IMF H.B. 2520 75(R)BILL ANALYSIS STATE AFFAIRS H.B. 2520 By: Gallego 5-9-97 Committee Report (Substituted) BACKGROUND The Joint General Investigating Committee studied the conservatorship process while working to help the Texas Commission on Alcohol and Drug Abuse (TCADA) begin to repair its administration and functions. TCADA was the first and only state agency ever placed in conservatorship and the General Investigating Committee found the experience helpful in finding ways to improve the conservatorship process. PURPOSE As proposed, C.S.H.B. 2520 would change the current structure and function of the State Conservatorship Board. The new structure, as proposed by this bill, would dissolve the current board and allow the governor to appoint a conservator when necessary to address gross fiscal mismanagement by a state agency or public junior college. C.S.H.B. 2520 also establishes guidelines for the legislative audit committee to recommend that the governor appoint a conservator. RULEMAKING AUTHORITY It is the committee's opinion that this bill does expressly grant additional rulemaking authority to a conservator appointed by the Governor in SECTION 1 (Sec. 2104.014, Government Code) of the bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 2104 of the Government Code as follows: Section 2104.001(1) deletes "board," replaces it with "conservator," and defines "conservator." Section 2104.011 makes conforming changes and provides that the term of a conservator is two years or when th conservatorship is dissolved whichever is earlier Section 2104.012(a) allows a conservator to receive a salary. Section 2104.012(b) requires the entity in conservatorship to pay the salary of the conservator. Section 2104.013 makes conforming changes. Section 2104.014 allows the conservator to adopt rules. Section 2104.015 makes a conforming change. Section 2104.021(a) allows the legislative audit committee on finding that gross fiscal mismanagement exists to either: notify the governor and recommend that a board of conservatorship be appointed; recommend that the agency enter into a rehabilitation plan; or recommend that the governor appoint a board is the agency does not enter a rehabilitation program. Section 2104.021(b) allows the governor to appoint a conservator on notification of gross fiscal mismanagement from the legislative audit committee. Section 2104.0215(a) requires a state agency that agrees to enter into a rehabilitation plan to use the services of an independent management consulting team approved by the governor and the legislative audit committee. Section 2104.0215(b) requires the state agency using a independent management consulting team to pay for the cost of the team out of its current appropriations. Section 2104.0215(c) requires the independent management consulting team to assist the state agency in developing its rehabilitation plan including performance goals. Section 2104.0215(d) requires the state auditor to notify the legislative audit committee if the auditor feels the state agency is not making significant progress in its rehabilitation plan. Section 2104.022 makes a conforming change. Section 2104.023 makes a conforming change. Section 2104.024 makes a conforming change. Section 2104.025 makes no change. Section 2104.031 makes a conforming change. Section 2104.032 makes a conforming change. Section 2104.033 makes no change. SECTION 2(a). Provides that the terms of all members of the State Conservatorship Board end on the effective date of this Act unless a state agency is under the conservatorship of the board. If on the effective date of this Act a state agency is under conservatorship, the terms of the board members end when conservatorship is dissolved. SECTION 2(b). Makes this Act prospective. SECTION 3. Emergency clause. Effective date: upon passage. COMPARISON OF ORIGINAL TO SUBSTITUTE SECTION 1 of the substitute changes the structure of the State Conservatorship Board to allow the governor to appoint a singe conservator instead of an entire board. The original changed the structure of the Board to allow the governor to appoint numerous boards.