ZEM C.S.H.B. 539 75(R)BILL ANALYSIS


CIVIL PRACTICES
C.S.H.B. 539
By: Uher
4-1-97
Committee Report (Substituted)



BACKGROUND 

The civil liability of 'charitable organizations' is limited.  Because
chambers of commerce are not classified as 'charitable organizations' for
liability purposes, insurance costs often prevent chambers of commerce,
especially in smaller communities, from buying liability insurance for
board members and executives.  This, in turn, may make it difficult for
chambers of commerce to attract members and executives. 

PURPOSE

This legislation broadens the definition of a 'charitable organization' to
include local chambers of commerce in order to limit the liability of
chambers of commerce. 

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 Section 84.003(1), Civil Practices and Remedies Code, by
adding Subsection (D) which expands the definition of 'charitable
organizations' to include local chambers of commerce which are exempt from
federal income tax under Section 501(a) & 501(c)(6) of the Internal
Revenue Code and which do not participate in political campaigns or
contribute to political action committees. 

SECTION 2. Amends Section 84.007, Civil Practices and Remedies Code, by
adding Subsection (h) to provide that this chapter does not apply to a
cosponsor of an event with a local chamber of commerce. 

SECTION 3. Effective date:  September 1, 1997. Applies prospectively;
savings clause. 

SECTION 4. Emergency clause.


COMPARISON OF ORIGINAL TO SUBSTITUTE

The committee substitute makes the following changes:

(1)  adds that a local chamber of commerce must not participate in
political campaigns or contribute to political action committees in order
to qualify as a charitable organization exempt from liability. 

(2) specifies that this chapter does not apply to cosponsors of events
with local chambers of commerce.