1-1           By:  Sibley                                      S.B. No. 616

 1-2           (In the Senate - Filed February 17, 1997; February 19, 1997,

 1-3     read first time and referred to Committee on Education;

 1-4     March 10, 1997, reported adversely, with favorable Committee

 1-5     Substitute by the following vote:  Yeas 10, Nays 0; March 10, 1997,

 1-6     sent to printer.)

 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 616                   By:  Sibley

 1-8                            A BILL TO BE ENTITLED

 1-9                                   AN ACT

1-10     relating to the standards of conduct for former directors,

1-11     officers, and employees of a nonprofit corporation under contract

1-12     to invest the permanent university fund or certain other university

1-13     funds and to the corporation's dealings with a former director,

1-14     officer, or employee; providing a penalty.

1-15           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

1-16           SECTION 1.  Section 66.08, Education Code, is amended by

1-17     amending Subsection (i), adding new Subsections (l), (m), and (n),

1-18     and redesignating existing Subsection (l) as Subsection (o) and

1-19     amending that subsection to read as follows:

1-20           (i)  The corporation may not enter into an agreement or

1-21     transaction with a:

1-22                 (1)  director, officer, or employee of the corporation

1-23     acting in other than an official capacity on behalf of the

1-24     corporation; or

1-25                 (2)  business entity in which a director, officer, or

1-26     employee of the corporation has an interest[;]

1-27                 [(3)  former director, officer, or employee of the

1-28     corporation on or before the second anniversary of the date the

1-29     person ceased to be a director, officer, or employee of the

1-30     corporation; or]

1-31                 [(4)  business entity in which a former director,

1-32     officer, or employee of the corporation has an interest on or

1-33     before the second anniversary of the date the person ceased to be a

1-34     director, officer, or employee of the corporation].

1-35           (l)  A former director of the corporation may not make any

1-36     communication to or appearance before a director, officer, or

1-37     employee of the corporation before the second anniversary of the

1-38     date an individual ceased to be a director of the corporation if

1-39     the communication or appearance is made:

1-40                 (1)  with the intent to influence; and

1-41                 (2)  on behalf of any person in connection with any

1-42     matter on which the person seeks action by the corporation.

1-43           (m)  A former officer or employee of the corporation may not

1-44     represent any person or receive compensation for services rendered

1-45     on behalf of any person regarding a particular matter in which the

1-46     former officer or employee participated during the period of

1-47     service or employment with the corporation, either through personal

1-48     involvement or because the particular matter was within the

1-49     officer's or employee's responsibility.

1-50           (n)  An individual who violates Subsection (l) or (m) commits

1-51     an offense.  An offense under this subsection is a Class A

1-52     misdemeanor.

1-53           (o) [(l)]  In this section:

1-54                 (1)  "Board" means the board of regents of The

1-55     University of Texas System.

1-56                 (2)  "Governing board," "institutional fund," and

1-57     "institution of higher education" have the meanings assigned by

1-58     Chapter 163, Property Code.

1-59                 (3)  "Participated" means to have taken action as an

1-60     officer or employee through decision, approval, disapproval,

1-61     recommendation, giving advice, investigation, or similar action.

1-62                 (4)  "Particular matter" means a specific

1-63     investigation, application, request for a ruling or determination,

1-64     rulemaking proceeding, contract, claim, charge, accusation, arrest,

 2-1     or judicial or other proceeding.

 2-2           SECTION 2.  The importance of this legislation and the

 2-3     crowded condition of the calendars in both houses create an

 2-4     emergency and an imperative public necessity that the

 2-5     constitutional rule requiring bills to be read on three several

 2-6     days in each house be suspended, and this rule is hereby suspended,

 2-7     and that this Act take effect and be in force from and after its

 2-8     passage, and it is so enacted.

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