By Rodriguez                                          H.B. No. 1739
       74R6274 ESH-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to certain conflicts of interest involving a member of the
    1-3  board of trustees of a school district.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Section 23.201, Education Code, is amended to
    1-6  read as follows:
    1-7        Sec. 23.201.  Eligibility to Contract With Board.  (a)  The
    1-8  board of trustees of a school district may not enter into a
    1-9  contract with a trustee of the district, the spouse of a trustee,
   1-10  or a business entity in which a trustee or the spouse of a trustee
   1-11  has a significant interest until the trustee's current term has
   1-12  expired or until the trustee has resigned and a successor has been
   1-13  chosen to fill the vacancy created by the resignation.
   1-14        (b)  <In this section, the term "business entity" has the
   1-15  meaning provided by Section 171.001, Local Government Code.>
   1-16        <(c)>  For purposes of this section, a person has a
   1-17  significant <substantial> interest in a business entity if the
   1-18  person:
   1-19              (1)  owns 10 percent or more of the voting stock or
   1-20  shares of the business entity or owns either 10 percent or more or
   1-21  $5,000 or more of the fair market value of the business entity; or
   1-22              (2)  is employed by the entity and:
   1-23                    (A)  is authorized to determine the terms under
   1-24  which the entity will contract with the board of trustees; or
    2-1                    (B)  represents the entity in negotiating the
    2-2  contract with the board of trustees <has a substantial interest in
    2-3  the business entity for purposes of Chapter 171, Local Government
    2-4  Code>.
    2-5        (c)  In this section, "business entity" means a sole
    2-6  proprietorship, partnership, firm, corporation, holding company,
    2-7  joint-stock company, receivership, trust, or any other entity
    2-8  recognized by law <(d)  This section prevails over Chapter 171,
    2-9  Local Government Code, to the extent of any conflict>.
   2-10        SECTION 2.  Subchapter A, Chapter 23, Education Code, is
   2-11  amended by adding Section 23.202 to read as follows:
   2-12        Sec. 23.202.  AFFIDAVIT AND ABSTENTION FROM VOTING REQUIRED
   2-13  IN CERTAIN REAL PROPERTY TRANSACTIONS.  (a)  Before a vote or
   2-14  decision by the board of trustees of a school district on any
   2-15  matter involving a specific piece of real property, a member who
   2-16  has a significant interest in the property or whose spouse has a
   2-17  significant interest in the property shall:
   2-18              (1)  file an affidavit stating the nature and extent of
   2-19  the interest; and
   2-20              (2)  abstain from further participation in the matter
   2-21  if it is reasonably foreseeable that an action on the matter will
   2-22  have a special economic effect on the value of the property,
   2-23  distinguishable from its effect on the public.
   2-24        (b)  The affidavit must be filed with the secretary of the
   2-25  board of trustees.
   2-26        (c)  If a member is required to file and does file an
   2-27  affidavit under Subsection (a), the member is not required to
    3-1  abstain from further participation in the matter requiring the
    3-2  affidavit if a majority of the members of the board of trustees are
    3-3  persons who are likewise required to file and who do file
    3-4  affidavits of similar interests on the same official action.
    3-5        (d)  For purposes of this section, a person has a significant
    3-6  interest in real property if the interest is an equitable or legal
    3-7  ownership with a fair market value of $2,500 or more.
    3-8        SECTION 3.  Sec. 171.001(1), Local Government Code, is
    3-9  amended to read as follows:
   3-10              (1)  "Local public official" means a member of the
   3-11  governing body or another officer, whether elected, appointed,
   3-12  paid, or unpaid, of any district <(including a school district)>,
   3-13  county, municipality, precinct, central appraisal district, transit
   3-14  authority or district, or other local governmental entity who
   3-15  exercises responsibilities beyond those that are advisory in
   3-16  nature.   The term does not include a member of the board of
   3-17  trustees of an independent school district.
   3-18        SECTION 4.  This Act takes effect September 1, 1995, and
   3-19  applies only to a contract entered into by the board of trustees of
   3-20  a school district on or after that date.
   3-21        SECTION 5.  The importance of this legislation and the
   3-22  crowded condition of the calendars in both houses create an
   3-23  emergency and an imperative public necessity that the
   3-24  constitutional rule requiring bills to be read on three several
   3-25  days in each house be suspended, and this rule is hereby suspended.