By Uher H.B. No. 2736
75R8648 CAG-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the operation of a nonprofit state association of
1-3 counties and related entities.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter B, Chapter 81, Local Government Code,
1-6 is amended by adding Section 81.0265 to read as follows:
1-7 Sec. 81.0265. OVERSIGHT OF ASSOCIATION OF COUNTIES. (a) In
1-8 this section:
1-9 (1) "Association" means a nonprofit state association
1-10 of counties funded in whole or in part by fees or dues paid by a
1-11 county under Section 81.026.
1-12 (2) "Related entity" means any other person that:
1-13 (A) the association controls in any manner;
1-14 (B) operates out of the same offices or building
1-15 as the association;
1-16 (C) shares with the association any employee of
1-17 the association; or
1-18 (D) operates a program for the association,
1-19 including a risk pool or other insurance program.
1-20 (b) The commissioners court of a county may not spend money
1-21 for membership fees or dues under Section 81.026 unless the
1-22 association complies with the requirements of this section.
1-23 (c) An association and any related entity shall annually
1-24 file with the secretary of state a designation of the status of the
2-1 association or related entity, including whether the association or
2-2 entity performs any public function that entitles the association
2-3 or entity to the protection of any statute.
2-4 (d) Not later than the 10th day after the end of an
2-5 association's fiscal year, the association shall file a report of
2-6 the financial condition of the association and any related entity.
2-7 The governor may establish rules for the submission of the reports.
2-8 (e) If an association or a related entity intends to file a
2-9 suit against a county that is a member of the association or
2-10 entity, the association or entity shall, not later than the 30th
2-11 day before the date the suit is filed, give written notice of the
2-12 intention to file suit to:
2-13 (1) the governing board of the association or entity;
2-14 and
2-15 (2) the county.
2-16 (f) Not later than the 30th day before the date an
2-17 association or a related entity changes the terms of any bylaws or
2-18 terms of any contract with a county, the association or entity
2-19 shall give written notice to each county affected by the change.
2-20 (g) The governor shall adopt rules relating to the operation
2-21 and oversight of an association or a related entity. The governor
2-22 may adopt annual audit or reporting requirements for the
2-23 association or related entity.
2-24 (h) If an association or a related entity operates a risk
2-25 pool or an insurance program, the association or entity must comply
2-26 with the requirements of Section 172.006.
2-27 SECTION 2. Section 172.006(b), Local Government Code, is
3-1 amended to read as follows:
3-2 (b) A pool may be administered by a staff employed by the
3-3 pool, an entity created by the political subdivision or group of
3-4 political subdivisions participating in the pool, or a third party
3-5 administrator. The individual responsible for administration of
3-6 the pool, whether employed by the pool, an entity created by the
3-7 political subdivision or a group of political subdivisions
3-8 participating in the pool, or a third party administrator:
3-9 (1) must hold a bachelor's degree in a field relating
3-10 to insurance or finance or hold the professional designation of:
3-11 (A) Chartered Property Casualty Underwriter
3-12 granted by the American Institute for Property and Liability
3-13 Underwriters;
3-14 (B) Certified Insurance Counselor granted by the
3-15 Society of Certified Insurance Counselors; or
3-16 (C) Associate in Risk Management granted by the
3-17 Insurance Institute of America;
3-18 (2) must have at least 10 years experience in
3-19 administration of risk pools, commercial insurance, or risk
3-20 management; and
3-21 (3) during each calendar year, shall participate in a
3-22 minimum of 20 hours of continuing education that:
3-23 (A) is acceptable to the trustees of the risk
3-24 pool; and
3-25 (B) relates to professional insurance, risk
3-26 management, or administration of risk pools.
3-27 SECTION 3. (a) An individual responsible for administration
4-1 of a risk pool under Section 172.006, Local Government Code, is not
4-2 required to satisfy the requirements of Sections 172.006(b)(1) and
4-3 (2), Local Government Code, as added by this Act, before January 1,
4-4 1998, or the requirements of Section 172.006(b)(3), Local
4-5 Government Code, as added by this Act, before December 31, 1998.
4-6 (b) The change in law made by this Act to Section
4-7 172.006(b), Local Government Code, applies only to the
4-8 qualifications of an individual who is responsible for
4-9 administration of a risk pool under a contract entered into or
4-10 renewed on or after the effective date of this Act. The
4-11 qualifications of an individual who is responsible for
4-12 administration of a risk pool under a contract entered into or
4-13 renewed before the effective date of this Act are governed by the
4-14 law as it existed immediately before the effective date of this
4-15 Act, and that law is continued in effect for that purpose.
4-16 SECTION 4. (a) This Act takes effect September 1, 1997.
4-17 (b) The governor shall, not later than January 1, 1998,
4-18 establish a method for reviewing the financial records of a
4-19 nonprofit state association of counties under Section 81.0265,
4-20 Local Government Code, as added by this Act.
4-21 SECTION 5. The importance of this legislation and the
4-22 crowded condition of the calendars in both houses create an
4-23 emergency and an imperative public necessity that the
4-24 constitutional rule requiring bills to be read on three several
4-25 days in each house be suspended, and this rule is hereby suspended.