Bill

SB 1657

84(R) - 2015
Senate Finance
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Senate Finance
Debt

Vote Recommendation

Neutral
  • Neutral
  • Neutral
  • Neutral
  • Neutral
  • Neutral

Author(s)

Kirk Watson

Bill Caption

Relating to approval of the issuance of tax and revenue anticipation notes.

Fiscal Notes

A fiscal note dated April 6, 2015 anticipates no fiscal implication to the State or units of local government.

Bill Analysis

Senate Bill 1657 would amend the Government code to add "commercial paper notes" to the definition of "Tax and revenue anticipation notes."

It would allow for tax and revenue anticipation notes' subsequent approvals by the Cash Management Committee to expire on the 91st day (instead of 61st currently) after the date the hearing on which the approval was based concludes.

It would also allow for the issuance of commercial paper notes to expire, not on the 91st day after the date the hearing conducted by the cash management committee to approve of the issuance of notes takes place, but on the last day of the fiscal year for which the tax and revenue anticipation notes are approved. Commercial paper notes would have to mature and be paid in full in accordance with Government Code 404.123(d).

The second chamber sponsor is Representative Rick Miller.

Vote Recommendation Notes

5/15/15 Update:

No amendments or modifications have been made to the bill since we reported on it. We continue to remain neutral.

First chamber analysis below:

Commercial paper notes are short-term obligations that mature in 270 days. Senate Bill 1657 would give slightly more flexibility to the State by allowing for the issuance and rollover of these notes during the entire fiscal year for which they would have been approved by the Cash Management Committee. According to the author's office's analysis, they have been "used by the state only five times since 1986 to assist in the management of the state's cash flow needs." All commercial paper notes would have to mature and be paid in full during the fiscal biennium in which they were issued.

The bill would also allow for subsequent to first time issuance of Tax and revenue anticipation notes (TRAN) in a fiscal year, to expire in the same period of time as for the first issuance.

Because these changes only give slightly more flexibility to issue or rollover notes to the Comptroller and do not affect our principles, we will remain neutral on Senate Bill 1657.