By Brown                                         S.B. No. 358

      75R1793 DWS-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the continuation and functions of the Credit Union

 1-3     Commission.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Section 2.03, Texas Credit Union Act (Article

 1-6     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

 1-7     read as follows:

 1-8           Sec. 2.03.  INCORPORATION PROCEDURE.  (a)  The incorporators

 1-9     shall file with the commissioner:

1-10                 (1)  the original articles of incorporation in

1-11     duplicate;

1-12                 (2)  standard bylaws for the general operation of the

1-13     credit union in duplicate;

1-14                 (3)  a completed application in a form prescribed by

1-15     the commission;  and

1-16                 (4)  the fees required and set by the commission.

1-17           (b)  The commissioner may conduct any investigation and

1-18     obtain any information or report from any person, including a law

1-19     enforcement agency, that the commissioner considers necessary.

1-20           (c)  [The commission shall adopt rules establishing

1-21     procedures concerning notice of applications to incorporate and

1-22     conditions under which a hearing may be available.]

1-23           [(d)]  The commissioner shall approve the application for

1-24     incorporation if the incorporators have complied with this Act and

 2-1     the rules adopted under this Act and the commissioner finds from

 2-2     the information furnished with the application, the results of any

 2-3     investigation, the evidence submitted at any hearing, and the

 2-4     information in the official records in the department that:

 2-5                 (1)  the character and general fitness of the

 2-6     incorporators and the members of the initial board of directors

 2-7     warrant belief that the business and affairs of the credit union

 2-8     will be properly administered in accordance with this Act and the

 2-9     rules adopted under this Act;

2-10                 (2)  the character and size of the field of membership

2-11     proposed to be served by the credit union conforms with this Act

2-12     and the rules adopted under this Act and are favorable to the

2-13     economic viability of the credit union;  and

2-14                 (3)  the incorporators and the members of the initial

2-15     board of directors are acting in good faith and are making the

2-16     application in accordance with the purposes of this Act.

2-17           (d) [(e)]  In addition to the findings under Subsection (c)

2-18     [(d)] of this section, the commissioner shall, in accordance with

2-19     rules the commission may adopt, consider the effect of overlapping

2-20     fields of membership on the applicant credit union and existing

2-21     state or federal credit unions doing business in this state, and

2-22     the commissioner may, as a condition of approval of the

2-23     application, require the applicant credit union to limit or

2-24     eliminate overlaps, in accordance with the rules, if any, in order

2-25     to achieve the purposes of this Act and promote the welfare and

2-26     stability of those credit unions.  The commissioner also may

2-27     consider the availability and adequacy of financial services in the

 3-1     local community and the effect that the incorporation of the credit

 3-2     union would have on the local community.

 3-3           (e)  The [(f)  Not later than 90 days after the later of the

 3-4     date on which an application is filed or the date on which a

 3-5     hearing on the application is held, the] commissioner shall state

 3-6     his findings in a written order that approves or denies the

 3-7     application to incorporate.

 3-8           (f) [(g)]  The commission shall adopt rules providing for

 3-9     appeal by an incorporator or aggrieved person.  The commissioner's

3-10     order may be appealed to the commission not later than 60 days

3-11     after the date of the order.  The commission shall, by written

3-12     order, affirm or reverse the decision of the commissioner after

3-13     reviewing the information or evidence it considers necessary or

3-14     relevant.

3-15           (g) [(h)]  An order of the commissioner or commission shall

3-16     be promptly mailed to the incorporators by registered or certified

3-17     mail.  If the application is approved by the commissioner, in the

3-18     absence of an appeal, or by the commission after conclusion of an

3-19     appeal, the commissioner shall issue a certificate of

3-20     incorporation, deliver copies of the approved articles of

3-21     incorporation and bylaws to the incorporators, and retain copies of

3-22     these documents in the department's permanent files.

3-23           SECTION 2.  Section 2.06(b), Texas Credit Union Act (Article

3-24     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

3-25     read as follows:

3-26           (b)  The board of directors may amend the articles of

3-27     incorporation or bylaws and shall submit amendments to the

 4-1     commissioner.  The commissioner shall approve or disapprove an

 4-2     amendment in writing [not later than 60 days after the date of

 4-3     submission, the date of any required publication in the

 4-4     department's newsletter, or the date on which a hearing on the

 4-5     amendment is held, whichever is later].  In approving an amendment,

 4-6     the commissioner shall make the findings and may take the actions

 4-7     provided by Subsections (c) and (d) [and (e)] of Section 2.03 of

 4-8     this Act. The commissioner may not approve an amendment if the

 4-9     commissioner finds that it violates this Act or the rules adopted

4-10     under this Act. The commissioner shall state the reasons for a

4-11     disapproval with reasonable specificity.  Amendments become

4-12     effective on approval by the commissioner.

4-13           SECTION 3.  Section 10.03, Texas Credit Union Act (Article

4-14     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

4-15     adding Subsections (g) and (h) to read as follows:

4-16           (g)  In determining whether to approve or disapprove the

4-17     merger or consolidation, the commissioner shall consider the

4-18     availability and adequacy of financial services in the local

4-19     community and the effect that the merger or consolidation would

4-20     have on the local community.  The commission by rule shall

4-21     establish other appropriate criteria that the commissioner must

4-22     consider in making the determination.

4-23           (h)  The rules adopted under this section must specify in

4-24     detail the procedures that:

4-25                 (1)  a credit union must follow to obtain commissioner

4-26     approval of a merger or consolidation; and

4-27                 (2)  the commissioner must follow in approving or

 5-1     disapproving the merger or consolidation.

 5-2           SECTION 4.  Sections 11.01(b) and (c), Texas Credit Union Act

 5-3     (Article 2461-1.01 et seq., Vernon's Texas Civil Statutes), are

 5-4     amended to read as follows:

 5-5           (b)  The Credit Union Department is composed of the Credit

 5-6     Union Commission and a Credit Union Commissioner, together with

 5-7     other officers and employees within the department.  The department

 5-8     shall supervise and shall regulate, as provided in this Act, all

 5-9     credit unions organized under the laws of the State of Texas.  The

5-10     department shall periodically make comprehensive studies of the

5-11     statutes of this state as they pertain to credit union operations.

5-12     The commissioner shall report the recommendations of the department

5-13     when and as necessary to the legislature for consideration. The

5-14     [During January of each year, the] department shall prepare

5-15     annually [file with the governor and the presiding officer of each

5-16     house of the legislature] a complete and detailed written report

5-17     accounting for all funds received and disbursed by the department

5-18     during the preceding year.  The annual report must meet the

5-19     reporting requirements applicable to financial reporting provided

5-20     in the General Appropriations Act.  The financial transactions of

5-21     the department are subject to audit by the state auditor in

5-22     accordance with Chapter 321, Government Code.

5-23           (c)  The Credit Union Commission is subject to Chapter 325,

5-24     Government Code (Texas Sunset Act).  Unless continued in existence

5-25     as provided by that chapter, the commission is abolished and this

5-26     Act expires September 1, 2001 [1997].

5-27           SECTION 5.  Section 11.02, Texas Credit Union Act (Article

 6-1     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

 6-2     read as follows:

 6-3           Sec. 11.02.  ELIGIBILITY OF MEMBERS.  (a)  Four [Six] members

 6-4     of the commission must be individuals who are currently engaged in

 6-5     the exercise of the duties, responsibilities, rights, and powers of

 6-6     a duly authorized director, officer, or committee member of a

 6-7     credit union that is organized and doing business in this state

 6-8     under this Act or the Federal Credit Union Act and that has its

 6-9     principal office in this state, and who have five years or more of

6-10     active experience as such a director, officer, or committee member.

6-11     No more than one person from a federal credit union may serve on

6-12     the commission at any time. Experience as a commissioner, deputy

6-13     commissioner, or examiner is equivalent to the type of experience

6-14     required by this subsection.  If a person holding a position in

6-15     accordance with this subsection ceases to be engaged in the

6-16     exercise of the duties, responsibilities, rights, and powers

6-17     prescribed by this subsection for a period exceeding 90 days, the

6-18     person is ineligible to serve as a member and the person's position

6-19     on the commission is vacant.

6-20           (b)  Five [Three] members of the commission are

6-21     representatives of the general public.  A person is not eligible

6-22     for appointment as a public member of [An individual appointed to

6-23     serve in that capacity may not, at the time of the individual's

6-24     appointment to or while serving on] the commission if the person or

6-25     the person's spouse:

6-26                 (1)  is employed by or participates [be engaged] in the

6-27     management or direction of a financial institution or other

 7-1     organization regulated by the department or receiving funds from

 7-2     the department [, such as a credit union, bank, or savings and loan

 7-3     association]; [or]

 7-4                 (2)  has [have], other than as a member or customer, a

 7-5     financial interest in a financial institution or other organization

 7-6     regulated by the department or receiving funds from the department;

 7-7     or

 7-8                 (3)  uses or receives a substantial amount of tangible

 7-9     goods, services, or funds from the department, other than

7-10     compensation or reimbursement authorized by law for commission

7-11     membership, attendance, or expenses[, such as a credit union, bank,

7-12     or savings and loan association].

7-13           (c)  No two members of the commission may be residents of the

7-14     same state senatorial district.

7-15           (d)  An officer, employee, or paid consultant of a Texas [A

7-16     person currently serving as chairman, first vice-chairman,

7-17     president, vice-president, secretary, or treasurer of a state]

7-18     trade association in the credit union industry[, or an employee of

7-19     such an organization,] may not serve as a member of the commission

7-20     and may not be an employee of the department who is exempt from the

7-21     state's position classification plan or is compensated at or above

7-22     the amount prescribed by the General Appropriations Act for step 1,

7-23     salary group 17, of the position classification salary schedule.

7-24           (e)  A person who is the spouse of an officer, manager, or

7-25     paid consultant of a Texas trade association in the credit union

7-26     industry may not be a member of the commission and may not be an

7-27     employee of the department who is exempt from the state's position

 8-1     classification plan or is compensated at or above the amount

 8-2     prescribed by the General Appropriations Act for step 1, salary

 8-3     group 17, of the position classification salary schedule.

 8-4           (f)  For the purposes of this section, a Texas trade

 8-5     association is a nonprofit, cooperative, and voluntarily joined

 8-6     association of business or professional competitors in this state

 8-7     designed to assist its members and its industry or profession in

 8-8     dealing with mutual business or professional problems and in

 8-9     promoting their common interest.

8-10           (g) [(e)] A person may not serve as a member of the

8-11     commission or act as the general counsel to the commission or the

8-12     department if the person [who] is required to register as a

8-13     lobbyist under Chapter 305, Government Code, because of the

8-14     person's activities for compensation on behalf of a profession

8-15     related to the operation of [may not serve as a member of the

8-16     commission or act as the general counsel to] the commission.

8-17           SECTION 6.  Section 11.03(a), Texas Credit Union Act (Article

8-18     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

8-19     read as follows:

8-20           (a)  The members of the commission are appointed, without

8-21     regard to race, color, creed, disability, sex, religion, age, or

8-22     national origin, by the governor, with the advice and consent of

8-23     the senate, for terms of six years, with the terms of three members

8-24     expiring February 15 of each odd-numbered year.  The governor shall

8-25     appoint the members who are representatives of the general public

8-26     on the basis of recognized business ability.

8-27           SECTION 7.  Chapter 11, Texas Credit Union Act (Article

 9-1     2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

 9-2     adding Section 11.031 to read as follows:

 9-3           Sec. 11.031.  TRAINING PROGRAM.  (a)  Before a member of the

 9-4     commission may assume the member's duties and before the member may

 9-5     be confirmed by the senate, the member must complete at least one

 9-6     course of the training program established under this section.

 9-7           (b)  A training program established under this section shall

 9-8     provide information to the member regarding:

 9-9                 (1)  the enabling legislation that created the

9-10     department and its policy-making body to which the member is

9-11     appointed to serve;

9-12                 (2)  the programs operated by the department;

9-13                 (3)  the role and functions of the department;

9-14                 (4)  the rules of the commission with an emphasis on

9-15     the rules that relate to disciplinary and investigatory authority;

9-16                 (5)  the current budget for the department;

9-17                 (6)  the results of the most recent formal audit of the

9-18     department;

9-19                 (7)  the requirements of the:

9-20                       (A)  open meetings law, Chapter 551, Government

9-21     Code;

9-22                       (B)  open records law, Chapter 552, Government

9-23     Code; and

9-24                       (C)  administrative procedure law, Chapter 2001,

9-25     Government Code;

9-26                 (8)  the requirements of the conflict of interest laws

9-27     and other laws relating to public officials; and

 10-1                (9)  any applicable ethics policies adopted by the

 10-2    department or the Texas Ethics Commission.

 10-3          SECTION 8.  Section 11.04, Texas Credit Union Act (Article

 10-4    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

 10-5    read as follows:

 10-6          Sec. 11.04.  VACANCIES; REMOVAL.  (a)  The office of a member

 10-7    of the commission becomes vacant on January 1 if the member failed

 10-8    to attend more than one-half of the meetings of the commission held

 10-9    during the preceding calendar year, excluding any meetings held

10-10    before the member assumed office.

10-11          (b)  The governor may remove a member from the member's

10-12    position on the commission for neglect of duty, incompetence, or

10-13    fraudulent or criminal conduct.

10-14          (c)  It is grounds for removal from the commission if a

10-15    member:

10-16                (1)  does not have at the time of appointment the

10-17    qualifications required by Section 11.02;

10-18                (2)  does not maintain during service on the commission

10-19    the qualifications required by Section 11.02;

10-20                (3)  violates a prohibition established by Section

10-21    11.02;

10-22                (4)  cannot because of illness or disability discharge

10-23    the member's duties for a substantial part of the term for which

10-24    the member is appointed; or

10-25                (5)  is absent from more than half of the regularly

10-26    scheduled commission meetings that the member is eligible to attend

10-27    during a calendar year unless the absence is excused by majority

 11-1    vote of the commission.

 11-2          (d)  The validity of an action of the commission is not

 11-3    affected by the fact that it is taken when a ground for removal of

 11-4    a commission member exists.

 11-5          (e)  If the commissioner has knowledge that a potential

 11-6    ground for removal exists, the commissioner shall notify the

 11-7    presiding officer of the commission of the potential ground.  The

 11-8    presiding officer shall then notify the governor and the attorney

 11-9    general that a potential ground for removal exists.  If the

11-10    potential ground for removal involves the presiding officer, the

11-11    commissioner shall notify the next highest officer of the

11-12    commission, who shall notify the governor and the attorney general

11-13    that a potential ground for removal exists [violates a prohibition

11-14    established by Section 11.02(e) of this Act].

11-15          (f) [(d)]  The office of a member of the commission is vacant

11-16    in the event of the death, resignation, or removal of the member,

11-17    or if the member ceases to have the qualifications necessary to

11-18    serve as a member.

11-19          (g) [(e)]  In the event of a vacancy on the commission for

11-20    any cause, the governor, with the advice and consent of the senate,

11-21    shall promptly appoint a qualified person to fill the unexpired

11-22    term.

11-23          [(f)  The validity of an action of the commission is not

11-24    affected by the fact that it was taken when a ground for removal of

11-25    a member of the commission existed.]

11-26          SECTION 9.  Sections 11.06(a), (c), and (e), Texas Credit

11-27    Union Act (Article 2461-1.01 et seq., Vernon's Texas Civil

 12-1    Statutes), are amended to read as follows:

 12-2          (a)  The commission shall hold regular meetings at least

 12-3    twice each year.  The chairman of the commission, the commissioner,

 12-4    or any five members of the commission may call special meetings.

 12-5    The commission shall adopt reasonable rules governing the time and

 12-6    place of meetings and the conduct of all meetings, including the

 12-7    form in which minutes of the meetings are maintained.  The [All

 12-8    meetings of the] commission is [are] subject to the Open Meetings

 12-9    Law, Chapter 551, Government Code, and the administrative procedure

12-10    law, Chapter 2001, Government Code [271, Acts of the 60th

12-11    Legislature, 1967, as amended (Article 6252-17, Vernon's Texas

12-12    Civil Statutes)].

12-13          (c)  The governor shall designate a member of the commission

12-14    as presiding officer of the commission to serve in that capacity at

12-15    the pleasure of the governor [commission shall annually elect a

12-16    chairman and vice-chairman from among its members.  The chairman

12-17    shall preside at all meetings of the commission, and the

12-18    vice-chairman shall preside in the absence of the chairman.  If

12-19    both the chairman and vice-chairman are absent from a meeting, the

12-20    most senior member of the commission in attendance at the meeting

12-21    shall serve as acting chairman].

12-22          (e)  No commission member may act on matters under

12-23    consideration which directly affect [and specifically relate to]

12-24    any credit union of which the member of the commission is an

12-25    officer, director, or member.  The commission shall adopt rules

12-26    relating to recusal of members, requiring that a member who has a

12-27    personal or private interest in a measure, proposal, or decision

 13-1    pending before the commission shall publicly disclose the fact to

 13-2    the commission at a meeting held in compliance with Chapter 551,

 13-3    Government Code.  The member may not vote or otherwise participate

 13-4    in the decision.  The disclosure shall be entered into the minutes

 13-5    of the meeting.

 13-6          SECTION 10.  Chapter 11, Texas Credit Union Act (Article

 13-7    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

 13-8    adding Section 11.061 to read as follows:

 13-9          Sec. 11.061.  RECEIPT OF PUBLIC COMMENTS; NOTICE OF

13-10    COMMISSION ACTIVITIES.  (a)  The commission shall develop and

13-11    implement policies that provide the public with a reasonable

13-12    opportunity to appear before the commission and to speak on any

13-13    issue under the jurisdiction of the department.

13-14          (b)  The commission shall adopt rules providing for public

13-15    notice of department activities.

13-16          SECTION 11.  Section 11.07, Texas Credit Union Act (Article

13-17    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

13-18    adding Subsections (d) and (e) to read as follows:

13-19          (d)  The commission may not adopt rules restricting

13-20    competitive bidding or advertising by a credit union except to

13-21    prohibit false, misleading, or deceptive practices.

13-22          (e)  In its rules to prohibit false, misleading, or deceptive

13-23    practices, the commission may not include a rule that:

13-24                (1)  restricts the use of any medium for advertising;

13-25                (2)  relates to the size or duration of an

13-26    advertisement by the credit union; or

13-27                (3)  restricts the credit union's advertisement under a

 14-1    trade name.

 14-2          SECTION 12.  Chapter 11, Texas Credit Union Act (Article

 14-3    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

 14-4    adding Section 11.071 to read as follows:

 14-5          Sec. 11.071.  SEPARATION OF RESPONSIBILITIES.  The commission

 14-6    shall develop and implement policies that clearly separate the

 14-7    policy-making responsibilities of the commission and the management

 14-8    responsibilities of the commissioner and the staff of the

 14-9    department.

14-10          SECTION 13.  Section 11.10, Texas Credit Union Act (Article

14-11    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

14-12    read as follows:

14-13          Sec. 11.10.  POWERS OF CREDIT UNION COMMISSIONER.  (a)  On

14-14    the appointment and qualification of a commissioner, the

14-15    commissioner shall supervise and regulate all credit unions doing

14-16    business in this state, except federal credit unions organized and

14-17    existing under federal law, in accordance with this Act and the

14-18    rules and regulations promulgated under this Act.

14-19          (b)  The commissioner shall enforce the provisions of this

14-20    Act and the rules and regulations promulgated from time to time.

14-21          (c)  The commissioner shall levy and collect all supervision

14-22    fees, charges, and revenues required to be paid by credit unions as

14-23    provided by Subsection (c), Section 11.07, of this Act.  All money

14-24    paid to the department [collected] under this Act is subject to

14-25    Subchapter F, Chapter 404, Government Code [shall be deposited in

14-26    the credit union department expense fund, which is created as a

14-27    special fund in the state treasury.  Money in the fund may be used

 15-1    only for the administration of this Act.  Income earned on the

 15-2    money deposited in the credit union department expense fund shall

 15-3    be credited to that fund].

 15-4          (d)  The commissioner or the commissioner's designee shall

 15-5    provide to members of the commission and to department employees,

 15-6    as often as necessary, information regarding their qualification

 15-7    for office or employment under this Act and their responsibilities

 15-8    under applicable laws relating to standards of conduct for state

 15-9    officers or employees.

15-10          (e)  The commission shall promulgate, and the commissioner

15-11    shall enforce, reasonable rules requiring credit unions to provide

15-12    or cause to be provided share and deposit insurance protection for

15-13    their members and depositors, including the authorization and

15-14    establishment of a share and deposit guaranty corporation or credit

15-15    union under the exclusive regulation of the department to enable

15-16    the department to carry out the purposes of this Act.  Share and

15-17    deposit insurance protection may also be provided through other

15-18    sources approved by the department, including such a program of the

15-19    National Credit Union Administration.

15-20          (f)  The commissioner shall supervise the establishment and

15-21    maintenance of files regarding each written complaint filed with

15-22    [complaints about credit unions received by] the department that

15-23    the department has authority to resolve.  The files must include

15-24    all relevant information regarding the nature, status, and

15-25    disposition of the complaints.  The department [commissioner] shall

15-26    provide to the person filing the complaint and the persons or

15-27    entities complained about the department's policies and procedures

 16-1    pertaining to complaint investigation and resolution.  The

 16-2    department, at least [take the steps that the commissioner

 16-3    determines to be necessary to notify each complainant of the

 16-4    procedures and remedies available for the resolution of complaints.

 16-5    After a written complaint is filed, the commissioner, at least as

 16-6    frequently as] quarterly and until final disposition of the

 16-7    complaint, shall notify the parties to the complaint of the status

 16-8    of the complaint unless the notice would jeopardize an undercover

 16-9    investigation.

16-10          (g)  The department shall keep information about each

16-11    complaint filed with the department.  The information shall

16-12    include:

16-13                (1)  the date the complaint is received;

16-14                (2)  the name of the complainant;

16-15                (3)  the subject matter of the complaint;

16-16                (4)  a record of all persons contacted in relation to

16-17    the complaint;

16-18                (5)  a summary of the results of the review or

16-19    investigation of the complaint; and

16-20                (6)  for complaints for which the department took no

16-21    action, an explanation of the reason the complaint was closed

16-22    without action.

16-23          (h) [(g)]  The commissioner shall supervise the preparation

16-24    of public interest information describing [regarding] the

16-25    [regulatory] functions of the department, procedures for filing and

16-26    resolution of complaints, and other matters of general interest

16-27    regarding [the] credit unions.  The commissioner [union movement

 17-1    and] shall make the [supervise the dissemination of that]

 17-2    information available to the general public and appropriate state

 17-3    agencies.

 17-4          (i)  The commission by rule shall establish methods by which

 17-5    consumers and service recipients are notified of the name, mailing

 17-6    address, and telephone number of the department for the purpose of

 17-7    directing complaints to the department.  The commission may provide

 17-8    for that notification:

 17-9                (1)  on each registration form, application, or written

17-10    contract for services of a credit union regulated under this Act;

17-11                (2)  on a sign prominently displayed in the place of

17-12    business of each credit union regulated under this Act; or

17-13                (3)  in a bill for service provided by a credit union

17-14    regulated under this Act.

17-15          (j)  The department shall comply with federal and state laws

17-16    related to program and facility accessibility.  The commissioner

17-17    shall also prepare and maintain a written plan that describes how a

17-18    person who does not speak English can be provided reasonable access

17-19    to the department's programs and services.

17-20          SECTION 14.  Section 11.18, Texas Credit Union Act (Article

17-21    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

17-22    read as follows:

17-23          Sec. 11.18.  CAREER PROGRAM; PERFORMANCE EVALUATION.  (a)

17-24    The commissioner or the commissioner's [his] designee shall develop

17-25    an intra-agency career ladder program that addresses opportunities

17-26    for mobility and advancement for employees within the department.

17-27    The program shall require [, one part of which shall be an]

 18-1    intra-agency posting of all nonentry level positions concurrently

 18-2    with [for at least 10 days before] any public posting.

 18-3          (b)  The commissioner or the commissioner's [his] designee

 18-4    shall develop a system of annual performance evaluations that are

 18-5    based on documented employee performance [measurable job tasks].

 18-6    All merit pay for department employees must be based on the system

 18-7    established under this section.

 18-8          SECTION 15.  Chapter 11, Texas Credit Union Act (Article

 18-9    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

18-10    adding Section 11.19 to read as follows:

18-11          Sec. 11.19.  EQUAL EMPLOYMENT OPPORTUNITY POLICY.  (a) The

18-12    commissioner or the commissioner's designee shall prepare and

18-13    maintain a written policy statement to assure implementation of a

18-14    program of equal employment opportunity under which all personnel

18-15    transactions are made without regard to race, color, disability,

18-16    sex, religion, age, or national origin.  The policy statement must

18-17    include:

18-18                (1)  personnel policies, including policies relating to

18-19    recruitment, evaluation, selection, appointment, training, and

18-20    promotion of personnel that are in compliance with requirements of

18-21    Chapter 21, Labor Code;

18-22                (2)  a comprehensive analysis of the department

18-23    workforce that meets federal and state guidelines;

18-24                (3)  procedures by which a determination can be made

18-25    about the extent of underuse in the department workforce of all

18-26    persons for whom federal or state guidelines encourage a more

18-27    equitable balance; and

 19-1                (4)  reasonable methods to appropriately address those

 19-2    areas of underuse.

 19-3          (b)  A policy statement prepared under Subsection (a) must

 19-4    cover an annual period, be updated annually and reviewed by the

 19-5    Texas Commission on Human Rights for compliance with Subsection

 19-6    (a)(1), and be filed with the governor's office.

 19-7          (c)  The governor's office shall deliver a biennial report to

 19-8    the legislature based on the information received under Subsection

 19-9    (b).  The report may be made separately or as a part of other

19-10    biennial reports made to the legislature.

19-11          SECTION 16.  Section 12.01, Texas Credit Union Act (Article

19-12    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended to

19-13    read as follows:

19-14          Sec. 12.01.  HEARINGS.  (a) The conduct of all hearings held

19-15    under this Act and the judicial review of the final decisions

19-16    following those hearings are governed by the administrative

19-17    procedure law, Chapter 2001, Government Code [the Administrative

19-18    Procedure and Texas Register Act, as amended (Article 6252-13a,

19-19    Vernon's Texas Civil Statutes)].   The commission may adopt rules

19-20    of procedure consistent with that chapter [the Administrative

19-21    Procedure and Texas Register Act, as amended,] for the fair hearing

19-22    and adjudication of all issues in a hearing held under this Act.

19-23    This section does not apply to a hearing under Section 12.03 of

19-24    this Act.

19-25          (b)  If the commission proposes to suspend or revoke a credit

19-26    union's certificate of incorporation, the credit union is entitled

19-27    to a hearing conducted by the State Office of Administrative

 20-1    Hearings.  Proceedings for a disciplinary action are governed by

 20-2    the administrative procedure law, Chapter 2001, Government Code.

 20-3    Rules of practice adopted by the commission under Section 2001.004,

 20-4    Government Code, applicable to the proceedings for a disciplinary

 20-5    action may not conflict with rules adopted by the State Office of

 20-6    Administrative Hearings.

 20-7          SECTION 17.  Chapter 12, Texas Credit Union Act (Article

 20-8    2461-1.01 et seq., Vernon's Texas Civil Statutes), is amended by

 20-9    adding Section 12.03 to read as follows:

20-10          Sec. 12.03.  PROCEDURE FOR CERTAIN APPROVALS.  (a) This

20-11    section applies to a request for approval by the commissioner of:

20-12                (1)  an application for incorporation under Section

20-13    2.03 of this Act;

20-14                (2)  a request for approval of an amendment to a credit

20-15    union's articles of incorporation under Section 2.06 of this Act,

20-16    including an amendment to expand the credit union's field of

20-17    membership; and

20-18                (3)  a merger or consolidation under Section 10.03 of

20-19    this Act.

20-20          (b)  Before approving a request to which this section

20-21    applies, the commissioner shall submit notice of the request to the

20-22    secretary of state for publication in the Texas Register.  The

20-23    commission by rule shall provide for other appropriate public

20-24    notice of the request.  The commissioner may waive the requirements

20-25    of this subsection or permit delayed public notice on a

20-26    determination that waiver or delay is in the public interest. If

20-27    the requirements of this subsection are waived, the information

 21-1    that would be contained in a public notice becomes public

 21-2    information under Chapter 552, Government Code, on the 35th day

 21-3    after the date the request is made.

 21-4          (c)  Before making a determination on a request to which this

 21-5    section applies, the commissioner must accept comment from any

 21-6    person who wishes to comment.  This comment may be in the form of

 21-7    written testimony or may be provided at a commissioner hearing held

 21-8    for the purpose of receiving this comment. This hearing shall be

 21-9    held if requested by any person.   The commissioner may hold the

21-10    hearing regardless of whether a person requests the hearing.  The

21-11    hearing is confidential.  Chapter 2001, Government Code, does not

21-12    apply to the hearing.  Not later than the 60th day after the date

21-13    the notice is published in the Texas Register, or if the notice is

21-14    not published, after the date the request is received, the

21-15    commissioner shall approve or disapprove the application.

21-16          SECTION 18.  The Sunset Advisory Commission, as part of its

21-17    evaluation of agencies preceding the meeting of the 77th

21-18    Legislature in 2001, shall:

21-19                (1)  evaluate the organizational structure of the

21-20    state's financial regulatory agencies; and

21-21                (2)  study the potential effects of placing the Credit

21-22    Union Commission under the jurisdiction of the Finance Commission

21-23    of Texas.

21-24          SECTION 19.  (a) The Credit Union Commission and the Finance

21-25    Commission of Texas shall jointly review state law, including

21-26    rules, governing financial institutions in this state.  The review

21-27    must include an examination of differences in the authority granted

 22-1    by law to the different state regulatory officers and agencies and

 22-2    how the officers and agencies differ in their manner of regulating

 22-3    the institutions under their respective jurisdictions.

 22-4          (b)  A report of the review shall be submitted to the Sunset

 22-5    Advisory Commission before September 1, 1999.

 22-6          SECTION 20.  If after the effective date of this Act a

 22-7    vacancy exists in a position of member of the Credit Union

 22-8    Commission that was held by an individual described by Section

 22-9    11.02(a), Texas Credit Union Act (Article 2461-1.01 et seq.,

22-10    Vernon's Texas Civil Statutes), the vacancy shall be filled by

22-11    appointment of an individual described by Section 11.02(b) of that

22-12    Act until the number of public members and members who represent

22-13    credit unions are as prescribed by those sections, as amended by

22-14    this Act.

22-15          SECTION 21.  This Act takes effect September 1, 1997.

22-16          SECTION 22.  The importance of this legislation and the

22-17    crowded condition of the calendars in both houses create an

22-18    emergency and an imperative public necessity that the

22-19    constitutional rule requiring bills to be read on three several

22-20    days in each house be suspended, and this rule is hereby suspended.