Texas Bond Review Board Strategic Plan: Fiscal Years 2013-2017 Page: 14
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The Tax Reform Act of 1986 also made substantial changes in the use of private activity debt. The
Act narrowed the definition of projects eligible for tax-exempt financing and imposed a volume
ceiling on the aggregate principal amount of tax-exempt private activity bonds that may be issued
within each state during any calendar year. For Texas, the volume ceiling imposed by the Act is
currently $95 per capita or $225 million, whichever is greater. Due to Texas' large population, to
date the per capita ceiling has yielded the larger number. Beginning January 1, 2003, the state ceiling
was indexed to inflation.
In 1990 the state's ceiling was $849.6 million, but by 2012 the ceiling had grown to $2.44 billion. The
volume cap for Texas has thus increased by 187.7% from 1990 to 2012 due to Texas' increasing
population. However, it is important to note that from 2008 to 2012, the volume cap allotted to
Texas has grown 20.0%, but during the same time period unused volume cap ("carryforward") has
grown by 304.8%, from $729.2 million to $2.95 billion. The total effective size of the state's volume
cap and carryforward reached $5.39 billion in 2012.
In October 2008 the president signed into law the Heartland Disaster Tax Relief Act of 2008 (the
"Act") which included changes to the federal tax law designed to provide economic relief to the
Hurricane Ike Disaster Area. The Act allows for the issuance of certain tax exempt, qualified
Hurricane Ike disaster area bonds to provide financing in the Hurricane Ike disaster area through
December 31, 2012. The Governor must designate such bonds as qualified Hurricane Ike disaster
area bonds on the basis of providing assistance to areas in the order in which such assistance is most
needed. The BRB has signed a Memorandum of Understanding with the Governor's Office
outlining the agency's administrative role of processing applications and recordkeeping for the
Hurricane Ike disaster area bonds.
In February 2009 the American Recovery and Reinvestment Act of 2009 (ARRA) created four types
of bonding authority and expanded authority under three existing programs. The four types of
bonding authority created were Build America Bonds (BAB), Recovery Zone Economic
Development Bonds (RZEDB), Recovery Zone Facility Bonds (RZFB) and Qualified School
Construction Bonds (QSCB). The three expanded programs were Qualified Zone Academy Bonds
(QZAB), Qualified Energy Conservation Bonds (QECB) and Clean Renewable Energy Bonds. The
BRB was designated by the Governor as the administrator of RZEDBs, RZFBs, and QECBs.
Impact of Anticipated State Statutory Changes
Statutory changes relating to additional debt-issuance authority are expected to have a minimal
impact on the agency's operations. The 81St Legislature appropriated funds for additional general
obligation debt that was approved by the voters at the November 2007 general election. These
include Senate Joint Resolution (SJR) 64 to finance $5.00 billion for transportation projects; SJR 57
to finance $500.0 million for student loans; and SJR 20 to finance $250.0 million for water projects
of the 80th Legislature. Additionally, the 81t Legislature provided the Texas Public Finance Authority
with the authority to issue a total of $4.00 billion in new debt, $3.00 billion of which is designated
for the Cancer Prevention Research Institute of Texas for cancer research and prevention over 10
years. Although issuances under these authorizations continue, the time required for staff to analyze
issuance applications and track debt service for them has been absorbed into the overall mix of staff
functions.14
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Texas Bond Review Board. Texas Bond Review Board Strategic Plan: Fiscal Years 2013-2017, book, July 2, 2012; Austin, Texas. (https://texashistory.unt.edu/ark:/67531/metapth531984/m1/17/?rotate=0: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.