75R14167 JRD-D
By Gallego H.B. No. 2520
Substitute the following for H.B. No. 2520:
By Danburg C.S.H.B. No. 2520
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the conservatorship of state agencies and public junior
1-3 colleges as a result of fiscal mismanagement.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 2104, Government Code, is amended to read
1-6 as follows:
1-7 CHAPTER 2104. CONSERVATORSHIP AS A RESULT OF FISCAL
1-8 MISMANAGEMENT
1-9 SUBCHAPTER A. GENERAL PROVISIONS
1-10 Sec. 2104.001. DEFINITIONS. In this chapter:
1-11 (1) "Conservator" ["Board"] means a person appointed
1-12 by the governor to act as the conservator of a state agency or
1-13 public junior college in accordance with this chapter [the State
1-14 Conservatorship Board].
1-15 (2) "Gross fiscal mismanagement" includes:
1-16 (A) failure to keep adequate fiscal records;
1-17 (B) failure to maintain proper control over
1-18 assets;
1-19 (C) failure to discharge fiscal obligations in a
1-20 timely manner; and
1-21 (D) misuse of state funds.
1-22 (3) "State agency" means a department, commission,
1-23 board, office, or other agency, including a university system or an
1-24 institution of higher education other than a public junior college,
2-1 that:
2-2 (A) is in the executive branch of state
2-3 government;
2-4 (B) is created by statute; and
2-5 (C) does not have statutory geographical
2-6 boundaries limited to a part of the state.
2-7 (4) "State fiscal management policies" means laws or
2-8 rules relating to:
2-9 (A) fiscal recordkeeping and reporting;
2-10 (B) use or control of state property;
2-11 (C) timely discharge of fiscal obligations; or
2-12 (D) use of state funds.
2-13 Sec. 2104.002. APPLICABILITY OF CHAPTER. This chapter does
2-14 not apply to an agency that is under the direction of an elected
2-15 officer, board, or commission.
2-16 (Sections 2104.003-2104.010 reserved for expansion)
2-17 SUBCHAPTER B. CONSERVATORS [STATE CONSERVATORSHIP BOARD]
2-18 Sec. 2104.011. APPOINTMENT OF CONSERVATOR [BOARD
2-19 COMPOSITION]; TERMS. (a) A conservator [The board] is [composed
2-20 of three members] appointed by the governor with the advice and
2-21 consent of the senate.
2-22 (b) To be eligible for appointment as a conservator [to the
2-23 board], a person must be qualified, by experience or education, in
2-24 administration or fiscal management.
2-25 (c) A public officer is eligible to serve as a conservator
2-26 [on the board].
2-27 (d) A conservator's term expires on the earlier of the date
3-1 the conservatorship for which the conservator is appointed
3-2 dissolves or the second anniversary of the date of the
3-3 conservator's appointment. A conservator whose term expires before
3-4 the conservatorship is dissolved may be reappointed to continue the
3-5 conservatorship. [Members serve staggered six-year terms with the
3-6 term of one member expiring on January 31 of each odd-numbered
3-7 year.]
3-8 Sec. 2104.012. COMPENSATION OF CONSERVATOR [PRESIDING
3-9 OFFICER; MEETINGS]. (a) A conservator appointed to act as the
3-10 conservator of a state agency or public junior college under this
3-11 chapter is entitled to receive a salary for performing those duties
3-12 that is equal to the salary of the chief administrative officer of
3-13 the state agency or public junior college under conservatorship.
3-14 [The governor shall designate a board member to serve as presiding
3-15 officer for a two-year period expiring on January 31 of
3-16 odd-numbered years.]
3-17 (b) The state agency or public junior college under
3-18 conservatorship shall pay the salary of the conservator from money
3-19 appropriated or otherwise available to the state agency or public
3-20 junior college, except to the extent that money to pay the salary
3-21 is specifically appropriated or made available through the budget
3-22 execution process for that purpose. [The board shall meet at the
3-23 call of the presiding officer or as provided by board rule.]
3-24 Sec. 2104.013. [COMPENSATION;] EXPENSES OF CONSERVATOR. (a)
3-25 [A board member may not receive compensation but is entitled to
3-26 reimbursement for actual and necessary expenses incurred in the
3-27 performance of official duties.] A limit provided by appropriation
4-1 on the amount of reimbursement that state officers or members of
4-2 state boards and commissions may generally receive does not apply
4-3 to reimbursement of the reasonable and necessary expenses incurred
4-4 by a conservator in the course of performing duties under this
4-5 chapter [members of the State Conservatorship Board].
4-6 (b) The reasonable and necessary expenses incurred by a
4-7 conservator in the course of performing duties under this chapter
4-8 [If funds for the purpose of this chapter are not appropriated to
4-9 the board, the expenses of the board] shall be paid from funds
4-10 appropriated or otherwise available to the agency or public junior
4-11 college under conservatorship, except to the extent that money to
4-12 pay those expenses is specifically appropriated or made available
4-13 through the budget execution process for that purpose.
4-14 Sec. 2104.014. RULES. A conservator [The board] may adopt
4-15 and enforce rules necessary to administer the conservatorship for
4-16 which the conservator is appointed under this chapter. A
4-17 conservator may adopt initial rules on an emergency basis for the
4-18 period prescribed by Section 2001.034 if the conservator determines
4-19 that rules with immediate effect are necessary to ameliorate the
4-20 effect of the gross fiscal mismanagement.
4-21 Sec. 2104.015. ADMINISTRATIVE SERVICES. (a) The governor
4-22 shall provide a conservator [the board] with administrative
4-23 services.
4-24 (b) If necessary, the governor may use appropriations made
4-25 under Section 403.075 to provide the administrative services.
4-26 (Sections 2104.016-2104.020 reserved for expansion)
4-27 SUBCHAPTER C. CONSERVATORSHIP OF STATE
5-1 AGENCIES
5-2 Sec. 2104.021. MISMANAGEMENT FINDING; RECOMMENDATION;
5-3 CONSERVATORSHIP ORDER. (a) The legislative audit committee, on
5-4 [shall notify the governor of the committee's] finding that a
5-5 condition of gross fiscal mismanagement exists in a state agency,
5-6 may:
5-7 (1) notify the governor of the finding and recommend
5-8 that the governor appoint a conservator for the agency; or
5-9 (2) recommend to the agency that it agree within a
5-10 specified time to enter into a rehabilitation plan in accordance
5-11 with Section 2104.0215.
5-12 (b) After receipt of a [the] notice under Subsection (a),
5-13 the governor by proclamation may appoint a conservator, in
5-14 accordance with the recommendation, [order the board] to act as
5-15 conservator of the agency.
5-16 Sec. 2104.0215. REHABILITATION PLAN IN LIEU OF
5-17 CONSERVATORSHIP. (a) A state agency that agrees to enter into a
5-18 rehabilitation plan shall engage the services of an independent
5-19 management consulting team approved by the governor and by the
5-20 presiding officer and assistant presiding officer of the
5-21 legislative audit committee. The independent management consulting
5-22 team may include the state auditor, one or more appropriate state
5-23 agencies, and private consultants.
5-24 (b) The state agency entering into the rehabilitation plan
5-25 shall pay the costs of the independent management consulting team's
5-26 services from money appropriated or otherwise available to the
5-27 agency, except to the extent that money to pay the costs is
6-1 specifically appropriated or made available through the budget
6-2 execution process for that purpose.
6-3 (c) The independent management consulting team shall assist
6-4 the state agency in developing its rehabilitation plan. The
6-5 rehabilitation plan must include specific performance goals and the
6-6 period in which the goals must be achieved. The plan must be
6-7 approved by the governing body of the agency and by the governor
6-8 and the legislative audit committee.
6-9 (d) If the state agency does not adopt the rehabilitation
6-10 plan within a reasonable time or if the state auditor determines
6-11 and informs the governor that the state agency is not making
6-12 sufficient progress in implementing its rehabilitation plan, the
6-13 governor may appoint a conservator for the agency under Section
6-14 2104.021.
6-15 Sec. 2104.022. ASSUMPTION OF POLICY FUNCTIONS. The
6-16 conservator appointed by [board, acting on an order of] the
6-17 governor under Section 2104.021[,] shall assume all the powers and
6-18 duties of the officers responsible for policy direction of the
6-19 state agency that is the subject of [to] the proclamation [order],
6-20 and those officers may not act unless authorized by the conservator
6-21 [board].
6-22 Sec. 2104.023. [BOARD] CONSERVATORSHIP POWERS AND DUTIES.
6-23 (a) The [board, acting as] conservator of a state agency under
6-24 this subchapter[,] shall ensure that the agency complies with state
6-25 fiscal management policies.
6-26 (b) The [board, acting as] conservator of a state agency
6-27 under this subchapter, may:
7-1 (1) terminate the employment of any employee whose
7-2 conduct the conservator [board] determines contributed to the
7-3 condition that caused the conservatorship;
7-4 (2) employ personnel for the agency;
7-5 (3) change the agency's organization or structure as
7-6 necessary to alleviate the conditions that caused the
7-7 conservatorship; and
7-8 (4) contract with persons for management or
7-9 administrative services necessary to effect the conservatorship.
7-10 (c) The conservator [board] may delegate any part of the
7-11 conservator's [its] powers or duties as conservator other than
7-12 [its] rulemaking authority to a person with whom the conservator
7-13 [it] contracts under Subsection (b)(4).
7-14 Sec. 2104.024. REPORT. (a) The conservator [board] shall
7-15 report on a conservatorship under this subchapter to the governor
7-16 and the legislative audit committee not later than the 60th day
7-17 after the date the governor orders the conservatorship and at the
7-18 end of each subsequent 60-day period until the conservatorship is
7-19 dissolved.
7-20 (b) The report must include a description of the measures
7-21 taken to ensure that the state agency complies with state fiscal
7-22 management policies and an estimate of the progress the conservator
7-23 [board] has made in attaining that goal.
7-24 Sec. 2104.025. DURATION OF CONSERVATORSHIP. A
7-25 conservatorship under this subchapter continues until the earlier
7-26 of:
7-27 (1) the governor's issuing of a proclamation declaring
8-1 that the condition of gross fiscal mismanagement in the state
8-2 agency no longer exists and that the conservatorship is dissolved;
8-3 or
8-4 (2) the legislative audit committee's finding and
8-5 certifying to the governor that the condition of gross fiscal
8-6 mismanagement in the agency no longer exists, in which case the
8-7 conservatorship is dissolved.
8-8 (Sections 2104.026-2104.030 reserved for expansion)
8-9 SUBCHAPTER D. CONSERVATORSHIP OF PUBLIC JUNIOR COLLEGES
8-10 Sec. 2104.031. MISMANAGEMENT FINDING; CONSERVATORSHIP ORDER.
8-11 (a) On the governor's request, the Texas Higher Education
8-12 Coordinating Board with the advice and assistance of the state
8-13 auditor shall determine if a condition of gross fiscal
8-14 mismanagement exists at a public junior college.
8-15 (b) If the coordinating board finds a condition of gross
8-16 fiscal mismanagement of a public junior college, the governor by
8-17 proclamation may appoint a [order the board to act as] conservator
8-18 for [of] the college.
8-19 (c) Except as otherwise provided by this subchapter, a
8-20 conservator [the board] shall act as conservator of a public
8-21 junior college in the manner provided by this chapter for
8-22 conservatorship of state agencies by a conservator [the board].
8-23 Sec. 2104.032. REPORTS. A conservator [The board] shall
8-24 file the reports relating to public junior colleges required by
8-25 Section 2104.024 with the Texas Higher Education Coordinating
8-26 Board.
8-27 Sec. 2104.033. DURATION OF CONSERVATORSHIP. A
9-1 conservatorship of a public junior college under this subchapter
9-2 continues until the earlier of:
9-3 (1) the governor's issuing of a proclamation declaring
9-4 that the condition of gross fiscal mismanagement no longer exists
9-5 and that the conservatorship is dissolved; or
9-6 (2) the Texas Higher Education Coordinating Board's
9-7 finding and certifying to the governor that the condition of gross
9-8 fiscal mismanagement no longer exists, in which case the
9-9 conservatorship is dissolved.
9-10 SECTION 2. (a) The State Conservatorship Board as
9-11 constituted on the effective date of this Act is abolished on the
9-12 effective date of this Act unless on that date a state agency or
9-13 public junior college is under the conservatorship of the board. If
9-14 on the effective date of this Act a state agency or public junior
9-15 college is under the conservatorship of the board, the board
9-16 continues in existence under the law in effect immediately before
9-17 the effective date of this Act, and the prior law is continued in
9-18 effect for that purpose. The board is abolished on the date the
9-19 conservatorship is dissolved.
9-20 (b) The changes in law made by this Act do not apply to an
9-21 ongoing conservatorship of a state agency or public junior college
9-22 on the effective date of this Act. A conservatorship that is
9-23 ongoing on the effective date of this Act is governed by the law in
9-24 effect immediately before the effective date of this Act until the
9-25 conservatorship is dissolved, and the prior law is continued in
9-26 effect for that purpose.
9-27 SECTION 3. The importance of this legislation and the
10-1 crowded condition of the calendars in both houses create an
10-2 emergency and an imperative public necessity that the
10-3 constitutional rule requiring bills to be read on three several
10-4 days in each house be suspended, and this rule is hereby suspended,
10-5 and that this Act take effect and be in force from and after its
10-6 passage, and it is so enacted.