HB563 - Relating to the establishment of the small municipality revenue recovery grant program to provide financial assistance for economic development to small municipalities facing severe economic hardships.

  89R3729 JBD-F     By: Gervin-Hawkins H.B. No. 563       A BILL TO BE ENTITLED   AN ACT   relating to the establishment of the small municipality revenue   recovery grant program to provide financial assistance for economic   development to small municipalities facing severe economic   hardships.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subtitle A, Title 4, Local Government Code, is   amended by adding Chapter 110 to read as follows:   CHAPTER 110.   MISCELLANEOUS FINANCIAL PROVISIONS AFFECTING   MUNICIPALITIES           Sec.   110.001.     SMALL MUNICIPALITY REVENUE RECOVERY GRANT   PROGRAM. (a)   In this section:                 (1)     "Grant" means a grant authorized to be awarded by   the comptroller under the small municipality revenue recovery grant   program established under this section.                 (2)     "Qualified municipality" means a municipality   with a population of 10,000 or less that experienced a decrease in   total revenue of at least 15 percent during the preceding municipal   fiscal year as the result of a reduction or termination of contracts   with private sector entities.           (b)     The comptroller shall establish and administer the   small municipal revenue recovery grant program to support the state   purpose of ensuring the vitality of small municipalities throughout   the state by providing financial assistance for economic   development to qualified municipalities.           (c)     To receive a grant, a municipality must submit an   application to the comptroller in the manner prescribed by   comptroller rule.           (d)     The comptroller may award a grant to a qualified   municipality that applies for the grant using money appropriated to   the comptroller for that purpose or other available money,   including federal funds, that may be used for purposes of this   section.   A grant must be in an amount of:                 (1)     not more than $7 million for economic development   programs; and                 (2)     not less than $100,000 or more than $7 million to   fund an economic development project described by Subsection   (e)(2).           (e)     A municipality that is awarded a grant may not use grant   money for a purpose other than:                 (1)  economic development programs; or                 (2)     to fund one or more specific projects to create or   promote the creation of jobs in the municipality, which may include   the purchase of real and personal property and the construction or   improvement of new buildings, facilities, infrastructure, or other   improvements.           (f)     The comptroller shall adopt rules necessary to   implement this section, including rules that establish:                 (1)     a standardized application process, including the   form to be used to apply for a grant, the manner of submitting the   form, and the information required to be submitted with the   application;                 (2)  deadlines for:                       (A)  applying for the grant;                       (B)  disbursement of grant money; and                       (C)  spending grant money; and                 (3)  procedures for:                       (A)     monitoring the disbursement of grant money to   ensure compliance with this section; and                       (B)     the return of grant money that was not used by   a municipality for a purpose authorized by this section.          SECTION 2.  A qualified municipality, as defined by Section   110.001, Local Government Code, as added by this Act, may not apply   for a small municipality revenue recovery grant before January 1,   2026.          SECTION 3.  Not later than January 1, 2026, the comptroller   of public accounts shall comply with the requirements of Section   110.001, Local Government Code, as added by this Act.          SECTION 4.  This Act takes effect September 1, 2025.