BILL ANALYSIS



H.B. 1091
By: Brimer
2-21-95
Committee Report (Amended)


BACKGROUND

     The 71st Legislature created the Texas Workers' Compensation
Research Center (research center) in 1989 to provide objective
information on the workers' compensation insurance system in Texas
to policymakers.  The research center serves as an advisory body to
the Texas Workers' Compensation Commission (TWCC) and is charged
with developing factual, fair and unbiased research, findings, and
conclusions in key areas of the workers' compensation system.  To
conduct research, the research center may access the files and
records of TWCC, the Texas Employment Commission (TEC), the Texas
Department of Insurance (TDI), the Texas Department of Human
Services (TDHS) and other state agencies.  To support these
functions, the research center had a budget of $709,503 and 8
employees for fiscal year 1994.

     The Legislative Oversight Committee on Workers' Compensation
(LOC) was created in 1991, as part of the Workers' Compensation
Act.  The purpose of the LOC is to report to the Governor, Lt.
Governor, and Speaker of the House on any problems in the workers'
compensation system with recommendations for commission and
legislative action; provide an evaluation of the research conducted
by the research center with recommendations for any additional
necessary research; and monitor the effectiveness of the workers'
compensation system to provide adequate, equitable, and timely
benefits to injured workers at a reasonable cost to employers.  To
carry out its functions, the LOC was budgeted $196,037 and 5
employees for fiscal year 1994.

PURPOSE

     The purpose of this bill is to create the Research and
Oversight Council on Workers' Compensation, and merge the functions
and responsibilities of the Texas Workers' Compensation Research
Center and the Legislative Oversight Committee on Workers'
Compensation in this new entity.  The Texas Workers' Compensation
Research Center and its board, and the LOC would be abolished.  The
Research and Oversight Council on Workers' Compensation would be
responsible for doing research on and monitoring the effectiveness
of the workers' compensation system.  The bill also includes the
recommendations of the Sunset Advisory Commission regarding the
research center.  Modifications proposed by this bill:

     restructure the board of directors to include three members of
     the Senate, three members of the House of Representatives, one
     TWCC commissioner who represents employees, one TWCC
     commissioner who represents employers, and the commissioner of
     insurance or a designee;

     require the council to identify, collect, maintain and analyze
     key information needed to assess the operational effectiveness
     of the state's workers' compensation system and provide
     information to the Governor and the Legislature on a quarterly
     basis;

     require the council to collect information from the Texas
     Workers' Compensation Insurance Fund and determine its impact
     on the workers' compensation system;

     authorize the council to seek and use federal funds; and

     provide for other changes.

RULEMAKING AUTHORITY

     It is the committee's opinion that this bill does not
expressly grant any additional rulemaking authority to a state
officer, department, agency, or institution.  

SECTION BY SECTION ANALYSIS

     SECTION 1.  Amends Chapter 404, Labor Code.  Changes the name
of the chapter from the TEXAS WORKERS' COMPENSATION RESEARCH CENTER
to the RESEARCH AND OVERSIGHT COUNCIL ON WORKERS' COMPENSATION.

     Sec. 404.001. Defines the "Board" as the board of directors of
the council, "council" as the Research and Oversight Council on
Workers' Compensation, and "Executive Director" as the executive
director of the council.

     Sec. 404.0015. Subjects the Research and Oversight Council to
Chapter 325, Government Code (Sunset Act) and sets the council's
Sunset date as September 1, 2007, which provides for the usual 12-year review.

     Sec. 404.002. (a) Establishes the council as an advisory body
to the commission, and requires the council to be operated in a
manner that ensures research is factual, fair, and unbiased.

     (b) Requires the council to conduct professional studies and
research formerly done by the research center.  Adds studying the
Workers' Compensation Insurance Fund and its impact on the workers'
compensation system to the council's duties.

     (c) Transfers the research center's duty to conduct studies
related to drugs in the workplace to the council.

     (d) Requires the council to identify, collect, maintain, and
analyze key information to assess the operational effectiveness of
the workers' compensation system, and to provide this information
to the Legislature on a quarterly basis.

     (e) Authorizes the council, with the approval of the board, to
apply for and spend federal funds.

     Sec. 404.003. (a) Amends language to substitute "council" for
"research center."  Specifies that the council is funded by the
maintenance tax.

     (e) Requires amounts received from the maintenance tax to be
deposited in a special account for the operation of the council and
requires the council to reimburse the general revenue fund in
accordance with Article 4.19, Insurance Code.  Changes the word
"fund" to "account."

     (f) Exempts the account established in subsection (e) from
fund consolidation requirements of the Government Code.

     Sec. 404.004. (a) Changes the composition of the board. 
Requires the board to be composed of three senators, appointed by
the lieutenant governor; three members of the house of
representatives, appointed by the speaker of the house of
representatives; a member of the Texas Workers' Compensation
Commission representing labor, appointed by the commissioners; a
member of the Texas Workers' Compensation Commission representing
employers, appointed by the commissioners; and the commissioner of
insurance or a person designated by the commissioner.  Deletes
language related to the composition of the research center board.

     (b) Deletes language related to appointment of public members.

     (c)  Reletters subsection.

     (d) Adds standard language developed by the Sunset Commission. 
Prohibits employees compensated at or above Group 17 in the
appropriations act from being an officer or employee of a related
Texas trade association.

     (e) Adds standard language developed by the Sunset Commission. 
Defines a Texas trade association.

     (f) Adds standard language developed by the Sunset Commission. 
Requires the board of directors to clearly separate its
policymaking responsibilities from the management responsibilities
of the executive director and staff of the council.  Deletes
language related to the use of the term "disability."

     Sec. 404.0041. Adds standard language developed by the Sunset
Commission.  Prohibits registered lobbyists from serving as the
general counsel of the board or the council.

     Sec. 404.005. (a) Provides that a person appointed to the
board serves at the will of the appointing state officer or agency. 
Deletes language defining the terms of the members.

     (b) Requires the appointing officer or agency to appoint a
qualified replacement if a vacancy occurs on the board.  Reletters
subsection.

     (c) Specifies that the Commissioner of Insurance serves as an
ex officio member of the board as long as he or she is
Commissioner.  Provides the Commissioner or designee with the
authority to vote on any matter before the board.

     Sec. 404.0055. (a) - (c) Adds standard language developed by
the Sunset Commission.  Defines the grounds for removing a board
member and requires notification of the council's presiding
officer, the governor and the attorney general if knowledge that a
potential ground for removal exists.  Affirms that an action of the
board is valid even if it is taken when a ground for removal exists
for one of the members.

     (d) Clarifies that the use of the term "disability" in Sec.
401.011(16) does not apply to the use of the term "disability" in
subsection (a).

     Sec. 404.006. (a) Requires the council to have a chairman and
vice-chairman as presiding officers, and that they serve in this
capacity for two-year terms.  Requires the lieutenant governor and
speaker of the house of representatives to alternate in the
selection of the chairman and vice-chairman, with the speaker of
the house of representatives designating the first chairman and the
lieutenant governor selecting the first vice-chairman.

     (b) Specifies that the period of service for the chairman and
vice-chairman expire on February 1 of each even-numbered year. 
Authorizes the chairman and vice-chairman to vote on all matters
before the board.

     (c) Provides for the board to meet as necessary at the call of
the chairman.  Reletters subsections.

     Sec. 404.007. (a) Specifies the general powers and duties of
the board and requires the board to approve the operating budget of
the council; adopt rules for the operation of the board and the
council; conduct professional studies and research on all matters
relevant to the cost, quality, and operational effectiveness of the
workers' compensation system; monitor the cost of income benefits,
with emphasis on the availability and cost of supplemental income
benefits; monitor the performance and operation of the Texas
Workers' Compensation Insurance Fund, with emphasis on the insurer
of last resort program; meet regularly with any public or private
sector entity involved in the workers' compensation system; receive
information about rules adopted or proposed by any entity in the
workers' compensation system; and review specific recommendations
for legislation proposed by any entity in the workers' compensation
system.

     (b) Requires the board to report to the governor, lieutenant
governor and speaker of the house no later than December 31 of each
even-numbered year.  Requires the report to include: activities of
the council; identification of any problem identified in the
workers' compensation system, with recommendations for regulatory
and legislative action based on research and testimony; and the
status of the effectiveness of the workers' compensation system to
provide adequate, equitable and timely benefits for injured workers
at a reasonable cost to employers, with recommendations for any
additional research.  Deletes language requiring the board to
ensure the quality of research products and the economy in the use
of  funds for projects contracted with and conducted by educational
institutions or other public or private research institutions and
workers' compensation experts.

     (d) Allows the board to delegate powers to the executive
director as it considers appropriate including general guidance on
the identification of information needs and the conduct of
research.  Provides the board with the authority to contract with
other persons, including institutions of higher education, for
economics and quality studies; appoint expert advisory committees
to provide technical assistance in conducting research; and request
reports or other information from appropriate agencies.

     Sec. 404.008. (a) Requires the board to employ an executive
director to administer the council who serves at the pleasure of
the board.

     (b) Requires the executive director to hire staff as necessary
to accomplish the objectives of the council.  Authorizes the
executive director to delegate powers and duties to the staff as
necessary.

     (c) Changes "research center" to "council."

     (d) Adds standard language developed by the Sunset Commission. 
Requires the executive director to prepare an annual financial
report that meets the reporting requirements in the General
Appropriations Act.

     (e) Adds standard language developed by the Sunset Commission. 
Requires the executive director to develop an intra-agency career
ladder program that addresses mobility and advancement
opportunities for employees within the council and requires intra-agency posting of job openings concurrently with any public
posting.

     (f) Adds standard language developed by the Sunset Commission. 
Requires the executive director to develop a system of annual
performance evaluations based on documented employee performance
and upon which merit salary increases must be based.

     (g) - (i) Adds standard language developed by the Sunset
Commission.  Requires the executive director or a designee to
develop an equal employment policy that is annually updated,
reviewed by the Texas Commission on Human Rights, and filed with
the Governor's Office.

     (j) Adds standard language developed by the Sunset Commission. 
Requires the board to inform its members and employees of the
qualifications for office or employment and each person's
responsibilities under the law.

     Sec. 404.0091. (a) Adds standard language developed by the
Sunset Commission.  Requires the council to prepare and distribute
information to the public concerning the council's functions and
complaint procedures.

     (b) Adds standard language developed by the Sunset Commission. 
Requires the board to give the public reasonable opportunity to
appear before it regarding issues under the jurisdiction of the
council.

     (c) Adds standard language developed by the Sunset Commission. 
Requires the council to comply with state and federal program and
facility accessibility laws and to develop a plan that describes
how non-English speaking persons can be provided reasonable access
to the council's programs.

     Sec. 404.0092. (a) Adds standard language developed by the
Sunset Commission.  Requires the council to collect and maintain
information about all written complaints filed with the council.

     (b) Adds standard language developed by the Sunset Commission. 
Requires the council to maintain files on written complaints that
the council has the authority to resolve and to notify the parties
regarding the status of the complaint quarterly until disposition.

     Sec. 404.010. (a) Adds authority for the council to access the
files and records of the Texas workers' compensation insurance
facility, Texas Workers' Compensation Insurance Fund, and other
agencies related to workers' compensation.

     (b) - (c) Changes "research center" to "council."

     SECTION 2.  Abolishes the Legislative Oversight Committee on
Workers' Compensation by repealing Chapter 405, Labor Code.

     SECTION 3.  (a) Abolishes the Texas Workers' Compensation
Research Center and the board of directors and transfers all state
records and other property, employees, and unexpended and
unobligated appropriations of the Texas Workers' Compensation
Research Center or the board of directors to the Research and
Oversight Council on Workers' Compensation.  Clarifies that any
reference in law to the research center or its board of directors
means the Research and Oversight Council on Workers' Compensation
or its board of directors.

     (b) Recreates and redesignates the special fund created under
Section 404.003, Labor Code as a special account to be used for the
purposes cited in Section 404.003, Labor Code.

     SECTION 4. Requires the board of directors and the executive
director of the Research and Oversight Council on Workers'
Compensation to adopt policies as required by the Act no later than
January 1, 1996.

     SECTION 5. Provides for the initial chairman of the board of
directors of the Research and Oversight Council on Workers'
Compensation to serve as chair until February 1, 1998.

     SECTION 6. Specifies the effective date of the Act as
September 1, 1995.

     SECTION 7. Emergency clause.

Explanation of Amendments

COMMITTEE AMENDMENT #1 amends new Section 404.0055, Labor Code. 
This amendment is a technical correction and modifies standard
Sunset language related to who should be notified if grounds for
removal of a board member exist.  Deletes "governor and the
attorney general" and substitutes "lieutenant governor, the speaker
of the house of representatives, and the attorney general." 
Because the lieutenant governor and speaker of the house appoint
members of the board, they, and not the governor, should be
notified if grounds for removal exist.  The governor does not
appoint any members of the board.

COMMITTEE AMENDMENT #2 amends Section 404.007, Labor Code.  This
amendment is a technical correction and deletes "quality and
economics studies" and substitutes "economical studies of high
quality".  This amendment authorizes the board to contract for
studies that are economical, rather than economic studies.

COMMITTEE AMENDMENT #3 amends Section 404.007, Labor Code.  This
amendment is a technical correction and deletes "meet regularly
with" and substitutes "hold regular public hearings and receive
testimony and reports from".  This amendment would clarify the
purpose of the meetings that the board may hold with the Texas
Workers' Compensation Commission, the Texas Workers' Compensation
Insurance Fund, the Texas workers' compensation insurance facility,
the Texas Department of Insurance, the office of the attorney
general, and any other public or private entity that is involved in
the workers' compensation system.

SUMMARY OF COMMITTEE ACTION

House Bill 1091 was considered in a public hearing on February 21,
1995.  Testifying on the bill were David Holland, representing
Sunset Advisory Commission, and Ken Levine, representing Sunset
Advisory Commission.  Testifying for the bill were George B. Allen,
representing Texas Apartment Association, Pam Beachley,
representing Business Insurance Consumers Association, Roy Evans,
representing himself, Joe Hanson, representing Texas Association of
Business and Chambers of Commerce, Ted Roberts, representing Texas
Association of Business and Chambers of Commerce, and Ms. Dillon
Snowden, representing Texas Association of Rehabilitation
Professionals in Private Sector.  Testifying against the bill were
Joseph Hamilton, representing himself, and Sam D. Seale,
representing Texas Association of Counties.  The Business and
Industry Committee considered three (3) amendments to the bill. 
Three of those amendments were adopted without objection.  A motion
to report H.B. 1091, as amended, to the full house with the
recommendation that it do pass and be printed carried with a record
vote of 8 ayes, 0 nays, 0 present-not-voting, and 1 absent.  The
vote by which H.B. 1091, as amended, was reported favorably was
reconsidered without objection.  A motion to report H.B. 1091, as
amended, to the full House with the recommendation that it do pass
and be printed carried with a record vote of 9 ayes, 0 nays, 0
present-not-voting, and 0 absent.