HBA-ATS C.S.S.B. 112 76(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.S.B. 112
By: Brown
Civil Practices
3/22/1999
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Texas law limits the types of investments in which money recovered by a
minor or incapacitated plaintiff, who is represented by a next friend, may
be invested.  The next friend may invest only in interest-bearing time
deposits in F.D.I.C.-insured financial institutions doing business in
Texas. Although the clerk of the court, on written order of the court of
proper jurisdiction, has a broader range of investment choices, the clerk
may currently invest only in the same interest-bearing time deposits, U.S.
treasury bills, eligible interlocal investment pools, or certain no-load
money market mutual funds. 

C.S.S.B. 112 authorizes a next friend who represents a minor or
incapacitated plaintiff and the clerk of the court to invest any money
recovered by the plaintiff in the Texas tomorrow fund (a fully guaranteed
prepaid program that provides coverage for the full tuition and required
fees at any public college or university in Texas, no matter how much they
increase).  In addition, this bill authorizes a trustee of a management
trust created by a court for the benefit of a ward of the state to invest
funds of the trust in the Texas tomorrow fund. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 142.004, Property Code, by amending Subsection
(a) and adding Subsection (e), as follows:  

(a) Includes the Texas tomorrow fund established by Subchapter F (Prepaid
Higher Education Tuition Program), Chapter 54 (Tuition And Fees), Education
Code, among the types of investments in which the clerk of the court, on
written order of the court of proper jurisdiction, or a next friend who
represents a minor or incapacitated plaintiff is authorized to invest any
money recovered by the plaintiff, if that money is not otherwise managed
under Chapter 142 (Management of Property Recovered in Suit by a Next
Friend).  Makes conforming changes. 

(e) Authorizes a court to waive any bonding requirements if the clerk of
the court invests the money in the Texas tomorrow fund 

SECTION 2.  Amends Section 868, Texas Probate Code, by adding Subsection
(f), to authorize a trustee of a management trust created by a court for
the benefit of a ward of the state to invest funds of the trust in the
Texas tomorrow fund established by Subchapter F, Chapter 54, Education
Code, if the trustee determines that it is in the best interest of the
ward. 

SECTION 3.Emergency clause.
  Effective date: upon passage.



 


COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.S.B. 112 modifies the original bill in SECTION 1 by authorizing the
clerk of the court, on written order of the court of proper jurisdiction,
to invest any money recovered by the plaintiff in the Texas tomorrow fund,
if that money is not otherwise managed under Chapter 142, Property Code. 

C.S.S.B. 112 modifies the original bill in SECTION 1 by adding Subsection
(e) to authorize a court to waive any bonding requirements if the clerk of
the court invests the money in the Texas tomorrow fund.