By Counts H.B. No. 3203
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the disposition of unclaimed funds by nonprofit
1-3 cooperative corporations.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter D, Chapter 74, Property Code, is
1-6 amended by adding Section 74.3013 to read as follows:
1-7 Sec. 74.3013. DELIVERY OF MONEY FOR RURAL SCHOLARSHIP AND
1-8 ECONOMIC DEVELOPMENT. (a) Notwithstanding and in addition to any
1-9 other provision of this chapter or other law, a nonprofit
1-10 cooperative corporation may deliver reported money to a scholarship
1-11 fund for rural students or to stimulate rural economic development
1-12 instead of delivering the money to the comptroller as prescribed in
1-13 Section 74.301.
1-14 (b) A nonprofit cooperative corporation may deliver the
1-15 money under this section only:
1-16 (1) to a scholarship fund established by one or more
1-17 nonprofit cooperative corporations in this state to enable students
1-18 from rural areas to attend college, technical school, or other
1-19 postsecondary educational institution; and
1-20 (2) to an economic development fund for the
1-21 stimulation and improvement of business and commercial activity for
1-22 economic development in rural communities.
1-23 (c) A nonprofit cooperative corporation shall file with the
1-24 comptroller a verification of money delivered under this section
2-1 that complies with Section 74.302.
2-2 (d) A claim for money delivered under this section must be
2-3 filed with the nonprofit cooperative corporation that delivered the
2-4 money. A nonprofit cooperative corporation shall forward the claim
2-5 to the administrator of the fund to which the money was delivered.
2-6 The fund shall pay the claim if the fund determines in good faith
2-7 that the claim is valid. A person aggrieved by a claim decision
2-8 may file a suit against the fund in a district court in the county
2-9 in which the administrator of the fund is located in accordance
2-10 with Section 74.506.
2-11 (e) The comptroller shall prescribe forms and procedures
2-12 governing this section, including forms and procedures relating to:
2-13 (1) notice of presumed abandoned property;
2-14 (2) delivery of reported money to a scholarship or
2-15 economic development fund;
2-16 (3) filing of a claim; and
2-17 (4) procedures to allow equitable opportunity for
2-18 participation by each nonprofit cooperative corporation in the
2-19 state.
2-20 (f) During a state fiscal year the total amount of money
2-21 that may be transferred by all nonprofit cooperative corporations
2-22 under this section may not exceed $1 million. No more than 20
2-23 percent of each nonprofit cooperative's funds eligible for delivery
2-24 under this section shall be used for economic development. The
2-25 comptroller shall adopt procedures to record the total amount of
2-26 money transferred annually to allow equitable opportunity for
2-27 participation with preference given to corporations already
3-1 providing similar scholarship opportunities in other states.
3-2 (g) Nonprofit cooperative corporations may combine economic
3-3 development funds from other sources with any economic development
3-4 funds delivered under this section. In addition, such cooperatives
3-5 may engage in other business and commercial activities, in their
3-6 own behalf or through such subsidiaries and affiliates as deemed
3-7 necessary, in order to provide and promote educational
3-8 opportunities and to stimulate rural economic development.
3-9 (h) In this section, a nonprofit cooperative corporation
3-10 means a cooperative corporation organized under Chapters 51 and 52,
3-11 Agriculture Code, the Texas Non-Profit Corporation Act (Article
3-12 1396-1.01 et seq., Vernon's Texas Civil Statutes), the Cooperative
3-13 Association Act (Article 1396-50.01, Vernon's Texas Civil
3-14 Statutes), and the Electric Cooperative Corporation Act (Article
3-15 1528b, Vernon's Texas Civil Statutes).
3-16 SECTION 2. Subsection (a), Section 51.004, Agriculture Code,
3-17 is amended to read as follows:
3-18 (a) A society may:
3-19 (1) borrow money and discount notes, not to exceed a
3-20 total amount equal to five times its working capital;
3-21 (2) lend money to its members, on terms and with
3-22 security as provided by its bylaws;
3-23 (3) act as an agent for its members in selling the
3-24 members' agricultural products and in purchasing machinery and
3-25 supplies for its members, including fire, livestock, hail, cyclone,
3-26 and storm insurance;
3-27 (4) own and operate machinery and tools necessary to
4-1 produce, harvest and prepare for market farm and ranch products;
4-2 [and]
4-3 (5) exercise any of the powers granted to cooperative
4-4 marketing associations under Section 52.013 of this code; and
4-5 (6) deliver money to a scholarship fund for rural
4-6 students.
4-7 SECTION 3. Section 52.013, Agriculture Code, is amended to
4-8 read as follows:
4-9 Sec. 52.013. General Powers. A marketing association may:
4-10 (1) engage in any activity connected with:
4-11 (A) the production, cultivation, and care of
4-12 citrus groves;
4-13 (B) the marketing, selling, harvesting,
4-14 preserving, drying, processing, canning, packing, storing,
4-15 handling, or use of any agricultural products produced or delivered
4-16 to it by its members;
4-17 (C) the production, manufacturing, or marketing
4-18 of the by-products of those agricultural products;
4-19 (D) the purchase, hiring, or use by its members
4-20 of supplies, machinery, or equipment; and
4-21 (E) the financing of an activity enumerated by
4-22 Paragraphs (A) through (D) of this subdivision;
4-23 (2) borrow money and make advances to its members;
4-24 (3) act as an agent or representative of any member in
4-25 an activity authorized by Subdivision (1) or (2) of this section;
4-26 (4) acquire, hold, own, exercise all rights of
4-27 ownership in, sell, transfer, or pledge shares of capital stocks or
5-1 bonds of a corporation or association, including a bank for
5-2 cooperatives organized under the Farm Credit Act of 1933, engaged
5-3 in an activity related to that of the association incorporated
5-4 under this chapter or engaged in the handling or marketing of a
5-5 product handled by the association;
5-6 (5) establish reserves and invest the money in those
5-7 reserves in bonds or other property as provided by the
5-8 association's bylaws;
5-9 (6) buy, hold, and exercise all privileges of
5-10 ownership over real or personal property that is determined by the
5-11 association to be necessary or convenient for, or incidental to,
5-12 conducting and operating its business;
5-13 (7) perform, in or outside this state, acts that are
5-14 necessary, suitable, or proper to accomplish the purposes and
5-15 objectives permitted by this section or that are conducive to or
5-16 expedient for the interest or benefit of the association, and may
5-17 contract for the performance of those acts;
5-18 (8) possess and exercise, in or outside this state,
5-19 all powers, rights, and privileges necessary for or incidental to
5-20 the purposes for which the association is organized or the
5-21 activities in which it is engaged; [and]
5-22 (9) exercise the rights, powers, and privileges that
5-23 are granted by the laws of the state to general corporations and
5-24 that are not inconsistent with this chapter; and
5-25 (10) deliver money to a scholarship fund for rural
5-26 students.
5-27 SECTION 4. Section 4, Electric Cooperative Corporation Act
6-1 (Article 1528b, Vernon's Texas Civil Statutes), is amended to read
6-2 as follows:
6-3 Sec. 4. Powers of Corporation. Each corporation shall have
6-4 power:
6-5 (1) To sue and be sued, complain and defend, in its
6-6 corporate name;
6-7 (2) To have perpetual succession unless a limited
6-8 period of duration is stated in its articles of incorporation;
6-9 (3) To adopt a corporate seal which may be altered at
6-10 pleasure, and to use it, or a facsimile thereof, as required by
6-11 law;
6-12 (4) To generate, manufacture, purchase, acquire, and
6-13 accumulate electric energy and to transmit, distribute, sell,
6-14 furnish, and dispose of such electric energy to its members only,
6-15 and to construct, erect, purchase, lease as lessee and in any
6-16 manner acquire, own, hold, maintain, operate, sell, dispose of,
6-17 lease as lessor, exchange, and mortgage plants, buildings, works,
6-18 machinery, supplies, equipment, apparatus, and transmission and
6-19 distribution lines or systems necessary, convenient, or useful;
6-20 (5) To assist its members only to wire their premises
6-21 and install therein electrical and plumbing fixtures, machinery,
6-22 supplies, apparatus, and equipment of any and all kinds and
6-23 character, and in connection therewith and for such purposes, to
6-24 purchase, acquire, lease, sell, distribute, install, and repair
6-25 electrical and plumbing fixtures, machinery, supplies, apparatus,
6-26 and equipment of any and all kinds and character and to receive,
6-27 acquire, endorse, pledge, hypothecate, and dispose of notes, bonds,
7-1 and other evidences of indebtedness;
7-2 (6) To furnish to other corporations organized under
7-3 this Act, or to the members thereof, electric energy, wiring
7-4 facilities, electrical and plumbing equipment, and services
7-5 convenient or useful;
7-6 (7) To acquire, own, hold, use, exercise, and, to the
7-7 extent permitted by law, to sell, mortgage, pledge, hypothecate,
7-8 and in any manner dispose of franchises, rights, privileges,
7-9 licenses, rights of way, and easements necessary, useful, or
7-10 appropriate;
7-11 (8) To purchase, receive, lease as lessee, or in any
7-12 other manner acquire, own, hold, maintain, sell, exchange, and use
7-13 any and all real and personal property or any interest therein;
7-14 (9) To borrow money and otherwise contract
7-15 indebtedness, to issue its obligations therefor, and to secure the
7-16 payment thereof by mortgage, pledge, or deed of trust of all or any
7-17 of its property, assets, franchises, revenues, or income;
7-18 (10) To sell and convey, mortgage, pledge, lease as
7-19 lessor, and otherwise dispose of all or any part of its property
7-20 and assets;
7-21 (11) To have and exercise the power of eminent domain
7-22 for the purpose and in the manner provided by the condemnation laws
7-23 of this State for acquiring private property for public use, such
7-24 right to be paramount except as to property of the State, or of any
7-25 political subdivision thereof;
7-26 (12) To accept gifts or grants of money, services, or
7-27 property, real or personal;
8-1 (13) To make any and all contracts necessary or
8-2 convenient for the exercise of the powers granted in this Act;
8-3 (14) To fix, regulate, and collect rates, fees, rents,
8-4 or other charges for electric energy and any other facilities,
8-5 supplies, equipment, or services furnished by the corporation;
8-6 (15) To conduct its business, and have offices within
8-7 or without this State;
8-8 (16) To elect or appoint officers, agents, and
8-9 employees of the corporation, and to define their duties and fix
8-10 their compensation;
8-11 (17) To make and alter by-laws, not inconsistent with
8-12 the articles of incorporation or with the laws of this State for
8-13 the administration and regulation of the affairs of the
8-14 corporation;
8-15 (18) To do and perform, either for itself or its
8-16 members, or for any other corporation organized under this Act, or
8-17 for the members thereof, any and all acts and things, and to have
8-18 and exercise any and all powers as may be necessary, convenient, or
8-19 appropriate to effectuate the purpose for which the corporation is
8-20 organized[;], including such other or additional purpose or
8-21 purposes as may be engaged in by a corporation organized under
8-22 Article 2.01, Texas Non-Profit Corporation Act (Article 1396-2.01,
8-23 Vernon's Texas Civil Statutes).
8-24 SECTION 5. Section A, Article 2.02, Texas Non-Profit
8-25 Corporation Act (Article 1396-2.02, Vernon's Texas Civil Statutes),
8-26 is amended to read as follows:
8-27 A. Subject to the provisions of Sections B and C of this
9-1 Article, each corporation shall have power:
9-2 (1) To have perpetual succession by its corporate
9-3 name, unless a limited period of duration is stated in its articles
9-4 of incorporation. Notwithstanding the articles of incorporation,
9-5 the period of duration for any corporation incorporated before
9-6 August 10, 1959, is perpetual if all fees and franchise taxes have
9-7 been paid as provided by law.
9-8 (2) To sue and be sued, complain and defend, in its
9-9 corporate name.
9-10 (3) To have a corporate seal which may be altered at
9-11 pleasure, and to use the same by causing it, or a facsimile
9-12 thereof, to be impressed on, affixed to, or in any manner
9-13 reproduced upon, instruments of any nature required to be executed
9-14 by its proper officers.
9-15 (4) To purchase, receive, lease, or otherwise acquire,
9-16 own, hold, improve, use, or otherwise deal in and with, real or
9-17 personal property, or any interest therein, wherever situated, as
9-18 the purposes of the corporation shall require, or as shall be
9-19 donated to it.
9-20 (5) To sell, convey, mortgage, pledge, lease,
9-21 exchange, transfer, and otherwise dispose of all or any part of its
9-22 property and assets.
9-23 (6) To lend money to and otherwise assist its
9-24 employees and officers, but not its directors, if the loan or
9-25 assistance may reasonably be expected to benefit, directly or
9-26 indirectly, the corporation providing the assistance. Loans made
9-27 to officers must be:
10-1 (a) made for the purpose of financing the
10-2 principal residence of the officer; or
10-3 (b) made during the first year of that officer's
10-4 employment, in which case the original principal amount may not
10-5 exceed 100 percent of the officer's annual salary; or
10-6 (c) made in any subsequent year, in which case
10-7 the original principal amount may not exceed 50 percent of the
10-8 officer's annual salary.
10-9 (7) To purchase, receive, subscribe for, or otherwise
10-10 acquire, own, hold, vote, use, employ, mortgage, lend, pledge, sell
10-11 or otherwise dispose of, and otherwise use and deal in and with,
10-12 shares or other interests in, or obligations of, other domestic or
10-13 foreign corporations, whether for profit or not for profit,
10-14 associations, partnerships, or individuals, or direct or indirect
10-15 obligations of the United States or of any other government, state,
10-16 territory, government district, or municipality, or of any
10-17 instrumentality thereof.
10-18 (8) To make contracts and incur liabilities, borrow
10-19 money at such rates of interest as the corporation may determine,
10-20 issue its notes, bonds, and other obligations, and secure any of
10-21 its obligations by mortgage or pledge of all or any of its
10-22 property, franchises, and income.
10-23 (9) To lend money for its corporate purposes, invest
10-24 and reinvest its funds, and take and hold real and personal
10-25 property as security for the payment of funds so loaned or
10-26 invested.
10-27 (10) To conduct its affairs, carry on its operations,
11-1 and have officers and exercise the powers granted by this Act in
11-2 any state, territory, district, or possession of the United States,
11-3 or any foreign country.
11-4 (11) To elect or appoint officers and agents of the
11-5 corporation for such period of time as the corporation may
11-6 determine and define their duties and fix their compensation.
11-7 (12) To make and alter by-laws, not inconsistent with
11-8 its articles of incorporation or with the laws of this State, for
11-9 the administration and regulation of the affairs of the
11-10 corporation.
11-11 (13) To make donations for the public welfare or for
11-12 charitable, scientific, or educational purposes and in time of war
11-13 to make donations in aid of war activities.
11-14 (14) To cease its corporate activities and terminate
11-15 its existence by voluntary dissolution.
11-16 (15) Whether included in the foregoing or not, to have
11-17 and exercise all powers necessary or appropriate to effect any or
11-18 all of the purposes for which the corporation is organized.
11-19 (16) Any religious, charitable, educational, or
11-20 eleemosynary institution organized under the laws of this State may
11-21 acquire, own, hold, mortgage, and dispose of and invest its funds
11-22 in real and personal property for the use and benefit and under the
11-23 discretion of, and in trust for any convention, conference or
11-24 association organized under the laws of this State or another state
11-25 with which it is affiliated, or which elects its board of
11-26 directors, or which controls it, in furtherance of the purposes of
11-27 the member institution.
12-1 (17) To pay pensions and establish pension plans and
12-2 pension trusts for all of, or class, or classes of its officer and
12-3 employees, or its officers or its employees.
12-4 (18) To deliver money to a scholarship fund for rural
12-5 students.
12-6 SECTION 6. Section 6, Cooperative Association Act (Article
12-7 1396-50.01, Vernon's Texas Civil Statutes), is amended to read as
12-8 follows:
12-9 Sec. 6. Powers. An association may exercise all the powers
12-10 granted to a nonprofit corporation under Article 2.02, Texas
12-11 Non-Profit Corporation Act and may:
12-12 (1) own and hold membership in and share capital of
12-13 other associations or corporations, and own and exercise ownership
12-14 rights in bonds or other obligations;
12-15 (2) make agreements of mutual aid or federation with
12-16 other associations, other groups organized on a cooperative basis,
12-17 and other nonprofit groups;
12-18 (3) exercise all powers not inconsistent with this Act
12-19 that are necessary or convenient for the accomplishment of its
12-20 purposes, and to that end the enumeration of powers in this section
12-21 is not exclusive; [and]
12-22 (4) not engage, either directly or indirectly, in
12-23 insurance companies of every type or character as the insurance
12-24 business is defined and regulated by the Insurance Code, as
12-25 amended, health maintenance organizations, or prepaid legal service
12-26 corporations; and
12-27 (5) deliver money to a scholarship fund for rural
13-1 students.
13-2 SECTION 7. This Act takes effect September 1, 1997.
13-3 SECTION 8. The importance of this legislation and the
13-4 crowded condition of the calendars in both houses create an
13-5 emergency and an imperative public necessity that the
13-6 constitutional rule requiring bills to be read on three several
13-7 days in each house be suspended, and this rule is hereby suspended.