1-1 By: Montford, et al. S.B. No. 778
1-2 (In the Senate - Filed March 10, 1993; March 11, 1993, read
1-3 first time and referred to Committee on Finance; May 3, 1993,
1-4 reported adversely, with favorable Committee Substitute by the
1-5 following vote: Yeas 12, Nays 0; May 3, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Montford x
1-9 Turner x
1-10 Armbrister x
1-11 Barrientos x
1-12 Bivins x
1-13 Ellis x
1-14 Haley x
1-15 Moncrief x
1-16 Parker x
1-17 Ratliff x
1-18 Sims x
1-19 Truan x
1-20 Zaffirini x
1-21 COMMITTEE SUBSTITUTE FOR S.B. No. 778 By: Montford
1-22 A BILL TO BE ENTITLED
1-23 AN ACT
1-24 relating to the dedication of certain funds for the use of the
1-25 Texas Commission on the Arts.
1-26 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-27 SECTION 1. The heading for Subchapter B, Chapter 444,
1-28 Government Code, is amended to read as follows:
1-29 SUBCHAPTER B. POWERS AND DUTIES; FUNDING
1-30 SECTION 2. Subsection (c), Section 444.024, Government Code,
1-31 is amended to read as follows:
1-32 (c) The commission by rule shall adopt equitable procedures
1-33 for the distribution of grants to recipients who reflect the
1-34 geographical, cultural, and ethnic diversity of the state's
1-35 population <Grants of money shall be made without regard to the
1-36 race, creed, sex, religion, or national origin of the applicant>.
1-37 SECTION 3. Section 444.025, Government Code, is amended to
1-38 read as follows:
1-39 Sec. 444.025. Donations; Appropriations; Audit. (a) The
1-40 commission may accept on behalf of the state donations of money,
1-41 property, and art objects<, and historical relics> as it determines
1-42 best further the orderly development of the artistic resources of
1-43 the state. Except as provided by Subsection (b), <All> money paid
1-44 to the commission under this chapter shall be deposited in the
1-45 Texas cultural endowment fund <state treasury>.
1-46 (b) The commission may solicit donations from an appropriate
1-47 source. A person may designate a donation as intended for the
1-48 Texas cultural endowment fund or the Texas Commission on the Arts
1-49 operating fund. If the person designates that a donation is
1-50 intended for a specific fund, the donation shall be deposited in
1-51 the designated fund.
1-52 (c) The commission by rule shall establish an acquisition
1-53 policy for accepting property and art objects.
1-54 (d) The legislature may make appropriations to the
1-55 commission to carry out the purposes of this chapter.
1-56 (e) <(c)> The financial transactions of the commission are
1-57 subject to audit by the state auditor in accordance with Chapter
1-58 321, Government Code.
1-59 SECTION 4. Subchapter B, Chapter 444, Government Code, is
1-60 amended by adding Sections 444.026 through 444.028 to read as
1-61 follows:
1-62 Sec. 444.026. TEXAS CULTURAL ENDOWMENT FUND. (a) The Texas
1-63 cultural endowment fund is a trust fund outside the state treasury.
1-64 (b) The legislature may not appropriate money in the
1-65 endowment fund.
1-66 (c) Interest and income earned before September 1, 1994, on
1-67 money deposited in the endowment fund shall be deposited to the
1-68 credit of the endowment fund. Interest and income earned on or
2-1 after September 1, 1994, on money deposited in the endowment fund
2-2 shall be deposited to the credit of the endowment fund and then
2-3 transferred by the commission on September 1 of each year to the
2-4 Texas Commission on the Arts operating fund.
2-5 (d) This section is exempt from the application of Sections
2-6 403.094(h) and 404.071.
2-7 Sec. 444.027. TEXAS COMMISSION ON THE ARTS OPERATING FUND.
2-8 (a) The Texas Commission on the Arts operating fund is a special
2-9 fund in the state treasury.
2-10 (b) Money deposited to the credit of the operating fund may
2-11 be appropriated only to carry out the commission's powers and
2-12 duties under this chapter and for necessary administrative costs
2-13 incurred by the commission under this chapter.
2-14 (c) The operating fund is exempt from the application of
2-15 Sections 403.094(h) and 404.071. Interest received from
2-16 investments of money in the operating fund shall be allocated
2-17 monthly by the state treasurer to the operating fund.
2-18 Sec. 444.028. ENDOWMENT FUND INVESTMENT AND MANAGEMENT.
2-19 (a) The commission shall appoint investment managers for the
2-20 management and investment of the Texas cultural endowment fund by
2-21 contracting for professional investment management services with
2-22 one or more organizations that are in the business of managing
2-23 investments.
2-24 (b) In choosing and contracting for professional investment
2-25 management services and in continuing the use of an investment
2-26 manager, the commission shall act prudently and in the interest of
2-27 the beneficiaries of the endowment fund.
2-28 (c) In making and supervising investments of the endowment
2-29 fund, an investment manager and the commission shall discharge
2-30 their respective duties solely in the interest of the beneficiaries
2-31 of the fund:
2-32 (1) for the exclusive purposes of providing benefits
2-33 for the beneficiaries of the fund and defraying reasonable expenses
2-34 of administering this chapter;
2-35 (2) with the care, skill, prudence, and diligence
2-36 under the prevailing circumstances that a prudent person acting in
2-37 a like capacity and familiar with matters of the type would use in
2-38 the conduct of an enterprise with a like character and like aims;
2-39 (3) by diversifying the investments of the fund to
2-40 minimize the risk of large losses, unless under the circumstances
2-41 it is clearly prudent not to do so; and
2-42 (4) in accordance with the documents and instruments
2-43 governing the fund to the extent that the documents and instruments
2-44 are consistent with this section.
2-45 (d) To be eligible for appointment under this section, an
2-46 investment manager must be:
2-47 (1) registered under the Investment Advisors Act of
2-48 1940 (15 U.S.C. Section 80b-1 et seq.);
2-49 (2) a bank as defined by that Act that has a trust
2-50 department; or
2-51 (3) an insurance company qualified to perform
2-52 investment services under the laws of more than one state.
2-53 (e) In a contract made under this section, the commission
2-54 shall specify any policies, requirements, or restrictions,
2-55 including criteria for determining the quality of investments and
2-56 for the use of standard rating services, that the commission adopts
2-57 for investments of the endowment fund.
2-58 (f) A member of the commission is not liable for the acts or
2-59 omissions of an investment manager appointed under Subsection (a).
2-60 A member of the commission is not permitted or obligated to invest
2-61 or otherwise to manage any asset of the fund subject to management
2-62 by the investment manager.
2-63 (g) An investment manager appointed under Subsection (a)
2-64 shall acknowledge in writing the manager's fiduciary
2-65 responsibilities to the endowment fund.
2-66 (h) The commission may at any time and shall frequently
2-67 monitor the investments made by each investment manager for the
2-68 endowment fund. The commission may contract for professional
2-69 evaluation services to fulfill this requirement.
2-70 (i) The commission shall enter into an investment custody
3-1 account agreement designating a bank or a depository trust company
3-2 to serve as custodian for all assets allocated to or generated
3-3 under a contract for professional investment management services.
3-4 (j) Under a custody account agreement, the commission shall
3-5 require the designated custodian to perform the duties and assume
3-6 the responsibilities for the endowment fund that are performed and
3-7 assumed, in the absence of a contract, by the custodian of the
3-8 endowment fund. The custodian shall furnish to the commission,
3-9 annually or more frequently if required by commission rule, a sworn
3-10 statement of the amount of the endowment fund assets in the
3-11 custodian's custody.
3-12 (k) For purposes of this section, the beneficiaries of the
3-13 Texas cultural endowment fund are the persons who appreciate art,
3-14 artists, and arts organizations that benefit from the performance
3-15 of the commission's powers and duties under this chapter.
3-16 SECTION 5. Section 444.026, Government Code, as added by
3-17 Section 4 of this Act, is amended by adding Subsection (e) to read
3-18 as follows:
3-19 (e) Notwithstanding Subsection (c), the commission may not
3-20 transfer from the endowment fund the amount of interest or income
3-21 earned on money deposited in the endowment fund under Section
3-22 154.603(b)(1), Tax Code, that is equal to the amount of private
3-23 monetary donations made to the endowment fund during the fiscal
3-24 year in which the interest or income was earned. Interest or
3-25 income remaining in the endowment fund under this subsection
3-26 becomes part of the corpus of the endowment fund. This subsection
3-27 expires September 1, 2005.
3-28 SECTION 6. Chapter 88, General Laws, Acts of the 41st
3-29 Legislature, 2nd Called Session, 1929 (Article 6675a-1 et seq.,
3-30 Vernon's Texas Civil Statutes), is amended by adding Section 5m to
3-31 read as follows:
3-32 Sec. 5m. (a) The department shall design and provide for
3-33 the issuance of special Texas Commission on the Arts plates for
3-34 passenger cars and light commercial motor vehicles having a
3-35 manufacturer's rated carrying capacity of one ton or less.
3-36 (b) The license plates must bear the words "State of the
3-37 Arts" and be of a color, quality, and design approved by the Texas
3-38 Commission on the Arts.
3-39 (c) The department shall issue a license plate under this
3-40 section to a person who:
3-41 (1) applies to the county tax collector in the county
3-42 of the person's residence on a form provided by the department; and
3-43 (2) pays the fee prescribed by Subsection (e) of this
3-44 section.
3-45 (d) A person applying for a license plate under this section
3-46 may:
3-47 (1) have a license plate number assigned by the
3-48 department; or
3-49 (2) apply for a personalized prestige license plate
3-50 under Section 5c of this Act.
3-51 (e) The fee for issuance of a special license plate under
3-52 this section is $25 a year in addition to the regular registration
3-53 fee for the vehicle imposed by Section 5 of this Act and, if a
3-54 personalized prestige license plate is issued, in addition to the
3-55 fee imposed by Section 5c of this Act.
3-56 (f) The department shall deposit $20 of each fee collected
3-57 under this section in the state treasury to the credit of the Texas
3-58 Commission on the Arts operating fund established under Section
3-59 444.027, Government Code.
3-60 (g) The department shall deposit the remainder of each fee
3-61 collected under this section after deposit as provided by
3-62 Subsection (f) of this section in the state treasury to the credit
3-63 of the State Highway Fund to be used only to defray the cost of
3-64 administering this section.
3-65 (h) If a license plate issued under this section is lost,
3-66 stolen, or mutilated, the owner of the vehicle for which the plate
3-67 was issued may obtain a replacement plate from the department by
3-68 paying a replacement fee of $5. If the owner of a vehicle for
3-69 which the plate was issued under this section disposes of the
3-70 vehicle during a registration year, the person shall return the
4-1 special license plate to the department.
4-2 (i) There is no limit to the number of passenger cars and
4-3 light commercial motor vehicles for which a person may apply for
4-4 issuance of a license plate under this section.
4-5 SECTION 7. (a) Except as provided by Subsection (b) of this
4-6 section, this Act takes effect September 1, 1993.
4-7 (b) Section 5 of this Act takes effect September 1, 1993,
4-8 but only if the change in law proposed by H.B. No. 706, 73rd
4-9 Legislature, Regular Session, 1993, amending Section 154.603, Tax
4-10 Code, takes effect on or before that date. If H.B. No. 706 does
4-11 not take effect on or before September 1, 1993, Section 5 of this
4-12 Act has no effect.
4-13 SECTION 8. The importance of this legislation and the
4-14 crowded condition of the calendars in both houses create an
4-15 emergency and an imperative public necessity that the
4-16 constitutional rule requiring bills to be read on three several
4-17 days in each house be suspended, and this rule is hereby suspended.
4-18 * * * * *
4-19 Austin,
4-20 Texas
4-21 May 3, 1993
4-22 Hon. Bob Bullock
4-23 President of the Senate
4-24 Sir:
4-25 We, your Committee on Finance to which was referred S.B. No. 778,
4-26 have had the same under consideration, and I am instructed to
4-27 report it back to the Senate with the recommendation that it do not
4-28 pass, but that the Committee Substitute adopted in lieu thereof do
4-29 pass and be printed.
4-30 Montford,
4-31 Chairman
4-32 * * * * *
4-33 WITNESSES
4-34 No witnesses appeared on S.B. No. 778.