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October 17, 2000     (512) 463-0300

SUBCOMMITTEES REPORT TO SENATE COMMITTEE ON ECONOMIC DEVELOPMENT

Austin - In what could be a preview of legislation to be considered by the 77th Legislature in January 2001, the Senate Committee on Economic Development adopted reports from its subcommittees on issues being studied during this interim.

The Subcommittee on Consumer Credit Laws studied how banking, securities and insurance seem to be merging into one industry as companies that previously only sold one of these products diversify into the other areas. Recommendations include bringing Texas statutes into compliance with changed federal laws, restricting the time the Insurance Department can review such agreements between such companies and requiring additional disclosure of the fees consumers are charged when they use automatic teller machines. Other recommendations call for the passage of legislation giving consumers more control over the use of their non-public personal financial information by insurance companies.

A separate subcommittee is studying business financing. Lt. Governor Rick Perry had asked for a study of ways to fund new job creation, promote entrepreneurship and economic development in Texas. The Subcommittee on Private Sector Business Financing discovered that early-stage financing is not only crucial, but difficult for new businesses to get. It found that while state sponsored financing has been successful in some places, it has been a failure in others. Various solutions to the financing question include dedicating state revenue from oil and gas or lottery reserves, or more recently, tobacco settlement proceeds. Another recommendation is that Texas better utilize the resources of its universities to promote growth in the private sector, saying that commercialization of university research will attract capital and provide new opportunities for economic development.

Other charges from the Lt. Governor include the monitoring of Senate Bill 560, regarding the regulation of telecommunications utilities by the Public Utility Commission and the provision of telecommunications services. The committee is also studying any needed changes to create a modern, cost-effective 9-1-1 system.

The Texas Senate Committee on Economic Development is chaired by Senator David Sibley of Waco. Senator Ken Armbrister of Victoria serves as vice-chair. Members include John Carona of Dallas, Troy Fraser of Horseshoe Bay, Mike Jackson of La Porte, Frank L. Madla of San Antonio and John Whitmire of Houston.

The committee recessed subject to call of the chair.

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