JKM C.S.H.B. 3512 75(R)BILL ANALYSIS


ECONOMIC DEVELOPMENT
C.S.H.B. 3512
By: Greenberg
4-12-97
Committee Report (Substituted)




BACKGROUND 

Many government functions are being privatized in an effort to save
taxpayers money.  The privatization of state functions results in a need
for fewer state employees and reductions in force. Because many of the
employees who lose their jobs in privatization efforts have been quality
employees and lost their jobs through no fault of their own, the state
should provide them assistance in finding new employment. 

PURPOSE

To provide assistance and benefits to displaced state employees in the
forms of outplacement services, employment preference, and retirement
benefits.  

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 Subtitle B, Title 6, Government Code by adding Chapter
666 entitled EMPLOYMENT PREFERENCES FOR FORMER STATE EMPLOYEES, as
follows: 

 Sec. 666.001 DEFINITION. Defines a state agency as a department,
commission, board, office, council, or other agency in the executive or
judicial branch of state government created by state statute or by the
constitution, including university system or institution of higher
education. 

 Sec. 666.002 STATE EMPLOYMENT PREFERENCE. Provides that a former state
employee, whose position was eliminated due to a reduction in force or
privatization of a state service, has preference for employment or
appointment at a state agency over other applicants for the same position
who do not have a greater qualification. 

 Sec. 666.003. OUTPLACEMENT SERVICES. Requires that the Texas Workforce
Commission establish outplacement services for former employees of a state
agency which has reduced its workforce by not fewer than 25 employees, or
has eliminated not fewer than 25 positions due to privatization.  Requires
that the outplacement services include: reasonable access to career
centers, assistance in locating other available state employment,
counseling regarding unemployment benefits, and instruction on resume
drafting and other career-related services.  Allows the Texas Workforce
Commission to contract with a private enterprise to provide the
outplacement services  under this section. 

SECTION 2. Subchapter B, Chapter 814, Government Code is amended by adding
Section 814.1041, entitled RETIREMENT INCENTIVE FOR EMPLOYEE CLASS, as
follows:  

 (a) States that a member of the employee class may retire under this
section if the member has at least a minimum amount of service credit
required under current statute and is  at least 50 years of age and is not
more than three years younger that the minimum age required. (b) States
that this section does not apply to retirement under Section 814.107.  (c)
A member eligible to retire under this section is one who meets minimum
age and service requirements under Section 814.104, except as  provided by
Subsection (a) of this section;  applies for service retirement;  holds a
position included in the employee class on the date the application is
filed; and  designates an effective date of retirement that is after
August 31, 1997, but before September 1, 1999, and is the later of
September 30, 1997, or the earliest date that the member's retirement may
become effective. 

 (d) Requires the retirement system to report to the comptroller the name
of each person who retires under this section: the effective date of the
person's retirement, the entity by which the person was employed, and the
amount of compensation used in computing the person's annuity. Also
requires the retirement system submit reports under this subsection at the
times and in the manner the comptroller provides. 

 (e) Except as provided below in Subsection (f), the comptroller shall
reduce the total amount of legislative appropriations to the entity by
which the retiring member was employed immediately before retirement by
the amount of the reported compensation multiplied by the number of months
remaining in the fiscal biennium. 

 (f) The comptroller may not reduce appropriations under Subsection (e) if
the total legislative appropriations to the entity for the fiscal year in
which the employee retires, or for any subsequent fiscal year in the
biennium, are less than $1 million. 

 (g) Limits this section to employees whose positions were eliminated due
to a reduction in the workforce or a privatization of the employees'
positions. 

 (h) This section expires September 1, 1999.

SECTION 3.  Chapter 2252, Government Code, is amended by adding Subchapter
D, entitled PRIVATIZATION OF STATE SERVICES, as follows:. 

 Sec. 2252.091. DEFINITION. In this subchapter, "state agency" means a
department, commission, board, office, council, or other agency in the
executive or judicial branch of state government that is created by the
state constitution or statute including a university system or institution
of higher education. 

 Sec. 2252.092 CONTRACTS. States that a  contract between a state agency
and a private entity that contracts to provide services formerly provided
by state employees shall require the private entity to provide at least
the same compensation and benefits to its employees as the state provided
to employees performing similar services. 

SECTION 4.  Amends Subchapter A, Chapter 2254, Government Code, by adding
Section 2254.006, entitled CONTRACT FOR PROFESSIONAL SERVICES OF FORMER
STATE EMPLOYEE. Subsection (a) prohibits a governmental entity from
contracting with a former state employee for  professional services if not
more than a year has passed since the employee's retirement under Section
814.1041.  Subsection (b) states that this Section expires September 1,
2000. 


SECTION 5. Amends Subchapter B, Chapter 2254, Government Code, by adding
Section2254.0261, CONTRACT FOR CONSULTING SERVICES OF FORMER STATE
EMPLOYEE, which states that a former state employee who has taken the
early retirement incentive provided in this bill may not receive a
contract for consulting services from an agency within the twelve months
following the date of retirement. 
 
SECTION 6. Effective Date is September 1, 1997.

SECTION 7. Emergency Clause.


COMPARISON OF ORIGINAL TO SUBSTITUTE

SECTION 1.  CSHB 3512, Sec. 666.003, adds Subsection (c) which states that
the Texas Workforce Commission may contract with private enterprise to
provide the outplacement services required by this section. 

SECTION 2.  CSHB 3512, Sec. 814.1041, removes language regarding
consulting and professional services from its location in HB 3512,
Subsection (a).  CSHB 3512 places this language in new SECTIONS 4 and 5,
and subdivides the remaining language in CSHB 3512, SECTION 2.  CSHB 3512
adds to Subsection (a) the requirement that an employee be at least 50
years of age to qualify for retirement under this section.  CSHB 3512 adds
Subsection (g) which limits the retirement incentive to state employees
whose position was eliminated due to a reduction in the workforce or a
privatization of the employee's position. 

SECTION 4 is added to CSHB 3512 to expand on language concerning
professional services which was located in HB 3512 in SECTION 2, Sec.
814.1041, Subsection (a).  CSHB 3512, Subsection (a) prohibits a
governmental entity from contracting with a former state employee for
professional services if not more than a year has passed since the
employee's retirement under Section 814.1041. Subsection (b) states that
this Section expires September 1, 2000.  Renumbers subsequent sections
accordingly. 

SECTION 5. is added to CSHB 3512 to expand on language concerning
consulting services which was located in HB 3512 in SECTION 2, Sec.
814.1041, Subsection (a).  CSHB 3512,  which states that a former state
employee who has taken the early retirement incentive provided in this
bill may not receive a contract for consulting services from an agency
within the twelve months following the date of retirement.  Renumbers
subsequent sections accordingly.