1-1 AN ACT
1-2 relating to the board of directors of the Texas Workers'
1-3 Compensation Insurance Fund.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 3, Article 5.76-3, Insurance Code, is
1-6 amended to read as follows:
1-7 Sec. 3. BOARD OF DIRECTORS. (a) The fund is governed by a
1-8 board of directors composed of nine members, all of whom shall be
1-9 citizens of this state. The members shall be appointed by the
1-10 governor with the advice and consent of the senate, and vacancies
1-11 shall be filled in the same manner.
1-12 (b) The members of the board of directors serve staggered
1-13 six-year terms, with the terms of three members expiring February 1
1-14 of each odd-numbered year. A member of the board whose term has
1-15 expired shall continue to serve until the member's replacement is
1-16 appointed by the governor.
1-17 [(b) Except as provided by Subsection (c) of this section,
1-18 to be eligible for appointment as a member of the board a person
1-19 must be a policyholder of the fund or an officer or employee of a
1-20 policyholder and must maintain that status during the period of
1-21 service on the board. Failure to maintain that status disqualifies
1-22 the board member and creates a vacancy on the board.]
1-23 (c) [The initial appointees to the board must be employers
1-24 in this state.]
2-1 [(d)] In making appointments to the board, the governor
2-2 shall attempt to reflect the social, geographic, and economic
2-3 diversity of the state. To ensure balanced representation, the
2-4 governor may consider the geographic location of a prospective
2-5 appointee's domicile and the prospective appointee's experience in
2-6 business and insurance matters and shall consider those factors in
2-7 appointing members to fill vacancies on the board. Appointments to
2-8 the board shall be made without regard to the race, color,
2-9 disability, sex, religion, age, or national origin of the
2-10 appointees.
2-11 (d) [(e)] A person may not serve as a member of the board if
2-12 the person, an individual related to the person within the second
2-13 degree by consanguinity or affinity, or an individual residing in
2-14 the same household with the person:
2-15 (1) is required to be registered or licensed under
2-16 this code;
2-17 (2) is employed by or acts as a consultant to a person
2-18 required to be registered or licensed under this code;
2-19 (3) owns, controls, has a financial interest in, or
2-20 participates in the management of an organization required to be
2-21 registered or licensed under this code;
2-22 (4) receives a substantial tangible benefit from the
2-23 fund or the Texas Department of Insurance; or
2-24 (5) is an officer, employee, or consultant of an
2-25 association in the field of insurance.
2-26 (e) [(f)] It is a ground for removal from the board if a
2-27 member:
3-1 (1) does not have at the time of appointment the
3-2 qualifications required by [Subsection (b) of] this section;
3-3 (2) does not maintain during service on the board the
3-4 qualifications required by [Subsection (b) of] this section;
3-5 (3) cannot because of illness or disability discharge
3-6 the member's duties for a substantial part of the term for which
3-7 the member is appointed; or
3-8 (4) is absent from more than half of the regularly
3-9 scheduled board meetings that the member is eligible to attend
3-10 during a calendar year.
3-11 (f) [(g)] The validity of an action of the board is not
3-12 affected by the fact that it is taken when a ground for removal of
3-13 a board member exists.
3-14 (g) [(h)] If the president has knowledge that a potential
3-15 ground for removal exists, the president shall notify the chairman
3-16 of the board of the potential ground. The chairman shall then
3-17 notify the governor and the attorney general that a potential
3-18 ground for removal exists. If the potential ground for removal
3-19 involves the chairman, the president shall notify the next highest
3-20 officer of the board, who shall notify the governor and the
3-21 attorney general that a potential ground for removal exists.
3-22 (h) [(i)] Subsection (d) [(e)] of this section does not
3-23 prohibit a person who is only a consumer of insurance or insurance
3-24 products from serving as a member of the board.
3-25 (i) [(j)] A person who is ineligible to serve on the board
3-26 under Subsection (d) [(e)] of this section may not serve as a
3-27 member of the board for one year after the date on which the
4-1 condition that makes the person ineligible ends.
4-2 (j) [(k)] Each member shall receive actual and necessary
4-3 travel expenses and expenses incurred in the performance of the
4-4 member's duties as a member.
4-5 (k) [(l)] The governor shall designate a member of the board
4-6 as the chairman of the board to serve in that capacity at the
4-7 pleasure of the governor. The members of the board shall elect
4-8 annually from their number a vice-chairman and a secretary.
4-9 (l) [(m)] The board shall hold meetings at least once each
4-10 calendar quarter and at other times at the call of the chairman and
4-11 at times established by board rule. Special meetings may be called
4-12 by any two members of the board on two days notice.
4-13 (m) [(n)] A majority of the board members constitutes a
4-14 quorum.
4-15 (n) [(o)] The board shall maintain the principal office of
4-16 the fund in Austin, Texas.
4-17 (o) [(p)] For cost control purposes and as is determined to
4-18 be cost-effective, as many functions as possible shall be performed
4-19 by the fund.
4-20 (p) [(q)] A person may not serve as a member of the board or
4-21 act as the general counsel to the board or the fund if the person
4-22 is required to register as a lobbyist under Chapter 305, Government
4-23 Code, because of the person's activities for compensation on behalf
4-24 of any person or entity other than the fund.
4-25 (q) [(r)] The board shall develop and implement policies
4-26 that clearly separate the policymaking responsibilities of the
4-27 board and the management responsibilities of the president and the
5-1 staff of the fund.
5-2 SECTION 2. The importance of this legislation and the
5-3 crowded condition of the calendars in both houses create an
5-4 emergency and an imperative public necessity that the
5-5 constitutional rule requiring bills to be read on three several
5-6 days in each house be suspended, and this rule is hereby suspended,
5-7 and that this Act take effect and be in force from and after its
5-8 passage, and it is so enacted.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 542 was passed by the House on April
20, 1999, by a non-record vote; that the House refused to concur in
Senate amendments to H.B. No. 542 on May 26, 1999, and requested
the appointment of a conference committee to consider the
differences between the two houses; and that the House adopted the
conference committee report on H.B. No. 542 on May 30, 1999, by the
following vote: Yeas 142, Nays 0, 1 present, not voting.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 542 was passed by the Senate, with
amendments, on May 24, 1999, by the following vote: Yeas 30, Nays
0; at the request of the House, the Senate appointed a conference
committee to consider the differences between the two houses; and
that the Senate adopted the conference committee report on H.B. No.
542 on May 30, 1999, by the following vote: Yeas 30, Nays 0.
_______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor