1-1 By: Montford S.B. No. 1577
1-2 (In the Senate - Filed March 13, 1995; March 22, 1995, read
1-3 first time and referred to Committee on Finance; April 10, 1995,
1-4 reported adversely, with favorable Committee Substitute by the
1-5 following vote: Yeas 10, Nays 0; April 10, 1995, sent to printer.)
1-6 COMMITTEE SUBSTITUTE FOR S.B. No. 1577 By: Montford
1-7 A BILL TO BE ENTITLED
1-8 AN ACT
1-9 relating to authorizing certain rules and contracts of the board of
1-10 regents of The University of Texas System concerning certain powers
1-11 and duties of the board.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Subsection (c), Section 65.31, Education Code, is
1-14 amended to read as follows:
1-15 (c) The board has authority to promulgate and enforce such
1-16 other rules and regulations for the operation, control, and
1-17 management of the university system and the component institutions
1-18 thereof as the board may deem either necessary or desirable,
1-19 including authorizing a committee, officer, employee, or other
1-20 agent of the board to perform such duties and powers as may be
1-21 designated by the board. The board is specifically authorized and
1-22 empowered to determine and prescribe the number of students that
1-23 shall be admitted to any course, department, school, college,
1-24 degree-program, or institution under its governance.
1-25 SECTION 2. Subsection (a), Section 65.34, Education Code, is
1-26 amended to read as follows:
1-27 (a) All contracts with architects, plan makers, landscapers,
1-28 or draftsmen, or with any other person, firm, or corporation of
1-29 whatever name or designation shall be unenforceable <absolutely
1-30 void> unless approved by the <signed written vote of a majority of
1-31 the> board or in accordance with rules and regulations of the board
1-32 <in regular or called meeting assembled>.
1-33 SECTION 3. Chapter 66, Education Code, is amended by adding
1-34 Section 66.081 to read as follows:
1-35 Sec. 66.081. CERTAIN INVESTMENT CONTRACTS. (a) The board
1-36 may enter into a contract with a nonprofit corporation for the
1-37 corporation to invest funds under the control and management of the
1-38 board, including the permanent university fund, as designated by
1-39 the board. The corporation may not engage in any business other
1-40 than investing funds designated by the board under the contract.
1-41 (b) A contract with a nonprofit corporation to invest funds
1-42 is subject to the provisions of this section and any rules and
1-43 regulations adopted by the board in furtherance of this section.
1-44 (c) The board must adopt the investment policies for any
1-45 funds to be invested by the corporation and must review at least
1-46 quarterly the investments of the corporation.
1-47 (d) The board must approve:
1-48 (1) any contract authorized by Subsection (a);
1-49 (2) the articles of incorporation and bylaws of the
1-50 corporation and any amendment to the articles of incorporation or
1-51 bylaws;
1-52 (3) the audit and ethics committee of the corporation;
1-53 and
1-54 (4) the code of ethics of the corporation.
1-55 (e) The board shall appoint all members of the board of
1-56 directors of the corporation, who shall serve at the pleasure of
1-57 the board.
1-58 (f) The corporation shall file quarterly reports with the
1-59 board concerning investment activities and other matters required
1-60 by the board.
1-61 (g) The corporation is subject to the Texas Non-Profit
1-62 Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil
1-63 Statutes).
1-64 (h) The corporation may not enter into an agreement or
1-65 transaction with a:
1-66 (1) director, officer, or employee of the corporation
1-67 acting in other than an official capacity on behalf of the
1-68 corporation;
2-1 (2) business entity in which a director, officer, or
2-2 employee of the corporation has an interest;
2-3 (3) former director, officer, or employee of the
2-4 corporation on or before the second anniversary of the date the
2-5 person ceased to be a director, officer, or employee of the
2-6 corporation; or
2-7 (4) business entity in which a former director,
2-8 officer, or employee of the corporation has an interest on or
2-9 before the second anniversary of the date the person ceased to be a
2-10 director, officer, or employee of the corporation.
2-11 (i) An agreement or transaction entered into in violation of
2-12 Subsection (h) is void.
2-13 (j) For purposes of this section, a person has an interest
2-14 in a business entity if:
2-15 (1) the person owns five percent or more of the voting
2-16 stock or shares of the business entity;
2-17 (2) the person owns five percent or more of the fair
2-18 market value of the business entity; or
2-19 (3) money received by the person from the business
2-20 entity exceeds five percent of the person's gross income for the
2-21 preceding calendar year.
2-22 (k) In this section:
2-23 (1) "Board" means the board of regents of The
2-24 University of Texas System.
2-25 (2) "Governing board" and "institution of higher
2-26 education" have the meanings assigned by Section 61.003, Education
2-27 Code.
2-28 SECTION 4. The importance of this legislation and the
2-29 crowded condition of the calendars in both houses create an
2-30 emergency and an imperative public necessity that the
2-31 constitutional rule requiring bills to be read on three several
2-32 days in each house be suspended, and this rule is hereby suspended,
2-33 and that this Act take effect and be in force from and after its
2-34 passage, and it is so enacted.
2-35 * * * * *