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.