By Cain                                         S.B. No. 1691

      75R8831 MLS-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to authorizing state agencies and state employees to

 1-3     participate in charitable activities.

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

 1-5           SECTION 1.  Subtitle B, Title 6, Government Code, is amended

 1-6     by adding Chapter 667 to read as follows:

 1-7            CHAPTER 667.  CHARITABLE ACTIVITIES ON STATE PROPERTY

 1-8           Sec.  667.001.  DEFINITIONS.  In this chapter:

 1-9                 (1)  "Charitable organization" means an organization

1-10     that:

1-11                       (A)  is organized for charitable purposes under

1-12     the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq.,

1-13     Vernon's Texas Civil Statutes) or holds a certificate of authority

1-14     issued under that Act;

1-15                       (B)  is exempt from taxation under Section 501(a)

1-16     of the Internal Revenue Code of 1986 as an organization described

1-17     in  Section 501(c)(3) of that code and to which contributions are

1-18     deductible for income tax purposes under Section 170 of that code;

1-19                       (C)  complies with all applicable federal

1-20     nondiscrimination law, including Chapter 21, Title 42, United

1-21     States Code;

1-22                       (D)  complies with all state statutes and rules

1-23     relating to charitable organizations; and

1-24                       (E)  is not a private foundation.

 2-1                 (2)  "Eligible charitable organization" means a

 2-2     charitable organization eligible to participate in charitable

 2-3     activities on state property as provided by Section 667.003.

 2-4                 (3)  "State agency" means a department, commission,

 2-5     board, office, institution of higher education, or other agency of

 2-6     state government.

 2-7                 (4)  "State employee" means an employee of a state

 2-8     agency.

 2-9                 (5)  "State property" means land and buildings owned,

2-10     leased, or otherwise controlled by the state.

2-11           Sec. 667.002.  CHARITABLE ACTIVITIES ON STATE PROPERTY.  (a)

2-12     A state employee is entitled to participate in fund-raising

2-13     activities conducted on state property for the benefit of an

2-14     eligible charitable organization.

2-15           (b)  A state agency shall adopt rules regarding the location

2-16     and timing of charitable activities conducted under this chapter.

2-17           (c)  Participation by a state employee in a charitable

2-18     activity conducted on state property is voluntary.  A state agency

2-19     shall inform its employees that participation in charitable

2-20     activities conducted on state property is voluntary.

2-21           (d)  The comptroller shall adopt rules establishing a process

2-22     for hearing state employee complaints regarding coercive activity

2-23     in charitable activities conducted on state property.

2-24           Sec. 667.003.  ELIGIBILITY OF CHARITABLE ORGANIZATIONS.  To

2-25     be eligible to conduct a charitable activity on state property, a

2-26     charitable organization must:

2-27                 (1)  be governed by a voluntary board of citizens that

 3-1     meets at least twice each year to set policy and manage the affairs

 3-2     of the organization;

 3-3                 (2)  if the organization's annual budget:

 3-4                       (A)  is less than $100,000, provide a completed

 3-5     Internal Revenue Service Form 990 and an accountant's review that

 3-6     offer full and open disclosure of the organization's internal

 3-7     operations; or

 3-8                       (B)  is equal to or more than $100,000, be

 3-9     audited annually in accordance with generally accepted auditing

3-10     standards of the American Institute of Certified Public

3-11     Accountants; and

3-12                 (3)  not spend more than 25 percent of its annual

3-13     revenue for administrative and fund-raising expenses.

3-14           Sec. 667.004.  FUND-RAISING PRACTICES.  The fund-raising

3-15     practices of an eligible charitable organization must:

3-16                 (1)  be dedicated to a public purpose;

3-17                 (2)  be truthful and consumer-oriented;

3-18                 (3)  clearly identify and distinguish community-based

3-19     organizations from statewide and international organizations; and

3-20                 (4)  ensure protection against:

3-21                       (A)  unauthorized use of a list of contributors

3-22     to the organization;

3-23                       (B)  payment of commissions, kickbacks, finder

3-24     fees, percentages, bonuses, or overrides for fund-raising;

3-25                       (C)  mailing of unordered merchandise or tickets

3-26     with a request for money in return; and

3-27                       (D)  general telephone solicitation of the

 4-1     public.

 4-2           Sec. 667.005.  FUNDS RAISED.  (a)  All funds collected by

 4-3     state employees for the benefit of a charitable organization under

 4-4     this chapter shall be deposited in the state treasury within 30

 4-5     days after the date of collection.

 4-6           (b)  The comptroller by rule shall establish procedures for

 4-7     the distribution of funds raised under this chapter to eligible

 4-8     charitable organizations.

 4-9           Sec. 667.006.  LIMITATION ON USE OF FUNDS.  An eligible

4-10     charitable organization may not use funds raised under this

4-11     subchapter to:

4-12                 (1)  conduct litigation; or

4-13                 (2)  make expenditures that would require the

4-14     organization to register under Chapter 305 if the organization were

4-15     not an entity exempt from registration under that chapter.

4-16           Sec. 667.007.  AUDIT.  (a)  A state agency may request the

4-17     comptroller or state auditor to audit an eligible charitable

4-18     organization that the state agency reasonably believes has

4-19     misapplied funds raised under this chapter.

4-20           (b)  The attorney general may bring an action to recover

4-21     misapplied funds.

4-22           SECTION 2.  Section 497.091, Government Code, is amended by

4-23     adding Subsection (d) to read as follows:

4-24           (d)  The department may contract with a nonprofit

4-25     organization to provide it with inmate labor if the organization

4-26     provides services to the general public that enhance the social

4-27     welfare and economic development of the community.

 5-1           SECTION 3.  Section 94.015, Human Resources Code, is amended

 5-2     by adding Subsection (d) to read as follows:

 5-3           (d)  This chapter does not prohibit a state agency from

 5-4     permitting a charitable organization to conduct a fund-raising

 5-5     activity on state property under Chapter 667, Government Code.

 5-6           SECTION 4.  The importance of this legislation and the

 5-7     crowded condition of the calendars in both houses create an

 5-8     emergency and an imperative public necessity that the

 5-9     constitutional rule requiring bills to be read on three several

5-10     days in each house be suspended, and this rule is hereby suspended,

5-11     and that this Act take effect and be in force from and after its

5-12     passage, and it is so enacted.