Header:
Texas Annotated Statutes
TEXAS CIVIL STATUTES
TITLE 32. CORPORATIONS
Date:
08/31/2009
Document:
Art. 1528m. Cultural Education Facilities Finance Corporation Act
Short Title
Sec. 1. This Act may be cited as the Cultural Education Facilities Finance Corporation Act.
Legislative Findings
Sec. 2. (a) The legislature finds that:
(1) the health, education, and general welfare of the people of this state require the development of new and expanded cultural and community facilities for the purpose of:
(A) exhibition and promotion of and education about the performing, dramatic, visual, and literary arts; the culture and history of races, ethnic groups, and national heritage groups; and history, natural history, and science;
(B) promotion of and education about health and physical fitness, public health and safety, conservation and preservation of the environment or natural resources, child care, adoption, children's services, substance abuse counseling, family counseling, and care of persons who are elderly or disabled;
(C) administering the provision and granting of charitable services and grants in accomplishment of the purposes described by Paragraph (B) of this subdivision;
(D) promotion of and education about activities devoted to general cultural improvement, including scouting programs and programs by which agencies seek to provide facilities for retreats in urban or rural settings;
(E) support of agencies devoted to the eradication, elimination, or amelioration of one or more diseases or afflictions affecting health or improving the condition of individuals or groups within a community; and
(F) provision of public health and safety and charitable services to communities in times of catastrophe or disaster;
(2) the existence, development, and expansion of cultural facilities are essential to the continuing education, health, general welfare, and comfort of the citizens of this state;
(3) the means and measures authorized and the assistance provided by this Act are in the public interest and serve a public purpose in promoting the health, education, and general welfare of the people of this state by securing and maintaining cultural facilities and the resulting advancement of culture and civilization;
(4) qualified cultural organizations in this state have invested substantial funds in useful and beneficial cultural facilities and have experienced difficulty in undertaking additional projects because of the partial inadequacy of their own funds or of funds potentially available from local subscription sources and because of limitations of local financial institutions in providing necessary financing for these facilities; and
(5) the enactment of this Act will:
(A) secure for present and future generations the benefits and nurturance derived from these cultural facilities; and
(B) enhance the public health and welfare of communities receiving the benefit of the cultural facilities.
(b) This Act shall be liberally construed to carry out the intention of the legislature.
Definitions
Sec. 3. In this Act:
(1) "Board" means the board of directors of a cultural education facilities finance corporation.
(2) "Bond" means a bond, note, interim certificate, or other evidence of indebtedness of a corporation issued under this Act.
(3) "Corporation" means a cultural education facilities finance corporation created under this Act.
(4) "Cost," as applied to a cultural facility, means the cost of the cultural facility including:
(A) the cost of the acquisition of land or a right-of-way, option to purchase land, easement, leasehold estate in land, or other interest in land related to the cultural facility;
(B) the cost of acquisition, construction, repair, renovation, remodeling, or improvement of a building or structure to be used as or in conjunction with the cultural facility;
(C) the cost of site preparation, including the cost of demolishing or removing a building or structure the removal of which is necessary or incident to providing the cultural facility;
(D) the cost of architectural, engineering, legal, and related services; the cost of the preparation of a plan, specification, study, survey, or estimate of cost and revenue; and other expenses necessary or incident to planning, providing, or determining the feasibility and practicability of the cultural facility;
(E) the cost of machinery, equipment, furnishings, and facilities necessary or incident to the equipping of the cultural facility so that it may be placed in operation;
(F) the cost of finance charges, interest, marketing, and start-up of the cultural facility before and during construction and for not more than two years after completion of construction;
(G) costs paid or incurred in connection with the financing of the cultural facility, including out-of-pocket expenses; bond insurance; a letter of credit, standby bond purchase agreement, or liquidity facility; financing, legal, accounting, financial advisory, and appraisal fees; expenses and disbursements; a policy of title insurance; printing, engraving, and reproduction services; and the initial or acceptance fee of a trustee, paying agent, remarketing agent, tender agent, or indexing agent; and
(H) direct and indirect costs of the corporation incurred in connection with providing the cultural facility, including reasonable sums to reimburse the corporation for time spent by its agents or employees in providing and financing the cultural facility.
(5) "Cultural facility" means:
(A) real property or an interest in real property, including buildings and improvements, or equipment, furnishings, or other personal property that:
(i) is found by the board to be necessary or convenient to finance, refinance, acquire, construct, enlarge, remodel, renovate, improve, furnish, or equip for cultural education or community benefit;
(ii) is made available for use by the general public, the user, or community groups; and
(iii) is used for a purpose described by Section 2(a)(1) of this Act; and
(B) facilities incidental, subordinate, or related to or appropriate in connection with property described by Paragraph (A) of this subdivision, located within the state, regardless of the date of construction or acquisition.
(6) "Director" means a member of a board.
(7) "Resolution" means a resolution, order, ordinance, or other official action by a governing body of a sponsoring city or county.
(8) "User" means a nonprofit corporation exempt from the state franchise tax under Section 171.063, Tax Code, an organization described in Section 11.18, Tax Code, or an organization described in Section 501(c)(3), Internal Revenue Code of 1954, that will own, use, operate, or develop a cultural facility after the financing, acquisition, or construction of the cultural facility.
(9) "Furnishings" shall include but not be limited to works of art, books, artifacts, scientific instruments, stage sets, musical scores, collections, and other property necessary or useful for the purposes of the cultural facility.
Creation of Corporations; Powers; Issuance of Bonds
Sec. 4. (a) A city or county may create a nonmember, nonstock, public, cultural educational facilities finance corporation for the sole purpose of acquiring, constructing, providing, improving, financing, and refinancing cultural facilities for the public purposes stated in this Act.
(b) The corporation shall be created and organized in the same manner and has the same powers, authority, and rights:
(1) with respect to cultural facilities and health facilities that a health facilities development corporation has with respect to health facilities under Chapter 221, Health and Safety Code; and
(2) with respect to educational facilities, housing facilities, and other facilities incidental, subordinate, or related to those facilities that a nonprofit corporation created under Section 53.35(b), Education Code, or an authority created under Section 53.11, Education Code, has under Chapter 53, Education Code.
(c) The powers of a corporation under Subsection (b) include the power to acquire, purchase, lease, mortgage, and convey property with respect to a facility; borrow money by issuing bonds, notes, and other obligations; lend money for its corporate purposes; invest and reinvest its funds; and secure its bonds, notes, and obligations by mortgaging, pledging, assigning, or otherwise encumbering its property or assets.
(d) Regardless of any provision in Chapter 221, Health and Safety Code, or Chapter 53, Education Code, the authority of the corporation may be exercised inside or outside the limits of the city that created the corporation if the city is located in a county with a population of more than 300,000 or inside or outside the limits of the county that created the corporation if the county has a population of more than 300,000. The authority may be exercised without the consent or other action of any person that would otherwise be required under Chapter 221, Health and Safety Code, or Chapter 53, Education Code, unless the articles of incorporation or bylaws of the corporation provide differently. The authority of a corporation under this section shall not preempt the police powers of any sponsoring entity or any other laws regulating or empowering sponsoring entities to regulate the activities of the corporation.
Limitation on Corporate Purposes
Sec. 4A. (a) A city or county that creates a corporation under this Act may limit the corporation's purposes in the proceedings directing the creation of the corporation by prohibiting the corporation from financing particular types of cultural facilities, including a cultural facility to be used for a purpose specified in the proceedings.
(b) As a condition of providing financing, a corporation may restrict a person receiving financing from using a cultural facility for a particular purpose.
(c) A restriction imposed by a city or county on a corporation may be enforced by the governing body of the sponsoring entity by injunction or mandamus.
(d) A violation of a restriction by a corporation may not impair the validity of the obligations incurred by the corporation.
Construction
Sec. 5. (a) If this Act conflicts with a provision of another law, this Act prevails.
(b) If a procedure under this Act is held by a court to be unconstitutional, a corporation by resolution may provide an alternate procedure conforming to the constitution. It is the intent of the legislature that a corporation authorized under this Act is a public corporation, constituted authority, and instrumentality authorized to issue bonds on behalf of the city or county on behalf of which the corporation is created, all within the meaning of Section 103, Internal Revenue Code of 1954, and the regulations adopted and rulings issued under that section, and this Act shall be construed accordingly.
(c) Except as provided by this Act, a corporation formed under this Act has the same rights and powers as a corporation organized under the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
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