By Stiles H.B. No. 1877
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the authority of the board of regents of The University
1-3 of Texas System to delegate certain powers and duties of the board.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 65.31(c), Education Code, is amended to
1-6 read as follows:
1-7 (c) The board has authority to promulgate and enforce such
1-8 other rules and regulations for the operation, control and
1-9 management of the university system and the component institutions
1-10 thereof as the board may deem either necessary or desirable,
1-11 including rules and regulations delegating to its committees,
1-12 officers, employees, or other agents the authority to perform such
1-13 duties and powers of the board as are designated by the board.
1-14 SECTION 2. Section 65.34(a), Education Code, is amended to
1-15 read as follows:
1-16 (a) A contract <All contracts with architects, plan makers,
1-17 landscapers, or draftsmen, or with any other person, firm, or
1-18 corporation of whatever name or designation> shall be <absolutely
1-19 void unless> approved by the <signed written vote of a majority of
1-20 the> board or otherwise made and entered into in accordance with
1-21 rules and regulations of the board related to contracting authority
1-22 <in a regular or called meeting assembled>.
1-23 SECTION 3. Section 66.08, Education Code, is amended to read
2-1 as follows:
2-2 Sec. 66.08. <EXTERNAL> INVESTMENT MANAGEMENT <MANAGERS>.
2-3 The board of regents of The University of Texas System may delegate
2-4 investment authority and contract for the investment of the
2-5 permanent university fund to the same extent as governing boards of
2-6 institutions of higher education are authorized to do for
2-7 institutional funds by the Uniform Management of Institutional
2-8 Funds Act (Chapter 163, Property Code) <with private investment
2-9 managers to assist the board in making investments of the permanent
2-10 university fund>.
2-11 (b) In addition to other investment powers granted to it,
2-12 the board may contract with a non-profit corporation and delegate
2-13 to it the authority to act for the board in the investment of such
2-14 funds under the control and management of the board as are
2-15 designated by the board, including the permanent university fund,
2-16 subject to the provisions of this section.
2-17 (c) If the board contracts with a non-profit corporation
2-18 under this section, the board shall:
2-19 (1) dedicate the corporation solely to managing the
2-20 investment of funds under the control and management of the board
2-21 that are designated by the board;
2-22 (2) approve all articles of incorporation and by-laws
2-23 of the corporation and any amendment to the articles or the
2-24 by-laws;
2-25 (3) approve all investment policies of the corporation
3-1 and any changes to those policies;
3-2 (4) have the power to appoint and remove directors of
3-3 the corporation;
3-4 (5) appoint at least three board members and the
3-5 Chancellor of The University of Texas System as directors of the
3-6 corporation;
3-7 (6) require the corporation to file quarterly reports
3-8 with the board concerning such matters as may be required by the
3-9 board;
3-10 (7) require the corporation to be subject to all
3-11 provisions of the Texas Non-Profit Corporation Act (Article
3-12 1396-1.01, Vernon's Texas Civil Statutes), including those
3-13 provisions allowing the state auditor to audit books and records of
3-14 corporations assisting state agencies; and,
3-15 (8) require the corporation to have an audit and
3-16 ethics committee and a code of ethics approved by the board.
3-17 (d) A corporation entering into an agreement with the board
3-18 pursuant to subsection (b) may not enter into any agreement or
3-19 transaction with:
3-20 (1) a director, officer or employee of the corporation
3-21 acting in other than their official capacity with the corporation,
3-22 or with a business entity in which a director, officer, or employee
3-23 of the corporation has a business interest; or,
3-24 (2) a former director, officer, or employee of the
3-25 corporation or with a business entity in which a former director,
4-1 officer or employee of the corporation has a business interest, on
4-2 or before the second anniversary of the date the person ceased to
4-3 be a director, officer or employee of the corporation.
4-4 (e) An agreement or transaction entered into in violation of
4-5 subsection (d) is void and unenforceable.
4-6 (f) For purposes of this section, a person has an interest
4-7 in a business entity if:
4-8 (1) the person owns five percent or more of the voting
4-9 stock or shares of the business entity or owns five percent or more
4-10 of the fair market value of the business entity; or
4-11 (2) funds received by the person from the business
4-12 entity exceed five percent of the person's gross income for the
4-13 previous year.
4-14 (g) As used in this section:
4-15 (1) "Board" means the board of regents of The
4-16 University of Texas System;
4-17 (2) "Governing board," "institutional funds" and
4-18 "institution of higher education" have the meanings assigned by the
4-19 Uniform Management of Institutional Funds Act (Chapter 163,
4-20 Property Code).
4-21 SECTION 4. The importance of this legislation and the
4-22 crowded condition of the calendars in both houses create an
4-23 emergency and an imperative public necessity that the
4-24 constitutional rule requiring bills to be read on three several
4-25 days in each house be suspended, and this rule is hereby suspended,
5-1 and that this Act take effect and be in force from and after its
5-2 passage, and it is so enacted.