TPTRP TRANSITION BOARD ACT
House Bill · Tex. Gov't Code ch. 490
Establishes Chapter 490, Government Code — the Transition Board, Assistance Eligibility Standard, and
Texas Sales and Use Tax Portal.
By: ______________________
H.B. No. ______
A BILL TO BE ENTITLED
AN ACT relating to the establishment of the TPTRP Transition Board, the TPTRP
Transition Fund, and the TPTRP Transition Monitoring Division of the Texas Comptroller of Public
Accounts to ensure fiscal continuity for all taxing entities of this state during the transition from ad
valorem property taxation to the sales and use tax system; superseding Government Code Chapter 490 as
enacted by the TPTRP Bond Management Act; making an appropriation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. GOVERNMENT CODE CHAPTER 490 — TPTRP TRANSITION BOARD, FUND, AND TRANSITION PLAN
SECTION 1.01.
Subtitle D, Title 4, Government Code, is amended by adding Chapter 490 to read as
follows, superseding all prior enactments of Chapter 490:
CHAPTER 490. TPTRP TRANSITION BOARD, TRANSITION FUND, AND TRANSITION PLAN
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 490.001. DEFINITIONS.
In this chapter:
(1) "Board" means the TPTRP Transition Board established under Subchapter C, as
authorized by Article VIII, Section 1-u, of the Texas Constitution.
(2) "CCR" means the Constitutional Cap Rate — the maximum sales and use tax rate
permitted by the Texas Constitution for each tier under Article VIII, Section 1-n(b), of the Texas
Constitution — as follows:
(A) for Tier 1 (the State), two percent;
(B) for Tier 2 (counties and county-area special districts absorbed under the
TPTRP implementing legislation), one percent;
(C) for Tier 3 (municipalities and city-area special districts absorbed under the
TPTRP implementing legislation), one percent;
(D) for Tier 4 (independent school districts), one and one-half percent; and
(E) for Tier 5 (statewide special districts), one-half percent in the aggregate at
any Texas location, apportioned among overlapping Tier 5 districts as provided by the TPTRP Sales and
Use Tax Act.
The sum of the rates applied at any single Texas location across all applicable tiers
may not exceed six percent (the "combined constitutional ceiling"). The CCR is an absolute
constitutional ceiling and not merely a threshold triggering a voter election. No taxing entity may
impose, and no election may authorize, a rate in excess of the CCR applicable to that entity's tier
or the combined constitutional ceiling at any location within that entity's jurisdiction.
(3) "Comptroller" means the Texas Comptroller of Public Accounts.
(4) "Division" means the TPTRP Transition Monitoring Division established under
Subchapter H.
(5) "Eligible entity" means a taxing entity that meets the eligibility conditions
established under Section 490.032.
(6) "Final Year Baseline" means the Comptroller-certified sum of an entity's
actual final-year revenue from every source the entity is losing under the TPTRP, as established under
Section 490.015. For every taxing entity, the Final Year Baseline includes:
(A) the entity's final-year ad valorem property tax collections, both M&O
and I&S components;
(B) the entity's final-year sales and use tax collections at the rate in
effect immediately before the Implementation Date;
(C) the entity's final-year revenue from every other tax abolished by Article
VIII, Section 1-m(c), of the Texas Constitution that the entity levied or of which the entity received a
dedicated share, including without limitation hotel occupancy tax, mixed beverage tax, venue-project
tax, motor fuel tax dedications, oil and gas production tax dedications, utility gross receipts tax,
insurance premium tax dedications, coin-operated machine occupation tax dedications, and motor vehicle
sales and use tax dedications; and
(D) for an independent school district, in addition to Subdivisions (A) through
(C), the entity's Foundation School Program entitlement for that final year plus every other form
of state funding the district received in that year, including Available School Fund distributions,
Texas Education Agency appropriations outside the Foundation School Program, categorical grants, and any
other state-source funding.
(7) "Shortfall Percentage" means, for an eligible entity, the percentage calculated
as: (the entity's Final Year Baseline minus the entity's actual Comptroller-certified sales
and use tax distributions at the entity's voter-approved CCR rate) divided by the entity's
Final Year Baseline. The Shortfall Percentage is calculated exclusively from Comptroller-certified
actual revenue figures. No budget, appropriation, projection, or modeled estimate of any kind may be
used in place of actual certified distributions in this calculation.
(8) "Fund" means the TPTRP Transition Fund established under Subchapter B, as
authorized by Article III, Section 49-r, of the Texas Constitution.
(9) "Implementation Date" means January 1, 2029, as established by Article VIII,
Section 9.01(b), of the Texas Constitution — the date on which the prohibition on ad valorem property
taxation becomes operative and the TPTRP sales and use tax system turns on. The Implementation Date is
one year after the effective date of the constitutional amendment proposed by H.J.R. No. ____, 90th
Legislature (January 1, 2028), which effective date establishes the transition-preparation period for
Board constitution, Fund capitalization, portal build-out, and taxing-entity preparation under this
chapter.
(9-A) "Effective Date of the Constitutional Amendment" or "Amendment Effective Date"
means January 1, 2028, as established by Article VIII, Section 9.01(a), of the Texas Constitution.
(10) "SCR" means the Starting Cap Rate — the initial sales and use tax rate
applicable to each tier as established by the TPTRP implementing legislation, which is 3.25 percent
system-wide as established by the TPTRP rate legislation.
(11) "Taxing entity" means any entity authorized to levy taxes under Texas law,
including municipalities, counties, independent school districts, and special purpose districts.
(12) "TRO" means Total Replacement Obligation — each entity's Final Year
Baseline multiplied by 1.10, representing the entity's required annual revenue target inclusive of
a 10 percent structural buffer.
(13) "Board is constituted" means the date on which all three appointed officers
under Section 490.031(b) have taken their oath of office and the Board has held its first meeting with a
quorum present. All deadlines in this chapter measured from the Board's constitution run from that
date.
Sec. 490.002. PURPOSE.
The purpose of this chapter is to:
(1) establish the TPTRP Transition Fund to provide bridge financing and structural
self-sufficiency capital to taxing entities with a revenue shortfall during the transition from ad
valorem property taxation to the sales and use tax system;
(2) establish the TPTRP Transition Board as an independent body of state government
with full administrative and executive authority to manage the transition, resolve entity shortfalls,
and deploy the Fund; and
(3) establish the TPTRP Transition Monitoring Division as a permanent division of the
Comptroller's office to monitor, report, and continue the work of the Board after the Board's
termination.
SUBCHAPTER B. TPTRP TRANSITION FUND
Sec. 490.011. FUND ESTABLISHED.
The TPTRP Transition Fund is a special fund in the State Treasury, outside the
General Revenue Fund, as authorized by Article III, Section 49-r, of the Texas Constitution. The Fund is
established to ensure fiscal continuity for every taxing entity in this State during the transition from
ad valorem taxation to the sales and use tax system. The Fund is administered by the Board during the
Board's active term and by the Division upon the Board's termination.
Sec. 490.012. FUND SOURCES.
(a) The Fund consists of:
(1) surplus collections transferred to the Fund under Subsection (b);
(2) civil penalties collected under the TPTRP Bond Management Act, Government Code
Chapter 490, relating to the Citizens First Bond Portal;
(3) interest, investment earnings, and other returns on Fund balances as provided by
Section 490.019;
(4) legislative appropriations made to the Fund, including appropriations for the
operating budgets of the three appointed Board members and their authorized support staffs, as
established by the enabling statute;
(5) loan repayments and other returns on Fund-authorized assistance; and
(6) any other money transferred or deposited to the credit of the Fund as authorized
by general law consistent with this chapter and with Article III, Section 49-r, of the Texas
Constitution.
(b) Surplus collections are transferred to the Fund as follows:
(1) In the first fiscal year after the Implementation Date, the Comptroller shall
transfer to the Fund, at each quarterly distribution, all amounts collected above each taxing entity's
Final Year Baseline, including amounts attributable to the State of Texas. The entity's Final Year
Baseline flows to the entity through its quarterly distribution; all collections above the Final Year
Baseline flow to the Fund.
(2) In the second fiscal year, the Board shall determine, not later than 90 days
before the end of the first fiscal year and based on Comptroller-certified quarterly distribution data
from the first three quarters of that year, whether to:
(A) activate a transfer of up to 50 percent of each entity's above-baseline
collections to the Fund, effective at each quarterly distribution in the second fiscal year;
(B) waive the transfer in whole or in part; or
(C) activate the transfer on a tier-selective basis, activating for specific tiers
experiencing aggregate instability while waiving for tiers that are stable.
(3) The Board's Year-2 determination shall be made by formal vote, published on
the Texas Sales and Use Tax Portal established under Section 490.073 immediately upon the vote, and
certified to the Comptroller not later than 90 days before the end of the first fiscal year.
(4) From the third fiscal year forward, no collections shall be transferred to the
Fund under this subsection. All above-baseline surplus flows to each entity's waterfall as provided
by the TPTRP implementing legislation.
Sec. 490.013. FUND USES AND RESTRICTIONS.
(a) Money in the Fund may be used only for the following purposes:
(1) Board operations, as appropriated by the Legislature in the enabling statute,
covering:
(A) compensation and direct support costs for the three formally appointed Board
members, who serve as full-time state officers during the Board's active term; and
(B) authorized budgets for personal support staff for each appointed member, as
established by the Legislature in the enabling statute;
(2) supplemental distributions to eligible entities as low-interest loans under
Sections 490.032 and 490.033;
(3) structural self-sufficiency investments in eligible entities as low-interest
loans under Section 490.060, subject to the eligibility gate in Section 490.032A; and
(4) repayment administration, monitoring, and closeout activities directly related to
Subdivisions (1) through (3).
(b) The Comptroller's office and each participating state department are
authorized to apply their respective operating budgets to transition support work to ensure that Board
activities draw primarily on existing state personnel and infrastructure rather than Fund expenditures.
Working members of the Board draw on their respective departmental budgets and do not receive separate
compensation from the Fund.
(c) The Board may submit requests for operating budget increases to the Legislature.
The Legislature may approve or deny such requests at its discretion.
(d) Money in the Fund may not be appropriated, transferred, lent, swept, temporarily
borrowed, or otherwise diverted for any purpose other than a purpose expressly authorized by Subsection
(a). Without limiting the foregoing, no money in the Fund may be:
(1) transferred to the General Revenue Fund;
(2) used for general state cash-flow management or budget execution purposes; or
(3) loaned to any fund or account other than as an authorized disbursement to an
eligible entity under Sections 490.033 or 490.060.
(e) This section controls over any contrary provision of general law, including the
Government Code provisions governing budget execution and treasury cash management.
(f) Loan repayments received by the Fund flow first to the Fund balance and, upon
the Fund's termination, to the Division for management; any remaining Fund balance upon termination
transfers to the state-level surplus waterfall and ultimately to the Economic Stabilization Fund as
provided by Section 490.094.
Sec. 490.014. FUND DURATION.
The Fund terminates not later than the sixth anniversary of the Implementation Date,
concurrent with the termination of the Board under Subchapter G. The Legislature may not extend the Fund's
term. Upon termination, all Fund balances and pending obligations are disposed of as provided by Section
490.094.
Sec. 490.015. FINAL YEAR BASELINE CERTIFICATION.
(a) Not later than the Implementation Date, the Comptroller shall issue a Final Year
Baseline Certification to every taxing entity in this State. The Certification shall establish each
entity's:
(1) Comptroller-certified actual final-year ad valorem property tax collections (M&O
and I&S);
(2) Comptroller-certified actual final-year sales and use tax collections at the rate
in effect immediately before the Implementation Date;
(3) Comptroller-certified actual final-year revenue from every other tax abolished by
Article VIII, Section 1-m(c), of the Texas Constitution that the entity levied or of which the entity
received a dedicated share;
(4) for an independent school district, in addition to Subdivisions (1) through (3),
Comptroller-certified actual final-year Foundation School Program entitlement plus every other form of
state funding the district received in that year; and
(5) resulting Final Year Baseline and TRO.
(b) Certifications shall be based on actual revenues reported by each entity with
supporting documentation — not budgets or projections. Actual revenues govern. This is a citizen
protection.
(c) Certification Dispute Process. An entity may contest its Certification through
the following two-step process:
(1) Step One — Board-Facilitated Arbitration. The entity shall first submit its
contest to the Board. The Board shall facilitate arbitration between the contesting entity and the
Comptroller, with the goal of reaching a mutually agreeable resolution not later than 90 days after the
contest is filed. The Board shall issue a written recommendation at the conclusion of this process.
(2) Step Two — Judicial Review. If the contesting entity and the Comptroller do not
reach a resolution through Step One, the entity may seek direct judicial review of its Certification in
a district court of Travis County. Judicial review under this subdivision is unavailable until the
entity has completed Step One.
(d) The Comptroller shall establish administrative procedures for filing a contest
not later than six months before the Implementation Date. A contest, arbitration, or judicial review
under this section does not stay the Implementation Date or any other provision of this chapter.
(e) The Final Year Baseline Certification is the governing document for all TRO
calculations, Shortfall Percentage calculations, and eligibility determinations under this chapter,
subject to modification upon resolution of a contest under Subsection (c).
(f) The final year's property tax collections for each entity — collected
before the Implementation Date — are expressly authorized for use during the transition period as
follows:
(1) the I&S portion is deposited into the entity's bond service fund and
applied to voter-approved bond debt service obligations;
(2) the M&O portion is deposited into the entity's Stabilization Fund
established under the TPTRP Fund System Act; and
(3) each entity may access either portion to fill documented gaps in M&O funding
or I&S debt service coverage during the transition period.
(g) No Board approval or Fund disbursement is required for an entity to access its
final year's property tax collections under Subsection (f). Any unused balance at fiscal year-end
flows through the entity's waterfall as provided by the TPTRP implementing legislation.
Sec. 490.016. COMPTROLLER NOTIFICATION AND ENTITY MONITORING.
(a) Not later than 30 days after each quarterly distribution, the Comptroller shall
notify the Board of any entity whose actual quarterly distribution fell below its Comptroller-certified
Final Year Baseline.
(b) The notification shall include:
(1) the entity's actual quarterly distribution;
(2) the entity's Final Year Baseline quarterly equivalent;
(3) the shortfall amount;
(4) a forward projection of annualized revenue at the entity's current rate and
at the CCR; and
(5) where applicable, the entity's preliminary Shortfall Percentage calculated
under Section 490.032A(b).
(c) The Board shall review each notification and determine the appropriate response.
A shortfall notification does not create an entitlement to Fund assistance.
(d) No Fund disbursement may be made to an entity that has not met the eligibility
conditions under Section 490.032.
Sec. 490.017. PUBLIC-PURPOSE FINDINGS.
(a) Before approving any supplemental distribution under Section 490.033 or any
structural self-sufficiency investment under Section 490.060, the Board shall make a written finding
that the assistance:
(1) serves a public purpose;
(2) provides a clear public benefit consisting of continuity of essential
governmental services, revenue self-sufficiency, or both; and
(3) is subject to repayment terms, reporting requirements, and other controls
reasonably calculated to ensure the public purpose is accomplished.
(b) A finding under this section shall be recorded in the Board's minutes and
published on the Texas Sales and Use Tax Portal established under Section 490.073 not later than 10 days
after the Board's vote.
(c) This section implements Article III, Section 49-r(e), of the Texas
Constitution.
Sec. 490.018. BOND SERVICE COORDINATION.
(a) The Board and the Division shall monitor each eligible entity's compliance
with the Interest and Sinking Reserve Fund and Bond Reserve Fund requirements established by the TPTRP
Bond Management Act, Government Code Chapter 490 (Article VIII, Section 1-o, Texas Constitution).
(b) Where an eligible entity's bond debt service is at risk due to a
transition-related revenue shortfall, the Board may coordinate bridge assistance under Section 490.033
to support the entity's timely bond debt service, in coordination with the Texas Bond Review Board
and consistent with the backstop cascade established by the Bond Management Act.
(c) Nothing in this chapter replaces, narrows, diminishes, or substitutes for the
state guarantee, backstop cascade, or any other bond protection established by the Bond Management Act.
This section is coordinative only and does not create an independent bond guarantee under this chapter.
(d) This section implements Article III, Section 49-r(f), of the Texas
Constitution.
Sec. 490.019. COMPTROLLER INVESTMENT OF FUND BALANCES.
The Comptroller may invest money in the Fund under the Comptroller's general
investment authority for state treasury funds under Chapter 404. Investment earnings on Fund balances
are credited to the Fund as provided by Section 490.012(a)(3). Investments shall be made in a manner
consistent with the Fund's need for liquidity to meet its authorized disbursement obligations.
Sec. 490.020. AUDIT AUTHORITY.
The Board, the Fund, and the Division are subject to audit by the State Auditor's
Office under Chapter 321. The Board shall provide the State Auditor's Office with access to all
records necessary to conduct an audit under this section.
SUBCHAPTER C. TPTRP TRANSITION BOARD
Sec. 490.031. BOARD ESTABLISHED.
(a) The TPTRP Transition Board is established as an independent body of state
government, as authorized by Article VIII, Section 1-u, of the Texas Constitution.
(b) The Board consists of:
(1) a Chair, appointed by the Governor;
(2) a Vice Chair, appointed by the Speaker of the House of Representatives; and
(3) a Secretary, appointed by the Comptroller of Public Accounts.
(c) Each appointed member serves as a full-time state officer for the full six-year
term of the Board. Appointed members may not hold other state offices or engage in outside employment
that conflicts with their Board duties during the term.
(d) Each appointed member is authorized a budget for personal support staff, as
established by the Legislature in the enabling statute. These budgets shall be modest and appropriate to
the office.
(e) Department working members shall be assigned by each participating state
department from within their existing personnel. Department working members:
(1) participate fully in Board deliberations;
(2) do not vote on Board matters;
(3) do not count toward a quorum; and
(4) hold full authority within their respective departments to act on
Board-coordinated plans.
(f) A quorum for Board action consists of two of the three appointed officers. All
formal Board votes require a quorum.
(g) Each appointed member serves for the full six-year term of the Board unless
removed. The Legislature may initiate removal upon a finding of cause, including failure of duty,
malfeasance, incapacity, or comparable grounds. The Board does not rotate membership during the
transition period.
(h) The Board does not maintain an independent permanent staff. Administrative and
analytical support is provided by the Division and by assigned department working members.
Sec. 490.032. ELIGIBILITY FOR FUND ASSISTANCE.
(a) A taxing entity is eligible for Fund assistance only if all of the following
conditions are met:
(1) the entity's governing body has put a rate increase to its citizens in a
voter election;
(2) the voters within the entity's jurisdiction approved a rate increase of up
to and including the CCR applicable to that entity's tier;
(3) the entity is in compliance with the following requirements as of the most recent
certification:
(A) the Total Budget Cap and Cumulative Budget Growth Cap established under
Article VIII, Section 1-n, of the Texas Constitution and the TPTRP Sales and Use Tax Act;
(B) the mandatory disclosure and real-time data feed requirements of Article VIII,
Section 1-n(l), of the Texas Constitution and the TPTRP implementing legislation; and
(C) the Stabilization Fund, Infrastructure Fund, First Responder Fund, and Citizen
Dividend Fund establishment and maintenance requirements of Article VIII, Section 1-s, of the Texas
Constitution and the TPTRP Fund System Act; and
(4) even at the voter-approved CCR, the entity's quarterly sales and use tax
distributions remain below the entity's Comptroller-certified Final Year Baseline.
(b) Tier 5 Variant. For a Tier 5 entity, the eligibility standard of Subsection (a)
applies as follows: the "CCR applicable to that entity's tier" under Subsection (a)(2) is the
entity's apportioned share of the Tier 5 aggregate cap as apportioned under the TPTRP Sales and Use
Tax Act. All other elements of the eligibility standard apply without modification.
(c) Restoration. An entity that has become ineligible under Subsection (a) remains
ineligible until its voters approve a rate increase that satisfies Subsection (a)(2) or, for a Tier 5
entity, its apportioned equivalent under Subsection (b). Neither the passage of time nor a subsequent
change in the entity's compliance status with Subsection (a)(3) restores eligibility in the absence
of a successful voter election.
(d) Anti-Waiver. Neither the Board nor the Division may waive, reduce, substitute,
defer, or otherwise modify any requirement of this Section. A purported waiver, reduction, or
substitution is void.
(e) Economic Development Carve-Out. Notwithstanding Subsection (a)(2), an entity
that satisfies Subsections (a)(1) and (a)(3) is eligible for structural self-sufficiency assistance
under Section 490.060 for economic development purposes as authorized by Article VIII, Section
1-u(b)(3), of the Texas Constitution, whether or not the entity has yet exhausted its available rate
authority. This carve-out applies only to structural self-sufficiency assistance under Section 490.060;
supplemental distributions under Section 490.033 remain conditioned on full satisfaction of Subsection
(a).
(f) An entity that has not held a voter election under Subsection (a)(1) is not
eligible.
(g) An entity whose voters denied a rate increase is not eligible. An entity whose
voters denied a rate increase must implement its Mandatory Expenditure Reduction Plan as required by the
TPTRP implementing legislation.
(h) An entity whose actual quarterly distributions equal or exceed its Final Year
Baseline is not eligible.
(i) Eligibility under this section is a threshold determination only. Eligibility
for structural self-sufficiency investment and development assistance under Subchapter E is further
governed by the Shortfall Percentage determination in Section 490.032A.
(j) Eligibility is determined by the Board based on Comptroller-certified data.
Determination of eligibility does not guarantee a specific disbursement amount or timeline.
Sec. 490.032A. SHORTFALL PERCENTAGE; PRELIMINARY AND FINAL DETERMINATION.
(a) This section governs whether an eligible entity's shortfall is resolved
through structural self-sufficiency investment and development assistance under Subchapter E, or through
the entity's Mandatory Expenditure Reduction Plan supplemented by bridge-loan assistance under
Section 490.033.
(b) Preliminary Eligibility. At any quarterly distribution occurring during an
eligible entity's first full fiscal year of collections at its voter-approved CCR, if the entity's
actual quarterly distribution, annualized, projects a Shortfall Percentage of 10 percent or greater, the
entity attains Preliminary Eligibility for development assistance. Upon Preliminary Eligibility:
(1) the Board and the entity shall jointly begin planning and preparing a proposed
development pathway under Subchapter E, including entity archetype classification under Section 490.062
and identification of applicable programs under Section 490.064;
(2) the Board may not disburse development capital under Section 490.060 or 490.061
on the basis of Preliminary Eligibility alone; and
(3) Preliminary Eligibility does not affect the entity's obligations, if any,
under its Mandatory Expenditure Reduction Plan pending Final Determination under Subsection (c).
(c) Final Determination. Not later than 45 days after the Comptroller certifies an
eligible entity's actual sales and use tax distributions for the entity's first full fiscal
year at its voter-approved CCR, the Comptroller shall certify the entity's full-year Shortfall
Percentage. Based on that certified figure:
(1) if the certified full-year Shortfall Percentage is 10 percent or greater, the
entity's Preliminary Eligibility under Subsection (b) converts to Final Eligibility, and the Board
may proceed to execute and fund the development pathway prepared under Subsection (b)(1); or
(2) if the certified full-year Shortfall Percentage is less than 10 percent, any
development pathway prepared under Subsection (b)(1) is set aside, the entity does not qualify for
development assistance under Subchapter E, and the entity must implement its Mandatory Expenditure
Reduction Plan as required by the TPTRP implementing legislation.
(d) An entity subject to Subsection (c)(2) may still apply for and receive Fund
bridge-loan assistance under Section 490.033, including supplemental funding to meet payment obligations
on existing, previously committed infrastructure projects and similar committed obligations, while
implementing its Mandatory Expenditure Reduction Plan. Bridge-loan assistance under this subsection is
not development assistance under Subchapter E and is not subject to the 10 percent threshold in this
section.
(e) The Shortfall Percentage is calculated solely from Comptroller-certified actual
revenue figures under Section 490.001(7). No entity budget, appropriation, or projected figure may be
substituted for actual certified distributions in any calculation under this section.
(f) A Final Determination under Subsection (c) may be revisited by the Board only
upon a subsequent full-fiscal-year Comptroller certification showing a materially changed Shortfall
Percentage, and only prospectively.
Sec. 490.033. SUPPLEMENTAL DISTRIBUTIONS — BRIDGE LOANS.
(a) Upon application and Board approval, the Fund shall provide supplemental
coverage to eligible entities structured as low-interest loans.
(b) The interest rate for supplemental distribution loans shall be set by Board
order in the range of one percent to three percent per annum, consistent with comparable Texas state
financing programs.
(c) The Board shall set repayment terms for each loan in coordination with the
eligible entity, based on the entity's projected path to self-sufficiency at or above its Final
Year Baseline.
(d) Bridge loans under this section do not require additional voter elections beyond
the voter approval that established the entity's eligibility under Section 490.032. Voter elections
are required only for decisions that directly alter the structure or territory of a taxing entity —
including dissolution or absorption of a special district, ISD consolidation, and voluntary annexation.
(e) The Board shall certify approved bridge loan amounts to the Comptroller. The
Comptroller shall issue letters of credit or direct distributions as directed by the Board.
(f) A de minimis entity designated under Section 490.063 receives enhanced priority
in the review and approval of applications under this section, as provided by that section.
(g) An entity described by Section 490.032A(d) is eligible for bridge loans under
this section to meet payment obligations on existing, previously committed infrastructure projects and
similar committed obligations while implementing its Mandatory Expenditure Reduction Plan.
Sec. 490.034. BOARD POWERS AND DUTIES.
(a) The Board has full administrative and executive authority to carry out the
purposes of this chapter, including authority to:
(1) review and approve applications for supplemental distributions from the Fund;
(2) certify approved amounts to the Comptroller;
(3) provide analysis and advisory support to taxing entities and to the Legislature
regarding the rates needed for fiscal sufficiency, provided that:
(A) the Board may not set rates for any taxing entity;
(B) rate changes require action by the entity's governing body and, for any
increase up to the applicable CCR, voter approval within the entity's jurisdiction; no rate may
ever exceed the CCR applicable to that entity's tier; and
(C) the Board's role in rate matters is analytical and advisory only — the
decision lies between each entity's governing body and its citizens, within the constitutional
ceiling of the CCR;
(4) provide operational restructuring assistance and technical support to taxing
entities;
(5) identify entities that may require assistance before shortfall conditions become
acute, including monitoring for Preliminary Eligibility under Section 490.032A(b);
(6) report annually to the Legislature and the Governor, not later than December 1 of
each year;
(7) issue administrative rerouting orders under Section 490.051;
(8) advise and facilitate special district dissolution and absorption proceedings
under Section 490.052;
(9) execute commercial development agreements and deploy Fund capital under Sections
490.060 through 490.062, subject to the eligibility gate in Section 490.032A;
(10) administer the de minimis entity track under Section 490.063;
(11) identify and leverage federal and state development programs under Section
490.064;
(12) submit quarterly interim reports under Section 490.072;
(13) maintain the Texas Sales and Use Tax Portal established under Section 490.073,
through the Division; and
(14) execute multi-department coordination agreements under Section 490.074.
(b) The Board shall give priority to ISD applications over other entity types. For
each assisted ISD, the Board shall develop a multi-year financial plan projecting the district's
path to full self-funding under the Tier 4 mechanism of the TPTRP implementing legislation.
(c) No school district, county, municipality, or special district may be placed in
financial exigency solely as a result of the transition from the ad valorem system to the sales and use
tax system, so long as the entity has timely applied for and is receiving Fund assistance and
cooperating with the Board's restructuring recommendations. For an independent school district,
"financial exigency" has the meaning assigned by the Education Code. For a county, municipality, or
special district, "financial exigency" means a fiscal condition in which the entity's governing
body has formally determined, based on Comptroller-certified data, that the entity cannot meet its
certified budgeted obligations for essential governmental services without immediate structural relief.
Sec. 490.035. LEGISLATIVE OBSERVER SEATS.
(a) Each political party represented in the Texas House of Representatives and each
political party represented in the Texas Senate may designate one member as a non-voting observer to the
Board.
(b) Designations shall be made by each party's own internal procedures. No
committee assignment or leadership role is required. A maximum of four observers may be designated at
any time — one per party per chamber.
(c) Observers:
(1) may attend all open Board meetings;
(2) may speak on any agenda item during deliberations;
(3) do not vote on Board matters; and
(4) are not members of the Board and do not count toward a quorum.
(d) An observer may be removed at any time by the designating party, including for
misconduct.
(e) The Board is a governmental body for purposes of, and is subject to, Chapter 551
(Texas Open Meetings Act) in its entirety, including notice, agenda posting, and minutes requirements,
and not merely with respect to observer seats.
(f) The Board's records, including all records generated or received in
connection with Fund administration, are subject to Chapter 552 (Texas Public Information Act).
Sec. 490.036. STATE OFFICER STATUS; ETHICS AND NEPOTISM COMPLIANCE.
(a) The Chair, Vice Chair, and Secretary are state officers for all purposes of
Chapter 572, including the personal financial disclosure, standards of conduct, and conflict-of-interest
requirements of that chapter. Each shall file a personal financial statement with the Texas Ethics
Commission as required by Chapter 572.
(b) A Board member shall recuse from any Board vote or decision in which the member
has a substantial interest, as that term is defined by Chapter 171, Local Government Code, applied by
analogy, or in which a conflict exists under Chapter 572.
(c) Chapter 573 (nepotism) applies to all Board hiring, contracting, and procurement
decisions. A Board member with a disqualifying relationship under Chapter 573 to a prospective employee,
contractor, or applicant for Fund assistance shall recuse from the applicable decision and the recusal
shall be recorded in the Board's minutes.
(d) Department working members remain subject to the ethics and conduct requirements
applicable to their home departments and are not, by virtue of Board service, subject to additional
disclosure obligations under this section beyond those applicable to their home department positions.
Sec. 490.037. SUNSET ACT STANDARDS; CONSTITUTIONAL SUNSET CONTROLS.
(a) The Board and the Fund shall operate consistent with the across-the-board
standards for state agencies developed by the Sunset Advisory Commission under Chapter 325, including
standards addressing public board member conduct, conflict-of-interest prohibitions, public testimony
opportunities, and complaint-handling procedures, to the extent those standards are not inconsistent
with this chapter.
(b) Notwithstanding Subsection (a), the Board is not subject to scheduled review
under Chapter 325, and the Sunset Advisory Commission's standard 12-year review cycle and
continuation process do not apply to the Board. The Board's six-year term is fixed by Article VIII,
Section 1-u, of the Texas Constitution, and that constitutional sunset controls over any Chapter 325
review, continuation, or abolishment mechanism that might otherwise apply. The Board may not be
continued beyond its constitutional sunset date by any Chapter 325 process.
SUBCHAPTER D. BOARD RESOLUTION POWERS
Sec. 490.051. SPECIAL DISTRICT REROUTING AUTHORITY.
(a) The Board has full direct administrative authority to review and confirm all
special district tier absorption assignments and to issue administrative rerouting orders reassigning
any absorbed special district from one tier to another.
(b) A rerouting order is effective upon Board certification to the Comptroller. No
additional legislative action is required.
(c) Not later than 30 days after receiving a rerouting order, the Comptroller shall
update the tier assignment and TRO calculation for all affected entities, based on Comptroller-certified
actual distributions, and reflect the updated figures in the next quarterly distribution.
(d) The Board shall target completion of all rerouting decisions within the first
180 days of Board operation.
Sec. 490.052. SPECIAL DISTRICT DISSOLUTION AND ABSORPTION — VOTER DISCRETIONARY.
(a) The Board may identify special districts whose structural situation makes
dissolution or absorption into the overlying entity the most appropriate long-term resolution.
(b) The Board may advise and facilitate conversations between affected entities and
their voters. No dissolution or absorption may be executed without voter approval from the impacted
entities as required by applicable Texas law.
(c) The Board shall reserve Fund bridge capital for affected entities while the
voter-approval process proceeds.
(d) Upon voter-approved dissolution:
(1) all outstanding voter-approved bond obligations of the dissolved district are
assumed by the overlying entity by operation of law;
(2) the Comptroller shall add the dissolved district's certified annual bond
debt service to the host entity's I&S Rate calculation;
(3) all assets and liabilities of the dissolved district transfer to the host entity
by operation of law; and
(4) bondholders are fully protected — dissolution does not impair or modify any bond
obligation.
Sec. 490.053. ISD CONSOLIDATION.
(a) The Board shall initiate conversations with the Texas Education Agency regarding
ISD consolidation under Education Code Section 13.054 for any independent school district whose
Comptroller-certified actual sales and use tax distributions at the CCR are zero or negligible relative
to its Final Year Baseline, not later than 60 days after the first quarterly distribution report under
Section 490.016.
(b) Consolidation requires voter approval as provided by applicable Texas law. The
Board shall reserve Fund bridge capital for affected ISDs pending voter action.
(c) For each ISD in consolidation proceedings, the Board shall develop a multi-year
financial plan with the Texas Education Agency projecting the consolidating district's path to
financial self-sufficiency.
Sec. 490.054. VOLUNTARY ANNEXATION FACILITATION.
(a) For eligible entities with a Total Replacement Obligation below \$250,000 and
Comptroller-certified actual sales and use tax distributions at the CCR that are zero or negligible
relative to the entity's Final Year Baseline, the Board shall, in addition to other resolution
pathways, offer facilitation of voluntary annexation by an adjacent municipality or absorption into the
overlying county, subject to voter approval as required by applicable Texas law.
(b) The Board shall maintain Fund bridge capital for entities during annexation or
absorption proceedings.
SUBCHAPTER E. STRUCTURAL INVESTMENT AND DEVELOPMENT
Sec. 490.060. STRUCTURAL SELF-SUFFICIENCY INVESTMENTS.
(a) The Board is authorized to deploy Fund capital to help eligible entities build
the permanent revenue base needed to be self-sustaining at or above the entity's Final Year
Baseline, subject to the Final Eligibility determination in Section 490.032A(c)(1).
(b) All deployments under this subchapter are structured as repayable loans at an
interest rate set by Board order in the range of one percent to three percent per annum, consistent with
comparable Texas state financing programs. The Board shall set repayment terms in coordination with the
eligible entity and any participating development partners.
(c) The Board may deploy Fund capital for structural investments in eligible
entities without requiring additional voter elections. Voter elections are required only for decisions
that alter an entity's structure or territory — including dissolution, consolidation, and
annexation.
Sec. 490.061. DEVELOPMENT PROGRAM EXECUTION.
(a) Development agreements, project agreements, and loan instruments funded under
this subchapter are executed by and through the eligible local taxing entity, using the authority and
procedures of:
(1) Local Government Code Chapter 380 (municipal economic development agreements);
(2) Local Government Code Chapter 381 (county economic development agreements);
(3) Government Code Chapter 489 (Texas Economic Development Bank); and
(4) Government Code Chapter 2303 (Texas Enterprise Zone Act).
(b) The Board's role is to coordinate, accelerate, and co-finance development
agreements executed by eligible entities under Subsection (a), including by providing Fund capital,
identifying applicable federal and state programs, and coordinating with other state departments under
Section 490.074, rather than to directly contract as a state procurement authority under Chapters 2254,
2261, or 2262. The Board's principal value to an eligible entity is expediting and reducing the
cost of development financing already available under existing local government economic development
authority, not creating a new state contracting regime.
(c) Notwithstanding Subsection (b), the Board may directly execute a loan agreement
with an eligible entity for the disbursement of Fund capital under this subchapter. Such a loan
agreement is not a public works contract and is not subject to Chapters 2254, 2261, or 2262.
(d) Loan repayments under this section are credited to the Fund balance. Upon Fund
termination, all remaining loan repayment obligations transfer to the Division.
Sec. 490.062. ENTITY ARCHETYPE PRIORITIZATION.
The Board shall classify each eligible shortfall entity into a resolution archetype
before selecting a resolution pathway. The Board shall select the pathway that produces the fastest path
to Final Year Baseline revenue sufficiency at the lowest cost to the Fund with the best long-term
economic outcomes for the entity's residents. Resolution pathways include administrative rerouting
under Section 490.051, ISD consolidation under Section 490.053, annexation or absorption under Section
490.054, commercial development programs under Section 490.061, and bridge loans under Section 490.033.
Sec. 490.063. DE MINIMIS ENTITY TRACK — EXPEDITED VOTER-APPROVED RESOLUTION.
(a) The Board shall establish by order a de minimis TRO threshold, not to exceed
\$25,000, for entities whose Comptroller-certified actual sales and use tax distributions at the CCR are
zero or negligible relative to the entity's Final Year Baseline.
(b) An entity meeting the de minimis threshold under Subsection (a) is not
administratively dissolved or consolidated. Instead, the entity is placed on the de minimis track, under
which the Board shall:
(1) grant the entity's applications for bridge loans under Section 490.033
enhanced priority in review and approval over non-de minimis applications;
(2) proactively prepare and present to the entity's governing body, not later
than 60 days after the entity's designation, a proposed dissolution, consolidation, or annexation
plan for submission to the entity's voters, including a transition budget and successor-entity
assumption plan for the governing body's consideration; and
(3) if the entity's governing body elects to call an election on the proposed
plan, provide expedited administrative, legal drafting, and election-coordination support to the entity
to bring the matter to the entity's voters at the earliest available uniform election date.
(c) No entity may be dissolved, consolidated, or annexed under this section without
the voter approval otherwise required by this chapter and by other applicable Texas law. A
Comptroller-certified figure of zero or negligible actual distributions, standing alone, does not itself
effect a dissolution, consolidation, or annexation, and is not conclusive evidence that a dissolution,
consolidation, or annexation election will succeed.
(d) If the entity's voters decline the proposed plan, the entity remains on the
de minimis track and continues to receive enhanced bridge-loan priority under Subsection (b)(1) until
the entity's certified actual distributions rise above the de minimis threshold or the entity's
governing body proposes a different resolution.
(e) The Board shall publish the established threshold not later than 30 days after
the Board is constituted.
Sec. 490.064. FEDERAL AND STATE DEVELOPMENT PROGRAM LEVERAGE.
(a) The Board is authorized and directed to identify and leverage all available
federal and state economic development programs, special zone designations, and financing tools in
eligible shortfall entity jurisdictions to accelerate commercial development and build permanent sales
and use tax revenue.
(b) The Board shall select programs based on the standard of fastest path to Final
Year Baseline revenue sufficiency at the lowest cost to the Fund with the best long-term economic
outcomes for entity residents.
(c) The Board is not limited to any enumerated list of programs. The Board shall
leverage any applicable program available at the time of implementation, including as illustrative
examples:
(1) federal opportunity zone and investment incentive programs;
(2) federal and state tax credit programs targeting low-income, food-desert, and
blighted community development;
(3) USDA and SBA rural development loan, grant, and guarantee programs;
(4) Texas state enterprise zone and economic development programs;
(5) federal contracting set-aside programs generating small business formation and
commercial activity;
(6) community development block grant and similar federal programs; and
(7) any other federal, state, or local program that accelerates commercial
construction, business formation, or economic activity in eligible shortfall entity jurisdictions.
(d) Only entities meeting the eligibility conditions under Section 490.032 and, for
development assistance specifically, the Final Eligibility determination under Section 490.032A(c)(1),
qualify for Board-assisted program leveraging.
(e) The Board shall maintain a Special Zone Leverage Register on the Texas Sales and
Use Tax Portal established under Section 490.073 identifying applicable programs in each shortfall
entity's jurisdiction and the status of coordination efforts.
(f) Federal and state program coordination is informal and at Board discretion.
Formal memoranda of understanding are authorized but not required. The Board shall pursue the most
direct and expeditious coordination channels available.
SUBCHAPTER F. TRANSPARENCY AND REPORTING
Sec. 490.071. ANNUAL REPORT.
Not later than December 1 of each year, the Board shall submit an annual report to
the Governor, the Lieutenant Governor, and the Speaker of the House of Representatives. The report shall
describe the status of each eligible entity on the Board's worklist, including preliminary and
final Shortfall Percentage determinations under Section 490.032A, Fund balance and deployment summary,
and a forecast of remaining transition obligations.
Sec. 490.072. QUARTERLY INTERIM REPORTS.
Not later than the 45th day after the end of each calendar quarter, the Board shall
submit a quarterly interim report to the House Appropriations Committee and the Senate Finance
Committee.
Sec. 490.073. TEXAS SALES AND USE TAX PORTAL.
The Texas Sales and Use Tax Portal is the single consolidated public-facing platform
for the TPTRP. It is established under this Section, operated by the Board during the Board's
active term and by the Division upon the Board's termination. The Portal serves as the anchor
platform, with the Citizens First Bond module (established under the TPTRP Bond Management Act), the
Foreign Entity module (established under the TPTRP Remote Seller and Foreign Entity Act), the Cascade
Status module (established under the TPTRP Fund System Act), the Local Government Transparency module,
the Section 1-n(l) Disclosure Feed module, and the Section 1-v Performance Publication module
(established under Section 490.105) operating as named modules of the Portal.
(a) The Board shall establish and maintain, through the Division, a public-facing
website and digital dashboard integrated with the Comptroller's financial systems.
(b) The Texas Sales and Use Tax Portal shall display, updated not less than
monthly:
(1) each entity's status, resolution pathway, and current resolution phase,
including de minimis track status under Section 490.063 and Preliminary or Final Eligibility status
under Section 490.032A;
(2) all Fund disbursements and loan repayments by entity;
(3) all Board votes, by member, on the public record, including public-purpose
findings under Section 490.017;
(4) Fund balance and monthly deployment schedule;
(5) all active commercial development loan agreements;
(6) the Special Zone Leverage Register required under Section 490.064; and
(7) a full public financial ledger of all Fund transactions in standard financial
reporting format.
(c) The Texas Sales and Use Tax Portal shall publish formal public announcements of
significant Board actions, Fund deployments exceeding the threshold under Section 490.074(b), and entity
status changes.
(d) All Board votes are public records subject to Chapter 552.
(e) The Texas Sales and Use Tax Portal is operational from the first day of the
Board's operation and remains publicly accessible beyond the Board's sunset through the
Division.
Sec. 490.074. LEGISLATIVE NOTIFICATION THRESHOLD AND MULTI-DEPARTMENT COORDINATION.
(a) Not later than 90 days after the Board is constituted, the Board shall enter
into written coordination agreements with:
(1) the Texas Comptroller of Public Accounts;
(2) the Texas Education Agency;
(3) the Texas Economic Development and Tourism Office;
(4) the Texas Bond Review Board;
(5) the Texas Water Development Board;
(6) the Texas Commission on Environmental Quality; and
(7) the Texas Department of Housing and Community Affairs.
Each agreement shall specify the department's data-sharing obligations,
working-member assignments, coordination role, and responsibilities upon the Board's sunset.
(b) The Board shall notify the Governor, the Lieutenant Governor, and the Speaker of
the House of Representatives at least 30 days before executing any single Fund deployment exceeding
\$500 million. The Legislature, by concurrent resolution, may require the Board to delay any such
deployment for not more than 60 additional days for legislative review.
(c) The Board may establish informal coordination arrangements with any federal
agency or state entity whose programs are applicable to eligible shortfall entities, at Board discretion
and without a formal memorandum of understanding requirement.
SUBCHAPTER G. BOARD SUNSET AND DISSOLUTION
Sec. 490.091. BOARD SUNSET.
(a) The Board is dissolved by operation of law on the sixth anniversary of the
Implementation Date, unless dissolved earlier under Section 490.092. This sunset is fixed by Article
VIII, Section 1-u, of the Texas Constitution and is not subject to extension, continuation, or
modification under Chapter 325 or any other general law.
(b) The Board's six-year term may not be extended.
(c) The Legislature may, by law and upon a specific legislative finding, extend any
individual assistance obligation or development agreement beyond the Board's sunset date, to be
administered by the Division. Such an extension applies only to the specified obligation or agreement —
it does not extend the Board's existence or authority.
Sec. 490.092. EARLY DISSOLUTION.
(a) The Board may dissolve before the sixth anniversary of the Implementation Date
by unanimous vote of all three appointed members, provided the Comptroller has certified that:
(1) all entities on the Board's worklist are self-sufficient at or above their
Final Year Baseline; and
(2) all development projects are under active management with a designated
successor.
(b) Upon early dissolution, all Fund balances transfer to the state-level waterfall,
and all pending obligations and records transfer to the Division, as provided by Section 490.094.
Sec. 490.093. PRE-DISSOLUTION CERTIFICATION.
Not later than 90 days before the scheduled dissolution date, the Board shall:
(1) certify the status of all entities on its worklist to the Legislature and the
Governor;
(2) transfer all active agreements, pending obligations, and records to the Division;
and
(3) cause all records required by the State Records Retention Schedule to be
transferred to the Texas State Library and Archives Commission.
Sec. 490.094. DISPOSITION OF FUND BALANCE ON DISSOLUTION.
On the date of the Board's dissolution, all remaining Fund balances transfer by
operation of law through the state-level surplus waterfall and ultimately to the Economic Stabilization
Fund. All remaining loan repayment obligations transfer to the Division.
SUBCHAPTER H. TPTRP TRANSITION MONITORING DIVISION
Sec. 490.101. DIVISION ESTABLISHED.
(a) The TPTRP Transition Monitoring Division is established within the Comptroller's
office, effective on the effective date of this chapter, as authorized by Article VIII, Section 1-u(h),
of the Texas Constitution.
(b) The Division Director is appointed by the Comptroller of Public Accounts. No
Senate confirmation is required.
(c) The Division is a permanent organizational unit of the Comptroller's
office. The Division does not sunset.
(d) The Comptroller has full authority over the Division's internal structure,
staffing, and operational procedures, subject to the reporting, monitoring, and liaison obligations
established by this chapter.
Sec. 490.102. DIVISION DUTIES DURING BOARD'S ACTIVE TERM.
During the Board's active term, the Division shall:
(1) provide administrative and analytical support to the Board;
(2) operate the Texas Sales and Use Tax Portal established under Section 490.073;
(3) notify the Board not later than 30 days after any quarterly distribution in which
any entity falls below its Final Year Baseline;
(4) certify TRO and Shortfall Percentage figures at Board direction; and
(5) issue Final Year Baseline Certifications to all entities before the
Implementation Date under Section 490.015.
Sec. 490.103. DIVISION DUTIES UPON BOARD DISSOLUTION.
Upon the Board's dissolution, the Division shall:
(1) assume all pending obligations, active loan agreements, and development contracts
transferred by the Board;
(2) continue quarterly reporting to the Legislature and the Governor for not less
than two years after the dissolution date;
(3) monitor all taxing entity quarterly sales and use tax collections on an ongoing
basis;
(4) maintain the Texas Sales and Use Tax Portal established under Section 490.073
indefinitely;
(5) coordinate with the Texas Education Agency on ISD Tier 4 funding status on an
ongoing basis;
(6) close out active development projects and transfer completed projects to the
relevant entities; and
(7) assist any taxing entity experiencing post-transition revenue shortfalls, using
the State's Rainy Day Fund as a last resort after all other avenues have been exhausted.
Sec. 490.104. DEPARTMENTAL LIAISONS.
Each state department that served as a working member of the Board shall maintain at
minimum one designated liaison to the Division for the duration of the Division's active
operations. The Comptroller may adjust individual assignments but may not reduce the liaison
requirement.
Sec. 490.105. SECTION 1-V PERFORMANCE PUBLICATION.
(a) The Division shall, not later than April 30 of each year beginning with the
first full calendar year after the Implementation Date, publish an annual performance report measuring
the TPTRP against the seven performance criteria established by Article VIII, Section 1-v, of the Texas
Constitution.
(b) The annual performance report shall be published as the Section 1-v Performance
Publication module of the Texas Sales and Use Tax Portal established under Section 490.073.
(c) The Division shall establish, by rule, the specific data elements, measurement
methodologies, and disclosure formats for each of the seven performance criteria, subject to the
constitutional standards of Article VIII, Section 1-v.
(d) This section implements Article VIII, Section 1-v(c), of the Texas
Constitution.
ARTICLE 2. CONFORMING AMENDMENT — BOND MANAGEMENT BILL
SECTION 2.02.
The TPTRP Bond Management Act (H.B. ___, 90th Legislature) is amended by adding
Article 1 to read as follows:
ARTICLE 1. CROSS-REFERENCE TO TPTRP TRANSITION BOARD ACT. This Act is to be read in
conjunction with the TPTRP Transition Board, Transition Fund, and Transition Plan Act (H.B. ___, 90th
Legislature), which establishes the TPTRP Transition Board and the TPTRP Transition Fund. The Transition
Board has authority under that Act, including Section 490.018 of that Act, to coordinate support for
eligible entities' bond service obligations and M&O shortfalls as provided therein. That
coordination does not replace, narrow, or substitute for the state guarantee and backstop cascade
established by this Act. In the event of conflict between this Act and that Act on matters of Transition
Board authority, the TPTRP Transition Board, Transition Fund, and Transition Plan Act governs.
ARTICLE 3. APPROPRIATION
SECTION 3.01.
There is appropriated from the TPTRP Transition Fund to the TPTRP Transition Board,
for the fiscal biennium beginning September 1, 2028, the sum of $5,000,000 (subject to final
appropriation by the Legislature at the time of enactment) for the purposes of Sections 490.013(a)(1)
and 490.013(a)(2) of the Government Code as added by this Act. This appropriation is subject to the
condition that the constitutional amendment proposed by H.J.R. No. ____, 90th Legislature, is approved
by the voters and takes effect.
SECTION 3.02.
Continued funding of Board operations for the second and third biennia of the Board's
six-year term is subject to appropriation by the Legislature in each subsequent General Appropriations
Act. The Fund itself remains available as provided by Section 490.013 regardless of the timing of
biennial appropriations acts.
ARTICLE 4. SAVING AND TRANSITION PROVISIONS
SECTION 4.01.
Any action taken or obligation incurred under Government Code Chapter 490 as enacted
by the TPTRP Bond Management Act (H.B. ___, 90th Legislature) before the effective date of this Act
remains valid and is continued in effect under the provisions of this Act.
SECTION 4.02.
The TPTRP Transition Board established by this Act shall constitute itself and
execute all required coordination agreements not later than 90 days after the Amendment Effective Date.
ARTICLE 5. EFFECTIVE DATE
SECTION 5.01.
This Act takes effect September 1, 2028, but only if the constitutional amendment
proposed by H.J.R. No. ____, 90th Legislature, Regular Session, 2028, is approved by the voters at an
election held for that purpose. If that constitutional amendment is not approved by the voters, this Act
has no effect.
Change Log — Stage 1 Conformity Edits (2026-08-02)
| # | Section | Edit description |
|---|---|---|
| 1.1 | Sec. 490.001(2) | Replaced broken "six percent for Tiers 2 through 5" CCR definition with the correct per-tier CCR schedule (T1 2.00%, T2 1.00%, T3 1.00%, T4 1.50%, T5 0.50% aggregate) and clarified that 6.00% is the combined ceiling at any single location, not a per-tier rate, per Article VIII, Section 1-n(b). |
| 1.2 | Sec. 490.001(9)-(9-A) | Split the conflated "Implementation Date" definition into "Implementation Date" (January 1, 2029, ad-valorem-off/tax-on date, Sec. 9.01(b)) and new "Effective Date of the Constitutional Amendment"/"Amendment Effective Date" (January 1, 2028, Sec. 9.01(a)). |
| 1.2 | SECTION 4.02 | Changed the Board's self-constitution deadline from "90 days after the Implementation Date" to "90 days after the Amendment Effective Date," since Board constitution occurs during the transition-preparation year, not after ad-valorem-off. |
| 1.3 | Sec. 490.001(6) | Expanded "Final Year Baseline" definition to enumerate all four required revenue categories: property tax (M&O/I&S), sales and use tax, every other Sec. 1-m(c)-abolished tax the entity levied or shared in, and (for ISDs) FSP entitlement plus all other state funding. |
| 1.3 | Sec. 490.015(a) | Rewrote the three-item certification list as a five-item list matching the four Final Year Baseline categories plus the resulting Final Year Baseline/TRO figure. |
| 1.4 | Sec. 490.032 | Restructured the Assistance Eligibility Standard from three to seven elements: added new (a)(3) compliance prong (Budget Caps, Sec. 1-n(l) disclosure, Sec. 1-s fund requirements), renumbered the prior shortfall prong to (a)(4), and added new (b) Tier 5 Variant, (c) Restoration, (d) Anti-Waiver, and (e) Economic Development Carve-Out subsections. Prior (b)-(f) (election/rejection/threshold/determination provisions) were preserved in substance and relettered (f)-(j) to accommodate the new subsections. |
| 1.5 | Sec. 490.001(1), (8); Sec. 490.011; Sec. 490.012(a)(6); Sec. 490.017(c); Sec. 490.018(d); Sec. 490.031(a); Sec. 490.037(b); Sec. 490.091(a); Sec. 490.101(a) | Filled every "Article VIII, Section 1-___" blank with "Article VIII, Section 1-u" and every "Article III, Section 49-___" blank (including the (e) and (f) subsection variants) with "Article III, Section 49-r." |
| 1.6 | Sec. 490.001(4) | Corrected the Division's home subchapter reference from "Subchapter F" (Transparency and Reporting) to "Subchapter H" (TPTRP Transition Monitoring Division), confirmed against the file's actual SUBCHAPTER banners. |
| 1.7 | Sec. 490.015(f)(2) | Replaced "the entity's Rainy Day Fund" with "the entity's Stabilization Fund established under the TPTRP Fund System Act." Verified the remaining "Rainy Day Fund" reference (Sec. 490.103(7)) refers to the state-level fund in context and required no change; verified Sec. 490.094 already correctly reads "Economic Stabilization Fund." |
| 1.8 | Sec. 490.012(a)(2); Sec. 490.018(a) | Filled the Bond Management Act cross-references as Government Code Chapter 490 in this coordinated pass. |
| 1.9 | Sec. 490.073 | Renamed "PUBLIC TRANSPARENCY PLATFORM" to "TEXAS SALES AND USE TAX PORTAL," added the required introductory paragraph identifying the Portal as the single consolidated platform with its named modules (including the new Section 1-v Performance Publication module at Sec. 490.105), and updated internal subsection references from "the platform" to "the Texas Sales and Use Tax Portal." |
| 1.9 | Sec. 490.012(b)(3); Sec. 490.017(b); Sec. 490.034(a)(13); Sec. 490.064(e); Sec. 490.102(2); Sec. 490.103(4) | Updated every remaining "public transparency platform" cross-reference to read "Texas Sales and Use Tax Portal established under Section 490.073." |
| 1.10 | Sec. 490.105 (new) | Added the Section 1-v performance publication section in Subchapter H. Because Sec. 490.102 was already in use ("Division Duties During Board's Active Term"), the next available number in Subchapter H — Sec. 490.105 — was used instead of the spec's placeholder "Sec. 490.10X." Cross-referenced from the new Sec. 490.073 introductory paragraph. |
| 1.11 | Sec. 490.018(a); Sec. 490.094; Sec. 490.103(7) | Verified no entity-level reserve fund is referred to by any name other than "Stabilization Fund" requiring correction: the "Interest and Sinking Reserve Fund and Bond Reserve Fund" in Sec. 490.018(a) are distinct Bond Management Act reserve mechanisms outside the scope of this edit; Sec. 490.094 already correctly reads "Economic Stabilization Fund" (state fund); the "State's Rainy Day Fund" in Sec. 490.103(7) is a permissible colloquial reference to the state-level fund. No textual change required beyond the Sec. 490.015(f)(2) correction logged under Edit 1.7. |
[EDIT NOTE:] Sec. 490.032's pre-existing subsections (b) through (f) were
relettered to (f) through (j) to accommodate the four new subsections required by Edit 1.4. No
cross-references elsewhere in the file pointed to the relettered subsections by letter, so no
further conformity changes were required; this should be verified again in the Stage 2 conformity
sweep once HB A's Sec. 1-n(m) dispute-process cross-references are finalized.
TRANSITION BOARD ACT — STAGE 3 EDIT LOG (2026-08-06)
| # | Section | Edit description |
|---|---|---|
| tba.s3.1 | Portal rename (13 occurrences) | Renamed "Texas Sales and Use Tax Portal" to "Texas Sales and Use Tax Portal" throughout. Section 490.073, Government Code, remains the codification anchor for the portal; only the portal's public name changes. |
Change Log — Version 3 (2026-08-07)
| # | Section | Edit description |
|---|---|---|
| v3.1 | Whole Act | Conformed temporary constitutional citations and standardized the Portal name. |
| v3.2 | Secs. 490.012, 490.018; Articles 2–5 | Filled codification, article, year, and appropriation placeholders; the appropriation is $5,000,000 subject to final legislative appropriation. |
| v3.3 | Article 2 | Deleted the erroneous Chapter 490 self-repealer and retained a coordination cross-reference to this Act. |