects, or
	marketing of a product and that is proprietary information of
	actual or potential commercial value to the applicant or recipient
	that has not been disclosed to the public.  Confidential
	information includes scientific and technological information,
	including computer programs and software, and marketing and
	business operation information, regardless of whether the product
	to which the information relates is patentable or capable of being
	registered under copyright or trademark laws or has a potential for
	being sold, traded, or licensed for a fee.  This section does not
	make confidential information in an account, voucher, or contract
	relating to the receipt or expenditure of public funds by the bank,
	board, or the department or its successor under this subchapter.
	This section applies to any information collected in winding up the
	product development and small business incubator program
	investment portfolio under Subchapter D-1.
	SECTION 13.  Chapter 489, Government Code, is amended by
	adding Subchapter D-1 to read as follows:
	SUBCHAPTER D-1.  WINDING UP OF PRODUCT DEVELOPMENT AND SMALL
	BUSINESS INCUBATOR PROGRAM
	Sec. 489.221.  MANAGEMENT OF INVESTMENT PORTFOLIO; WINDING
	UP AND FINAL LIQUIDATION.  (a)  In this section, "product
	development and small business incubator program investment
	portfolio" means:
	(1)  the equity positions in the form of stock or other
	security the bank took, on behalf of the state, in companies that
	received financing under the product development and small business
	incubator program; and
	(2)  any other investments made by the bank, on behalf
	of the state, and associated assets in connection with financing
	made under the product development and small business incubator
	program.
	(b)  The bank shall manage and wind up the product
	development and small business incubator program investment
	portfolio, including revenues and associated assets from financing
	and defaults on financing, in a manner that, to the extent feasible,
	provides for the maximum return on the state's investment.  In
	managing those investments and associated assets through
	procedures and subject to restrictions that the bank considers
	appropriate, the bank may acquire, exchange, sell, supervise,
	manage, or retain any kind of investment or associated assets that a
	prudent investor, exercising reasonable care, skill, and caution,
	would acquire or retain in light of the purposes, terms,
	distribution requirements, and other circumstances then prevailing
	pertinent to each investment or associated asset.  The bank may
	recover its reasonable and necessary costs incurred in the
	management of the portfolio, including costs incurred in the
	retaining of professional or technical advisors, from the earnings
	on the investments in the portfolio.
	(c)  On completion of the winding up process under Subsection
	(b), the bank shall deposit any remaining investment earnings to
	the credit of the Texas economic development bank fund, as required
	under Sections 489.211 and 489.212.
	(d)  The bank has any power necessary to accomplish the
	purposes of this section.
	SECTION 14.  Section 2303.003(7), Government Code, is
	amended to read as follows:
	(7)  "Qualified employee" means a person who:
	(A)  is a resident of this state;
	(B)  works for a qualified business;
	(C) [(B)]  receives wages from the qualified
	business from which employment taxes are deducted; and
	(D)  meets one of the following qualifications:
	(i) the person [(C)] performs at least 50
	percent of the person's service for the business at the qualified
	business site;
	(ii)  [, or] if the person engages in the
	transportation of goods or services, the person reports to the
	qualified business site and resides within 50 miles of the
	qualified business site; or
	(iii)  if the person engages in services
	off-site, the person is assigned to the qualified business site and
	resides within 25 miles of the qualified business site.
	SECTION 15.  Section 2303.4052, Government Code, is amended
	to read as follows:
	Sec. 2303.4052.  REQUIRED INFORMATION FROM NOMINATING BODY.
	(a)  Before nominating the project or activity of a qualified
	business for designation as an enterprise project, the nominating
	body must submit to the bank:
	(1)  a certified copy of the ordinance or order, as
	appropriate, or reference to an ordinance or order as required by
	Section 2303.4051;
	(2)  a certified copy of the minutes of all public
	hearings conducted with respect to local incentives available to
	qualified businesses within the jurisdiction of the governmental
	entity nominating the project or activity, regardless of whether
	those businesses are located in an enterprise zone;
	(3)  the name, title, address, telephone number, and
	electronic mail address of the nominating body's liaison designated
	under Section 2303.204;
	(4)  if the business is seeking job retention benefits,
	documentation showing the number of employment positions at the
	qualified business site;
	(5)  any interlocal agreement required under Section
	2303.004(c) that states:
	(A)  which governing body has the administration
	authority under Section 2303.201; and
	(B)  that both the county in which the project or
	activity is located and the municipality in whose jurisdiction the
	project or activity is located approve the nomination of the
	project or activity; and
	(6)  any additional information the bank may require.
	(b)  The nominating body may electronically submit in a
	manner prescribed by the bank a digital scan of a certified copy of
	the documentation required by Subsections (a)(1) and (2).
	SECTION 16.  The following provisions of the Government Code
	are repealed:
	(1)  Sections 481.0066(d-1) and (d-2);
	(2)  Section 481.401(6-a);
	(3)  Sections 481.406(b) and (c);
	(4)  Sections 481.402, 481.404, 481.405, 481.407,
	481.408, 481.409, 481.410, 481.412(a), 481.415, 481.458, 481.609,
	and 489.307; and
	(5)  Sections 489.201, 489.202, 489.203, 489.204,
	489.205, 489.206, 489.207, 489.208, 489.209, 489.210, 489.211(c),
	489.212(c), 489.213, 489.214, 489.215(c), 489.216, and 489.217.
	SECTION 17.  Not later than December 1, 2024, the Texas
	Economic Development and Tourism Office shall submit the first
	biennial strategic tourism plan required by Section 481.172(b)(3),
	Government Code, as amended by this Act.
	SECTION 18.  A member of an advisory committee repealed by
	this Act may be reappointed to serve as a member of a new advisory
	committee established under Section 481.0211, Government Code, as
	added by this Act.
	SECTION 19.  (a) Except as provided by Subsection (b) of
	this section, Section 2303.003, Government Code, as amended by this
	Act, applies to an application for an enterprise project
	designation under the enterprise zone program under Chapter 2303,
	Government Code, as amended by this Act, that is submitted on or
	after the effective date of this Act. An application for an
	enterprise project designation under the enterprise zone program
	that is submitted before the effective date of this Act is governed
	by the law in effect on the date the application was submitted, and
	the former law is continued in effect for that purpose.
	(b)  Section 2303.003(7)(D), Government Code, as added by
	this Act, applies to an enterprise project that is under audit or
	subject to audit by the comptroller of public accounts on or after
	the effective date of this Act.
	SECTION 20.  This Act takes effect September 1, 2023.
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